Court Opinion

ID: 8121555
Source: CourtListenerOpinion
Date Created: 2022-09-09 14:57:18.357351+00
Date Added: 2024-06-11T16:39:01.583259
License: Public Domain

Foster, D. J.,
dissenting. 1 cannot concur with the circuit judge as to the law of this case. My views are fully presented *264in an opinion written on the former trial of the ease, and I need hut add a few lines more. It will be seen I then based my decision on the doctrine established by the supreme court in the case of Hoover, Assignee, v. Wise, 91 U. S. 308-13, and upon that case I now stand.
While it is true the facts in that case are not altogether similar to the facts here, yet that case did fairly present the question as to privity of action between the principal and an agent appointed by his agent, and it was decided that no such privity existed.
On page 311 the court say: “Without attempting to harmonize or to classify the conflicting authorities, we think the case before us falls within a particular range of decisions in which the preponderance is undoubted. Among these are the following: Reeves & Co. v. State Bank of Ohio, 8 Ohio St. 465; Mackersy v. Ramsays, 9 Clark & Fin. 710-818; Montgomery Co. Bank v. Albany City Bank, 7 N. Y. 459; Allen v. Merchants' Bank, 22 Wend. 215; Com. Bank v. Union Bank, 11 N. Y. 203.”
It will be seen, from the opinion itself, that the cases which are cited approvingly by the supreme court establish the doctrine that a person or bank employed by a principal to make a collection cannot appoint another person or bank to transact the business, and make the latter the sub-agent of the principal. The court then says: “These cases show that where a bank, as a collection agency, receives a note for the purposes of collection, that its position is that of an independent contractor, and that the instruments employed by such bank in the business contemplated are its agents, and not the sub-agents of the owner of the note. * * * There are, doubtless, cases to be found holding to the contrary of these views, but the principle they decide is nevertheless well established. Cases, no doubt, may also be found where actions have been sustained by the creditor against the last agent, or where he is charged with his acts, in which the point before us was not raised or brought to the notice of the court, íáuch cases are not authority on the point. Nor do we think that any great difficulty arises from the case of Wilson v. *265Smith, 3 How. 763-70. That decision is based upon the case of Commonwealth Bank v. Bank of New England, 1 How. 234, which is the only case referred to in the opinion, and in which case the question was not raised.”
If this language does not override the doctrine enunciated in Wilson v. Smith, the principle this case clearly establishes, and the long array of cases cited with approbation, and which cannot be reconciled with Wilson v. Smith, it seems to me must he held to overthrow that case. That I am not alone in this construction of the Hoover v. Wise Case, I refer to the case of Hyde v. First Nat. Bank, 7 Biss. 156, and First Nat. Bank of Crown Point v. First Nat. Bank of Richmond, decided by the supreme eourtof Indiana, November term, 1878, both of which cases rest upon this construction of the Hoover v. Wise Case. In these cases the several indorsements were restrictive indorsements, showing that the paper passed through several banks for collection, as in the case at bar, and in the Indiana case the defendant bank had notice of the failure of its correspondent, the Cook County Bank, before collecting and crediting the money. In these cases the Hoover v. Wise Case is cited as establishing the doctrine that no privity of action exists between the first creditor and the last collecting agent. In other words, a collecting agent cannot appoint sub-agents for the first creditor. The bank from which the defendant received the paper is its principal, and to which it is alone answerable, and by its principal in this case it was ordered to collect for, and credit to the account of, the Mastin Bank. It obeyed that order, and that too before it knew of the failure of the Mastin Bank. It will be seep, by the plaintiffs amended petition in this case, that it sues the Beno County Bank as its agent, placing its right of action on the ground that the Beno County Bank collected the money, not for the Mastin Bank, but for tlie Chicago Bank. Indeed, it could not place its right of action on any other ground, for no one would contend that it could be sued as the drawee of the paper.
I am aware there is a direct conflict on this question among the state cases, but what I hold is that, the Hoover v. Wise *266Case, and the decisions it cites and approves, clearly establishes the doctrine that I contend for, and the last decision of the supreme court relieves me from any attempt to reconcile these conflicting decisions of the state courts.