The New York herald., 1870-11-17


Jury Admonished by
Judge Bedford.
UNITED STATES DISTRICT COURT-lA EQUITY,
The Rights OF the Government with Respect
60 National Counterfeit Notes.-The Jay
Cooke $50 Notes Litigation-IE,portant
Before Judge Blatchford.
The United States cs. Jay Cooke d Gothic hear
Inv OF this case, adjourned over from the previous
day, was resumed yesterday. This Is a test case,
there being eight business firms In this and other
cities against whom the government claim restitu-
tion for sums paid to them on redemption or notes
OF the 1880 issues, which notes, safter the amounts
represented by them had been paid by the Trea-
sury Department. were found, as Is alleged,
TO be counterfeit The total claimed to be
thus paid amounts to $4,000; the action
IN the present case being for the recovery of
eighteen 81 900 seven thirty notes presented to the
Treasury Department by the defendants, Jay Cooke
lar actions are penoing are Yermilyea Co., OF this
city, and Brewster, Sweet y Co., Of Boston,.
the government on tho one one hand, and the defend.
Ants on theioher rely are as follows:-ln the month
thirty notes OF the Issue Of June Is 1885, were pre-.
sened TO the Sub-Treasurer IN this city, Mr.. Van-
DYKE These me notes mere there aad then a &C.
face paid over, and the notes soon alter
transmitted to the Department at Washington,
where, after undergoing the usual scrutiny, num-
Der OF them were found 10 be counterfeis, and
among these, as alleged, were eighteen notes Of
81, 600 each endorsed by Jay Cooke d Co. All the
spurious notes were returned to the Sub Treasurer,
VINO demanded restitution on the part Of the gov
ernment OF the funds drawn by the various parties
on these counterfeit notes. The defendants, with
the other bankers communicated with on the sub.
ect refused to make restitution and therefore the
government entered upon the present action III the
Case CT Cooke & Co. TO assert It's claimed right to
recover.
The government claims that the eighteen notes In
question counterfeit and that upon them restitu
ton must be made. The defence claims, first that
the notes are genulne second, that II they even
were counterfeits the same rule must apply to
TRANSACTIONS with the Treasury Department that in
similar case would apply TO private banking as
socialion. The government, In answer 10 this, con-
tend that the Sub-Ireasury Ia merely an agency es
tablished hero by the government for the conve-
nienee and expedition OF business, and that an ac-
ceptance by the Sub-rreasury or these particular
notes and payment thereof cannot be considered q
hna redemption, redemption only accrulng
Wnen the notes, alter undergoing all the
required examination anu scrutiny at Washington,
received their nal cancellation the Treasury DE.
partment. Ii, as asserted by The defence, it was
mere contract between these defendants and The
Sub-Treasury, the very discovery that the notes
were fraudulent acted as repeal to the contract
1nasinucn as there was no consideration.
Judge Blatchfotd, after most patient hearing OF
argument on boh sides, decided the question as to
the liability OF the defendants, saying that inasmuch
Is the United States Sub-Treasury or the Treasury
Department Itself had no right TO take any but good
notes the contract must be null and void that the
defendants, In presenting these notes to the Sub
Treasury, represented that they were genuine notes.
and accepting that representation the ub-Treasury
had paid the money OF the government upon them.
The next question which Is sIl In dispute Is whether
the notes are really genuine or spurious notes. and
Oh this the Court VIII proceed day before jury.