Court Opinion

ID: 6432892
Source: CourtListenerOpinion
Date Created: 2022-06-25 12:09:51.826193+00
Date Added: 2024-06-11T15:52:16.226178
License: Public Domain

Lobing, J.
The only question on this report arises under the defendant’s declaration in set-off. The undisputed facts were in substance these: For some time before April 8, 1913, one Gleason had been the lessee of the Hotel Westminster. On that day the defendant and another, who were the legal owners of the hotel, brought the lease to an end for breach of condition. Thereafter the defendant “personally kept the hotel running through the agency of McGrath until May 1 when a new lease could be negotiated with McGrath or some one else.”
On April 1 Gleason owed the plaintiff for wines and liquors to an amount not stated in the report. On or about April 2, “the plaintiff’s salesman called and asked for a payment on Gleason’s account, and McGrath drew a check for $500 dated April 12 and gave it to the plaintiff.”
This check was drawn on an account in the Exchange Trust Company opened by McGrath “on or about April 1, 1913.” It is stated in the report that McGrath deposited to the credit *185of this account “some of Ms own money.” It is also stated that “thereafter [he] deposited in it the receipts of the hotel, wMch up to April 8 belonged to Gleason, and paid the bills of the hotel out of it.” It is further stated in the report that McGrath (on or about April 1, when the account was opened) “was employed as steward at the hotel,” and “was planning to become a partner of Gleason or else to become the sole lessee of the hotel in place of Gleason on the succeeding May first.”
McGrath, wMle running the hotel as the defendant’s agent after April 8, used Ms own bank account opened on April 1, 1913, as stated above.
On April 12, 1913, the plaintiff deposited McGrath’s check for $500 in Ms own bank, and it went through the clearing house on April 14. The check was not returned to the trust company before one o’clock, and by the rule of the clearing house the payment thus made became absolute at that time.
It is stated in the report that at the close of the evidence there were two facts only in dispute. The first related to the time when two checks (paid over the counter. and amounting together to $325) were paid. The jury found that they were paid before the payment of the $500 check here in question became absolute at one o’clock. It is admitted that under these circumstances “there was in that bank account only $15.53 of the money deposited before April 8 and not the defendant’s money. . . . The other matter in dispute was whether the plaintiff had knowledge when he deposited Ms check for payment that Gleason had ceased to have any interest in this bank account after April 8.” In answer to a question put to them the jury found that he had.* On these two facts being found by the jury in favor of the defendant the judge directed (1) a verdict for the plaintiff in the original action, about wMch, apart from the questions arising under the declaration in set-off there was no dispute; and (2) a verdict for the plaintiff in the declaration in set-off; and he reported the case to tMs court.
*186On these facts the defendant contends (first) that he is entitled to recover the $500 paid on this check, as money paid under a mistake of fact; or rather he concedes that he is not entitled to recover the whole $500. His position is that he is entitled to recover $500 less $15.53. “This $15.53 the defendant admitted was rightfully applied by the plaintiff to the reduction of Gleason’s account, thus reducing the defendant’s claim in set-off.” In the second place the defendant contends (to quote his own words) that the plaintiff “should repay him his money which Leavitt [the plaintiff] took and applied to pay Gleason’s debt,, with knowledge that the conditions had changed and that he had no right so to apply it.”
1. These facts fail to disclose any mistake made in the payment of McGrath’s check for $500. It may be that it was an act of carelessness or of stupidity on the defendant’s part to allow the receipts derived from running the hotel after April 8 (which were his) to be deposited to the credit of McGrath’s bank account.' In the sense that it is a mistake to be careless or stupid there was a mistake in this matter. But that did not make out a mistake in the payment of McGrath’s check for $500. The defendant has failed to prove, that a mistake was made by any one in the payment of that check.
2. On these facts it is not true (as the defendant contends) that the plaintiff cashed McGrath’s check “with knowledge . . . that he had no right ... to apply” the proceeds in payment of Gleason’s debt to him. In the first place it was not shown that the plaintiff, in taking McGrath’s check for Gleason’s debt, took it as Gleason’s check drawn by McGrath as his (Gleason’s) agent. Not only is it true that that fact was not established, but it is also true that it was not established that that was the fact. All that was established was that “the plaintiff’s salesman called and asked for a payment on Gleason’s account, and McGrath drew a check for $500 dated April 12 and gave it to the plaintiff.” Why and under what arrangement McGrath gave a check on his bank account in payment of Gleason’s debt was not established. It was established that that bank account was not Gleason’s bank account. It is stated that when it was opened McGrath deposited in it “some of his own money.” How much is not stated.
*187Under these circumstances the finding that the plaintiff was “informed that Gleason had ceased to have any interest in the McGrath bank account” before he cashed McGrath’s check for $500 was beside the mark. It was McGrath’s check (not Gleason’s) which was given to the plaintiff. There is no suggestion that the plaintiff was informed that McGrath had ceased to have any interest in the bank account before the check was drawn by him (McGrath). The defendant has failed to establish the fact that the plaintiff had no right to apply the check to the payment of Gleason’s debt, much less that he had knowledge of that fact.
It is not necessary to consider other objections in the way of the defendant’s recovering on his declaration in set-off.
In accordance with the terms of the report the entry must be

Verdicts to stand.

 The question put to the jury and answered by them in the affirmative was in these words: “5. Was the plaintiff, before he cashed the check No. 4 for $500 signed by John J. McGrath, which he applied to Gleason’s account, informed that Gleason had ceased to have any interest in the McGrath bank account?”