Court Opinion

ID: 6230502
Source: CourtListenerOpinion
Date Created: 2022-02-17 20:20:50.791526+00
Date Added: 2024-06-11T08:57:50.768879
License: Public Domain

The opinion of the court was delivered by
Strong, J.
— Assuming that the affidavit of defence is sufficiently positive in its averments, it presents the following case: The holder of a draft, drawn and endorsed by Henry Heil, and discounted for him by the Lancaster Bank, obtained it from the bank as collateral security for the payment of a pre-existing debt, with knowledge at the time that the bank had failed. The proceeds of the draft, with those of other paper discounted at the same time, had been placed to the credit of a certain Heil & Hammer in that institution, and remain undrawn. Does this, without more, constitute a defence to a suit by the holder against the drawer, after the draft has been dishonoured and notice of dishonour given ? Certainly the holder is in no worse condition than that of the party from which the draft was taken. When it was discounted the Lancaster Bank parted with its money, and Heil & Hammer obtained a new credit for it. When not paid at maturity, the bank could not have applied Heil & Hammer’s money to its payment, nor refuse to pay their checks. There was, therefore, no want or failure of consideration between the bank and Henry Heil, nor does the affidavit show any right to defalcation. It does not aver that Henry Heil was a member of the firm of Heil & Hammer; and, even if he was, it is not asserted that his co-partners assented to his use of a debt due them as a protection against his individual liability, without which assent it clearly could not have been used as a set-off. Upon his own showing, then, the plaintiff in error had no defence against the Lancaster *138Bank, and surely no more against the bank’s endorsee. The judgment was therefore rightfully rendered non obstante juramento.
The judgment is affirmed.