Court Opinion

ID: 6139879
Source: CourtListenerOpinion
Date Created: 2022-02-05 14:36:54.6092+00
Date Added: 2024-06-11T08:54:35.771526
License: Public Domain

By the Court.
Daly, F. J.
By putting his name on the check, the defendant incurred no other liability than that o: *258indorser, and liis liability was at an end when the holder failed to charge him. by demand and notice. If the proper steps had been taken to charge him, it would have been no defence on his part that the indorsement of the name of the payee was a forgery, for, by his contract of indorsement, he engaged or guaranteed that the check would be paid, or, if not, that he would pay it upon due service of notice, according to the usage of the law merchant. He was not so notified, and was accordingly discharged from his contract of indorsement, and from everything incident to it.
He is sought to be charged in the action upon the ground that, by indorsing the eiieck, he warranted to every subsequent holder the genuineness of it and of the prior indorsement; and this he did, to the extent of binding himself as indorser, whether the check was genuine or not, hut no further, and the holder, having neglected to charge him as indorser, has released him from that contract, and all that was incident to it.
If the defendant had passed the check to the plaintiffs and received from them the value of it, he would be bound to pay it back to them when it was ascertained that the signature of the payee, indorsed upon it to render it negotiable, was a forgery. But that is not the case. The defendant received the check from Stewart, with the name of the payee indorsed on it, in payment of a debt. After so receiving it he sent it by a servant to the Bank where he kept his account, for deposit and collection, and before doing so, indorsed his name upon it, because the rules of the Bank required that persons depositing checks should write their names across the back as owners. The Bank refused to take it for collection, and the servant then went with it to the Bank upon which it was drawn, where payment being refused, the servant, without direction or authority from the defendant, returned the check to Stewart, by whom it was passed to the plaintiffs.
The plaintiffs having, by their loches, discharged the defendant from his liability as indorser, can, upon this state of facts, have no further claim upon him. Their only remedy is against Stewart, to recover back from him what they gave him for the check.
The judgment should be affirmed. •