The sun. [volume] (New York [N.Y.]) 1833-1916, 1870-05-13
THE QUIREEL OF THE BISKERs
The State Bank OF Boston Bound by ita
Cashiers Ccrtihcntion 60 The Innocent
Holder Of IA Certified Check Protected
Bank Rules supposed to Relate To
a. nrtir

The state Bank OF Boston Bound by it-
Cashiers Ccrtihcation co. The Innocent
Holder Of IA Certified Check Protected
Bank Ruics supposed to Relate to
Clearing House transactions.
The triil Of the case Of Pit Cooke against the
State National Bank Of Boston, which Lad been
trg before Judge Brady, Supreme Court Circuit,
firce Monday, was conc udcd yesterday. The action
was TO recover upon cleck for Sl25O00 certified
By the cashier OF tho bank in March, 1901, payment
Of hic was refused on the ground that the cashier
had authority 10 certify checks without first
sultrg the officers OF the bank. Judge Brady denied
a motion for 4 noasuit, and directed verdict for
the plaintiff, staying proceedings pending decision
BY the General Term.
The Court held, lrst, that the cashier Of bank In
rirtute Qciei an incident thereto, may certify
eheos drawn upon his bauk TO he good; that such
act OF cashier Is q declaration officially made by
him that the drawer has funds With which to pay
the check deposited to his credit and is equivalent
to the acceptance OF bill OF exchange That the
ast being authorized by the power lac possesses the
holder or presenter Of the check Is not bound 10
inquire into facts aHHHd6 having tho right to rest in
regard to them upon the repreeen ation the orl
Ger. IL other words that the certlcaton being the
apparent lawful exercise OF authority, the holder or
presenter II under obligation to inquire whether
Tie drawer has in faet funds In the ban k
I'D That the application OF these rules doDGSlS.
upon the question, II the act OF the cashier be In any
respect Unauthorized, whether the check Is held
BONA ntf6 Tor ne, ana without nOlcc. Ilat tho
resolution In relation to certified checks adopted BY
tue representatives, OF certain banks, and opposed
by the representative OF the defendants bank, was
not such nOtice to the Second National Bank, the
agent Of Jay Cooke y 60. for the collection o( the
draft. That it was designed TO regulate exchanges
and settlements between the banks and the Clearing
HOuse-to establish q RUE loT the general dealings
with each other, and must be limited 10 the object
| for which II was intended.
"a. That tie notice TO the Second National Bank.
based upon the opposition of the defendants to the
passage o. that resolution, IL negative IN Its chnrac
ter, and such also is that wcd Is predicated Of tue
omission to serve notice OF intention 70 concur IN H.
That a. notice. II Is one only OF the intention OF
the defendants not 10 regulate their EXCHANGES and
| mako their settlements IN the manner contemplated
by it-nOt direct, but Indirect indication OF huch
an intention, and not bv any means notice 10 Tho
| Second National Bank that the defendants cashier
had no authority IN ANY case 10 ceru'y ehecA W
4tn That even II this view be not entirely cor.
rect, that there Is still another rule TO be applied
| here which Is general namely: the principal IL
| cnorgeabe with knowledge for the reason that the
| agent Is substituted In his place and represents him
| In the particular transaction; and ms this relation
strictly speaking kiss only WINE the agent If acing
| IN the business thus delegated to hin, II must he
limited to such occasions There IA no pretcncC
that notice curing the transaction here Investigated
| was given.
| oh. That the cerHncation of checks for another
on soverul occ sons by the cashier warrants Tie
conclusion, In the absence of SPECIFIC notice 10 W'
contrary, that such was q practice OF the delendnt@
binding upon thCa In its results, between them anl
third parties who are innocent holders Tor value.
Ga, That there Is nothing in the act OF CONGRESS
under which the defendants were organized Uro
hibl,ins the certifying OF checks, ond as 'no re- VI
OF these views, hat they are liable to the plainul II
| this action. | understand the cases ci,cd IN In
| United States Courts to hold that, though IN
cashier or other Gni'cr may not oy gc's Wlfd rH,
make contracts, hc may nCNorth' less blnd the luhI
In the exercise of the ordinary duties 81 MS ioslu"
-ncs relating directly 10 the institution OF whic
he Is one Of tho agents.