New-York tribune., 1912-01-07
MUST IDENTIFY PAYEES
Appellate Division Decides Case
Where SwindIers CaShed Check.
ARMY PAY DISCOUNTED
Money Lender Advanced 81, 426
on Letters and Vouchers OF
Pretended Officers.

The Appellate Division Of the Supreme
Court has handed down a decision that will
ba of interest to all who draw checks on
bank accounts and will give them a little
knowledge Of law that may stand them in
good stead.
The case revealed practice among some
army officers Of discountinG the vouchers
for their monthly pay The substance Of
the court decision was that a man VINO
drew check and sent It to the person to
whose order it was drawn was not re-
snonsible if some person other than the
payce cashcd the check, but that the BANK
was responsible for the determination OF
the identity of payees.
The case was that Of the Mercantile Ma
tionaI Bank against Louis Silvcrman, VINO
lends money 10 army officers In advance OF
t,oir nav vouchers. The suit was to re-
cover on a promssory note The defend
ant admitted liability under the note but
insisted that two checks drawn by MN De
deducted from the amount Of the note.
siIycrman lost in the lower court and he
anpealcd 10 the Appellat, Division.
This is the history Of the two checks
drawn by Silvcrman. and from when ne
o.lcd IN he relieved Of liability. He adj
vcrtisos his private banking business In
..Tbo Army and Navy Register" man
signing himself Lieutenant Colonel Fred
crick Marsh OF the coast artillery corps
wrote to Slverman in answer to TINS ad-
,.ortieomont The writer was living Al the
vou. willard Hotel, in Washington, and
Ia ,rantod to discount a few months pay.
rho writer said he was formerly on duty
a., tho Preside. san Francisco, but had
boop transferred to the office OF the chief
oC artillery. in Washington. At the same
Mace. said the supposed Lieutenant Colonel
Marsh. there was also on duty at the once
Of the chief OF artillery one Captain
lanes 4. Shipton," also Of the coast ar
,uIor,, rorps. who was indebted to him
and would like 10 do business with Silver
man. so he could pay off the debt.
Suvcrrnan received a letter from the sup
,ogod "Captain Shipton" Indorsing what
tbo other writer had said. The money
lander looked up the names Of the two
omcers and fodnd there were such men in
the army service, and that their posts in
The official lists cOrresponded with the IN
formation I'm the Marsh" letter
Suvernan was satisfied that his new
clients were all right, and wrote TO them
eaving that he would forward the money II
they would send him their vouchers. They
came written on tho form used by the
nav departmcnt Of the United States army.
Suycrman sent the checks. They were de-
pos,ted for collection at the American Ma
tional Bank I'm Washington.
The man purporting 10 be Lieutenant Col
oucl Marsh went TO the bank and opened
an account, saying he did not care 20 draw
the money on the checks until they became
du, He showed some letters addressed
IN 81 Lieutenant Colonel Marsh" at the VIII
Lard. lust as Slverman addressed him. and
prod,iced the "Shipton" checks, already in
dorsed
He deposited the checks. and then, on his
rcoucst although he Was unknown at the
hank the assistant cashier lent him 80
Roth checks, one for $500 and the other for
s52G 20. were sent by the American National
rank with the Endorsements guaranteed
IN the Fourth National Bank In New York,
went through the Clearing House and were
paid.
The man IN Washington collected the
money AT the bank there. and that was the
last seen Of him. as he was an lmposlor
neither Lieutenant Colonel Marsh nor cap
tain Shipton having written to Silverman.
When the money lender learned that his
money had gone to one ~ more s"lhdieIs'