Court Opinion

ID: 6132620
Source: CourtListenerOpinion
Date Created: 2022-02-04 21:21:31.521275+00
Date Added: 2024-06-11T08:53:47.996134
License: Public Domain

Barnard, P. J.:
We think this case was properly disposed of at the circuit.
On the 1st of July, 1884, one L. Christian Meyer, a broker in foreign exchange, purchased of the defendants a bill on Hamburgh for 41,500 marks, payable to the order of the plaintiffs. The amount of the bill was not paid to the defendants either by the broker or by the plaintiffs. The defendants stopped the payment of the bill. The broker had delivered the bill to the plaintiffs. The broker owed the plaintiffs about $10,000, and they paid him $2,000 more, which made more than sufficient to pay for the bill. The broker failed on the 5th <?f July, 1884. It was proven that *368Meyer had purchased on many previous occasions, foreign exchange of the defendants for the plaintiffs. As between the parties to the bill there is no consideration for it and the defendants are not parties who have acquired any right under the law merchant.
The sole question is whether the broker was the agent of the defendants in selling the bill. "We think he was not. He offered to purchase in pursuance of a long course of business for the plaintiffs. He was in the habit of paying by his own checks and receiving the money from the plaintiffs in return. As well payment in this way as another, but when payment is not made the loss will fall on the purchasers who authorized the purchase and must see to it that the money they paid their broker got to the sellers of the exchange. The bill of exchange is therefore wholly without consideration, and void in the plaintiffs’ hands. The payment of the $2,000 at the time of the order of purchase does not affect the case. It was not a parting with value upon the faith of the bill. It was paid before the bill was purchased and only increased a balance in the plaintiffs account with the broker. If a bill be purchased by a broker for a party with a direction to pay for the bill out of the balance due from the broker, a purchase without payment furnishes no consideration for the bill as between the buyer and seller. (De Bras v. Forbes, 1 Esp. R., 117.)
The judgment should therefore be affirmed, with costs.
Dykman and Pratt, JJ., concurred.
Judgment and order denying new tidal affirmed, with costs.