Savannah morning news. [volume] (Savannah) 1868-1887, 1883-03-27
A STOLEN LETTER OF CREDIT.
Its Negotiation by Thief Gives Rise
to an Interesting Lawsuit


Philddelphia Special to Ye,o York Herad
A suit begun by Drexel & Co., the bank
ers of this city, London and Paris. against
Mr.. Henry Huddy, wealthy retired mer-
chant, as we'll known in New York as he
is here, is calculated to attract a large
share of attention among travelled Ameri-
cans and Americans who propose to travel
abroad. 1t really involves the integrity
of the letter of credit system, is remarka-
bic as being the first case of the kind ever
brought, and as involving banking houses
in France, England, Holland and America.
The history of the case is interesting
and is briefly told. In the summer of 1881
Mr.. Huddy took his wife and sister-in-law
abroad, Before leaving this city he Sc
cured letter of credit from Drexel & Co,
so drawn that he was privileged to draw
against it in pounds sterling through
Morgan x Co., the London branch of the
Philadelphia house, or in France through
Dire Xel, Harjes & Co., the Paris branch.
On August 10, 1881, Mr.. Huddy and his
party arrived in Frankfort, having previ-
ously established relations with Drexel
Harjes & Co. On the same daV
they started for Saint Maurice,
and at Heidelberg they left the
train for refreshments. The station
was crowded, and while returning from
the restaurant Mr.. Huddy and his wife
were persistently j0stled by a party Of
men, OF whose appearance in the cOnfu-
sion they could get no clear idea. Mr..
Huddy carried his letter of credit and
3O0f. in money in wallet in an inner
breast pocket of his coat. A moment af,
ter he regained his compartment in the
train, he discovered that his coat had been
unbuttoned and that he had been robbed
of his wallet and It's contents. None of
his party could speak German, but they
were relieved from this dilemma bv an
English gentleman on the same train.
who, at Mr.. Huddy's dictation, telegraph
ed the facts of the robbery to DreXeI.
Harjes & Co., from Carlsruhe, which
is an hours ride from Heidelberg.
On the day following second dispatch
was sent TO the Paris bankers from Zu-
rich, and Mr., Huddy says that in reply tn
this he was notified by the firm that the
letter had been cancelled. This set his
mind at rest, as he believed that the thief
would not succeed in Negotiating any
drafts against the letter Of credit. He
was amazed a few weeks subsequently.
upon his return from Paris. to learn thai
the pickp0cket had succeeded in having
the letter Of credit cashed for its full
amOunt-$5, ,000-by Hoyake & Co. bank
ers, in Amsterdam, and correspondents of
the London and Paris branches of Drexel
& Co.
To obtaiR the money the thief had to
forge the signature of Mr.. Huddy. and in
view of this fact the latter concluded that
the Amsterdam house would have to bear
the loss accruing from its own negligence
in cashing the forged letter. When he re-
turned to this country, however, he learn
ed that HOyake Il Co. had secured Them
selves by transferring to their own credit
$1,000 Of the funds of Morgan & Co. of
London; In turn the London house
charged up the amount to DrexeI & Co..
OF TINS city, who now sue Mr.. Huddy,
holding him 9n the guarantee, though he
never drew dollar against the letter.
Mir. Huddy made extensive Inquiries In
Europe, and so far as he can ascertain his
was the flrst case IN which money had
been obtained on q letter of credit lost. bv
theft or otherwise, by its proper owner.
Among travellers it is deemed remarkable
that letter of credit for so considerable
an amount should have been paid in full
on one day, as this one was, The thief
succeeded in getting his money on the
day Following that ON which he committed
the robbery,
The bankers allege negligence against
Mr.. Huddy, but that gentleman saws he /
proposes to make this case a test as to
whether person to whom a letter of
credit is issued can be held responsible
for its payment if he should lose it. and
the nnder should obtain the money by
forging the owners signature.
Attorney General Cassidy, who repre-
sents Mr.. Huddy, says that the guarantee
will give the banking house no protection
In the face of a forgery. That the letter |
OF credit, as paid, was forgery is not dis
puted, and to hold his client responsible |
would be, he says, equivalent to making |
letters OF credit menaces rather than /,
means of convenience and protectico N
those to whom they were issued
The case is likely TO be troneht 10 trial
before the summer Lt,agira 10 Europe be-
Ems; ana It's Determination one way or
ahotler IS likely TO have marked effect
"a the letter Of credit branch of the busi-
ness of bankers in this city, New York and
elsewhere.