Ladysmith news-budget. [volume] (Ladysmith, Rusk County, Wis.) 1907-1927, 1913-08-01
WHEN THE BANKER
CASHES YOUR CHECK

friendly, but as there was no other
bank near at hand Sommers maintained
commercial account in Mcpherson s
institution. One Tuesday morning he
purchased a load of potatoes from
Clyde Webb, a prominent farmer OF
the vicinity. Sommers paid Webb i'm
mediately, giving him check for
twenty dollars properly drawn on his
account in the Elmwood Savings Bank.
Webb took the check to the bank and
presented it to Mcpherson, who was in
the teller's cage
"What did you do, go and sell that
load of potatoes to Scmmers?" inquired
Mcpherson.
eyes; why not?" replied Webb.
"Well, you might have given me a
chance at them. You know I'm buy
ing produce, as we'll as banking.
That's no reason why | shouldn I
sell to John Sommers.
"Well I'll show you you're fool to
sell to him" angrily asserted the bank
err. ''He paid you with check, didn' t
he? And you took it; and it amt no
good at all; see!'
"What's the matter?" asked Webb.
"Why, he's no good financially, and
his checks no good, and you can't get
any money on it"
Webb returned to Sommers, and
Sommers FASTENED to the bank, know
ing that his balance stood close to four
hundred dollars After a heated dis
cussion at the bank Sommers travelled
to the Office of his legal counsellor. AS
a result action was begun against the
banker because of his failure to cash
the depositor's proper check, and sub
stantial damages were recovered be-
cause McPherson's action had injured
Sommor's standing and credit in the
community.
This case illustrates what is perhaps
the primary duty of the banker to his
depositor--to pay all proper checks
drawn on him against adequate depos-
it's. If the banker fails to do this,
either willfully or through mistake, he
must answer to his depositor. If the
depositor whose check was wrongfully
dishonored suffered any damages he
may recover the amount against the
tanker. Injury to credit and business
standing are the damages usually COM
,Iaipa6 Of ~, c,,ob oococ Tho bo,L ~,
is entitled to reasonable time after
presentment in order that he may ex-
anime into the state of the account
against which the check is drawn
Good bankers have their affairs so ar
ranged that this is matter of seconds
rather than minutes.
When Sommers sued Mcpherson, Nc
Pherson defended his action on the
ground that while Sommers did have a
balance of about four hundred dollars
the bank held Sommer's note for five
hundred dollars, which was to fall due
within a week The banker insisted
that he had right to retain Sommer' s
deposits to insure payment of the note
when it should fall due His posi- tiou
was not justified in law and furnished
him with no effective defense. A bank
err may set-off an Indebtedness that is
due by the depositor to the bank
against the deposit, but he may not
set-of one not yet due. Sommers
could not be required to pay the note
until its maturity, and until then it was
not an effective obligation against him.
1t not infrequently happens that the
holder of check for say ten dollars,
will present it at the bank for pay
ment and discover that the depositor
has balance of but seven. Often the
holder of the check would be glad
enough to get the proportion that the
deposit would cover then and there.
But the bank need not make part pay
ment. This is because it is entitled
to the check for use as a voucher in
settling with the depositor.
When the bank pays a proper
check it has a right to charge pay
ment against the depositor. 1t may
be that the bank will choose not
to dishonor the check for ten dol
lars when a balance of but seven
remains and will accommodate it's
depOsitOr by paying the check in full.
This is what is known asa cover
draft" and while contrary to the
printed rules of most banks is still
frequently done in ordinary CONNER
cial practice If the bank allows an
overdraft, in effect advancing money
for it's depositor, it may recover the
amount from him.
Bankers do not take time to in
vestigate a depositor's account for
every check that is presented to the
bank for payment. They depend up
on memory and confidence in the
depositor, in many instances SO it
sometimes happens that bank will
pay check under the belief that
the signer has an adequate balance
6nnOSit whom Cnch iC ho