Court Opinion

ID: 6516053
Source: CourtListenerOpinion
Date Created: 2022-07-19 18:26:46.603253+00
Date Added: 2024-06-11T15:55:01.660465
License: Public Domain

HARALSON, J.
— 1. Of course, if the plaintiff suffered no damage from the failure of the collecting banlc,— the Eufaula National, — to present the check in time to the McNab Bank for payment on the day it was drawn, he had.no cause of action against the defendant. 2 Dan’l on Neg. Ins., § 1587 ; Boone on Banking, §§ 172, 181; Industrial Trust, Title & Sav. Co. v. Weakley, 103 Ala. 458. The first count fails to aver or show that the plaintiff suffered any damage from the neglect of the Eufaula Bank, and was, therefore, subject to the demurrer interposed.
2. The rule is well settled generally, in reference to the time within which checks must be presented for payment, that if the bank on which the check is drawn, be in the same place where - the payee receives it, it should be presented for payment within banking hours on the day it is received, or at latest within banking hours on the following day. — Industrial Trust, Title & Sav. Co. v. Weakley, 103 Ala. 458, supra.
But, there seems to be a well recognized qualification of this rule, where the check is taken by a collecting agent for another to whom the drawer of the check is indebted, and for which he gives the collecting agent his check. In such case Mr. Morse says : “ When a check is taken instead of money, by one acting for others, a delay of presentment for a day, or for any time beyond that within which by reasonable diligence it can be presented, is at the peril of the party so retaining the check, as between him and the true owners and parties in interest represented by him. Thus where the payee of a draft took from the drawees their check for the amount, which during banking hours on that day would have been honored, but which was retained by the payee until the day following, when it was dishonored, it was held that the payee could not have any remedy against the-drawer. As between the payee and the drawee the presentment of the check had been *388'made with due promptitude ; but as between the payee and the drawer there had been laches by reason of the payee not having presented the check and reduced it to money on the same day on which he received it. The payee had in fact, so far as the drawer was concerned, given to the drawee an extension of credit for one day, and the payment had been lost directly in consequence of such unauthorized extension.” — 2 Morse on Banks & Banking, § 421'. And again, the same author says in section 428: “The payee (or his agent) cannot enlarge the time by taking a check instead of money, and waiting till next day to see if it is good. If he takes a check, he must collect it the same day ; he cannot have till the next day to present the check, for it was his duty to secure payment on that day, not the next day, and a check is not payment.”
In the case at bar, the defendant bank, — the collecting bank and agent for the Mound City Distilling Co. — having received from said company the plaintiff’s acceptance, presented the same for collection at maturity. Instead of paying the money, the plaintiff gave his check for the amount of his debt, drawn on the John McNab Bank in Eufaula, payable to the defendant bank. The check was received on March 30th, 1891, about 10 o’clock A. M., and was not presented until the next day, the 31st. The McNab Bank was good, and honored all checks on the 30th, and suspended at the close of business hours on that day. The plaintiff had money at McNab’s, and his check, as is alleged, would have been paid if presented on the 30th. The complaint does not aver that the draft for which the check was given was surrendered to the plaintiff when he gave the check: and construing it most strongly against the pleader, we presume it was not surrendered, but was retained by the defendant, to await the collection of the check. It was not received in absolute payment of the. plaintiff’s acceptance, and the debt due by the draft was not discharged. The check was received to become operative as a payment in fact, only when paid by the drawee. Story on Bills, §419; Smith v. Miller, 43 N. Y. 171. The next day, the 31st of March, the day of the suspension of the McNab Bank, the plaintiff paid his bill to the Mound City Distilling Co., to -the defendant, and took up his check. This he was bound to do, for, as for any*389thing yet occurring, he still owed his debt to the Mound City Distilling Company. But he claims, that when he gave his check to the defendant bank, in place of •money, to be collected and applied to his draft, there was an implied obligation on the part of defendant to him, to present said check with clue diligence to the drawee for payment, which obligation it failed to discharge, in consequence of which, though he was yet bound to pay the draft, he suffered damage to the extent of the sum for which the check was given. This is a question with which the owners of the draft, — the Mound City Distilling Company, — have nothing to do. As to that company, the defendant had no right to take anything but money for the draft, and, indeed, did not pretend to do so. When it took the check from plaintiff, its taking became a transaction between defendant and plaintiff; defendant became the agent of and owed plaintiff the duty to act promptly in the collection of the check. The check when given was esteemed good by plaintiff and defendant, and it was good. The plaintiff did no wrong to give the check for the purpose intended ; but in taking said check, as we have stated, the defendant at once assumed a relation and duty to its drawer, and had no right, as to him, to enlarge the time of its payment for a day, but should have presented it — there having been ample time in which to do so — the very day it was drawn ; and failing, it owes the plaintiff the amount of the check and interest. — Authorities supra-, Smith v. Miller, 48 N. Y. 171; s. c. 52 N. Y. 546 ; Chauteau v. Rowse, 56 Mo. 65 ; Clarke v. Gates, 67 Mo. 139.
The demurrer to the complaint should have been overruled.
Reversed and remanded.