Case ID: ga-app_34/html/0756-01.html
Source: Caselaw Access Project
Author: {"author": "Jenkins, P. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

16519.
    COMMERCIAL BANK OF ATHENS, for use, etc., v. COHEN.
    A check given for whisky, being for an illegal consideration, is void, and therefore not enforceable even by an innocent purchaser of the check. Under the facts of this case the signer of the check sued upon was not estopped from setting up its invalidity.
    Decided December 22, 1925.
    Complaint; from Clarke superior court—Judge Fortson. April 10, 1925.
    The Commercial Bank of Athens brought suit, for the use of Frank Posterio, against Edward M. Cohen, upon a cheek for $375. The defendant filed a plea alleging that the check was given to L. B. Haar as the purchase price of a certain lot of whisky bought by the defendant from Haar, and which was to be delivered by him but was never delivered. There was no contradiction of defendant’s testimony to the effect that the check was given to Harr for whisky. The plaintiff, by amendment, alleged that the defendant was es-topped from claiming immunity from liability on the cheek to the bank (which cashed it), for the reason that he obtained notice that, notwithstanding Haar’s failure to deliver the whisky as agreed, the holder of the check was peddling the check around town, attempting to have it cashed, and that he ought to have notified the banks of the city not to cash it, when he had ample time and opportunity so to do. The evidence showed, however, that the check was given after banking hours, and was cashed after hours by a different bank than the drawee, in about thirty minutes from the time that the drawer knew that he had attempted to procure an individual to cash it. Upon the conclusion of the evidence the court directed a verdict for the defendant. The plaintiff assigns error thereon.
    
      Lamar C. Bucher, for plaintiff.
    
      Erwin, Erwin & Nix, for defendant.
   Jenkins, P. J.

(After stating the foregoing facts.) 1. In determining the rights of a bona fide holder for value of a check given by the drawer in payment for intoxicating liquors, section 4251 of the Civil Code (1910), which declares, “A contract to do an immoral or illegal thing is void,” is to be construed in connection with section 4286, which declares that the bona fide holder for value of a draft, or other negotiable instrument, who receives it before it is due, and without notice of any defect or defense, is protected from any defense set up by tbe signer, except those therein specifically named, one of which is where the contract is based on a “gambling, or immoral and illegal consideration.” The use of the word “and” in the latter section does not seem to acquire any controlling significance, since the first section, which makes the illegal instrument void, uses the disjunctive “or.” Where a note or check is based on an illegal consideration, section 4251, supra, declares the instrument to be void, and it is unenforceable anywhere. Johnston v. McConnell, 65 Ga. 129 (2). The rule is different where the consideration is not illegal and the instrument void, but the infirmity consists merely in noneompliance with a statutory requirement, such as failure, under what is known as “the blue-sky law,” to insert the consideration in the face of the instrument. Smith v. Wood, 111 Ga. 221 (1) (36 S. E. 649) ; Heard v. National Bank of Wilkes, 143 Ga. 48, 50 (84 S. E. 129). Moreover, it was held in International Agricultural Corporation v. Spencer, 17 Ga. App. 649 (1) (84 S. E. 129), that “an illegal and void contract becomes an immoral contract when it is made a crime by statute.” Thus, a cheek given for such an illegal and immoral consideration being void, it can not be enforced by law, even in the hands of an innocent purchaser for value before due and without any notice of defenses to it. Crigler v. Laramore, 18 Ga. App. 132 (88 S. E. 901).

2. Under the facts disclosed by the record, no question of estoppel is involved. The signer of the check having the legal right to stand upon its invalidity, it was not incumbent upon him to notify the general public that the instrument was void. There are some authorities to the effect that where the signer of such an instrument fraudulently induces a bona fide purchaser to acquire it, he is estopped from contesting its validity. See 15 L. R. A. (N S.) 1023; Ball v. Powers, 62 Ga. 757. No such question arises here. In point of fact the check was given after banking hours, and was cashed after hours by a bank other than the drawee, within about thirty minutes or less from the time that the defendant was apprised that the holder had attempted to obtain the money thereon from an individual. See Comer v. Dufour, 95 Ga. 376, 378 (22 S. E. 543, 30 L. R. A. 300, 51 Am. St. Rep. 89).

Judgment affirmed.

Stephens and Bell, JJ., concur.