Nolan v. Bank of New York National Banking Association. 176. Barnes v. Ontaria Bank, 19 id., 159. Merchants' Bank v. State Bank, 16 Wallace, 647. III. The obligation assumed by the defendants, when the check was certified, being that of an acceptor of a bill of exchange, equivalent, as shown by the authorities cited, to that of a maker of a demand note, it has been held that after reasonable period has elapsed for presentment, this check is to be treated and considered as an overdue obligation. (See Herrick v. Woolverton, 41 N. Y., 581.) It therefore follows that the plaintiff could not, receiving this check at the time she did, become in judgment of law a bona fide holder thereof, so as to overcome the equities existing between the bank and Meyer & Greve, the previous holders to whom the check was paid, and hence the court, as matter of law, properly instructed the jury to find for the defendants. IV. The instrument in question having a certain defined character in the law, and its capacity for negotiation when dishonored or overdue in judgment of law, being settled by the law, which also determines the legal position of the party taking the same when so dishonored, any custom of the mercantile community, such as was offered to be shown, was incompetent and irrelevant, and was properly excluded. To show that certified checks were received in New York as representing the amount in gold they bore on their face, would have no legal weight on the question of title of the plaintiff—a woman not in business-acquired in New Orleans, and no offer was made to prove the custom in New Orleans. To show a custom to keep them in circulation without presentment, as an answer to the legal consequences of that act would be incompetent. (See Wheeler v. Newbould, 16 N. Y., 392, 402). V. The question of bona fides of Mrs. Nolan's ownership was a question of law, and not of fact, and, therefore, no error was committed by the court in refusing Nolan v. Bank of New York National Banking Association. to submit that question to the jury. 1. In no aspect of the case can plaintiff be truly considered a bona fide holder of the check. She did not receive the same in the usual course of business, and without notice of facts tending to impeach the validity of the paper. She had distinct notice, from the date of the check, that there was an irregularity somewhere. A check so certified is said by Gould, J., in Claflin v. The Farmers' and Citizens' Bank, to have no time to run, and credit in the light of time given is no element of it. Yet, in the face of this irregularity, in a city different from that on which the check was drawn, she loans to a perfect stranger $4,000. 2. Plaintiff lacks every element of bona fides and value. She was not in business, nor did she receive it in any course of business. The contrivance of bringing in a woman to represent the title is old and stale, and evidence that no business man would have touched it. A woman who goes out of her way to dabble in what she calls business, must take its result, and cannot shelter herself under the privilege that she was a woman, and knew nothing of business. 3. She did not purchase this check, which is the only excusable case in which any rule of value can be invoked for her protection, nor did she loan on it, because she loaned on the obligation of a third party, and the assurances of a friend who acted as the go-between. By the Court, BRADY, J. The view adopted on the trial of this action seems to have been, that the check in judgment of law was dishonored at the time of its transfer to the plaintiff, and therefore subject to all the equities existing in favor of the owners at the time it was stolen. The check is dated 21st of Jan. 1865, drawn by M. Morgan's Sons, payable to their own order and indorsed by them. It was, on or about that date, accepted by the defendants and not only certified to be good, but registered. On the 4th of February, 1865, it was in the Nolan v. Bank of New York National Banking Association. possession of the firm of Meyer & Greve of this city, and on that day stolen from their book-keeper. It appears that notice of the theft was given to the defendants, or the payment of it stopped, on the same day, and that nothing further was heard of it by Meyer & Greve until May or June of 1868. The circumstances disclosed seem to establish that the check was designed for circulation, and not for immediate payment by the defendants. It was in the hands of Meyer & Greve as late as the 4th of February, but it does not appear in what manner they obtained it. Whether it was passed to them by the drawers or reached them through a line of holders does not appear. The plaintiff gave value for it, and took it in a legitimate manner. Regarding it as worth its face and desirous of investing her money, she made the only inquiries which she was called upon to make, before accepting it. If the signatures to the check and certificate were genuine, she was not bound by anything appearing upon the face of it, to exercise any other caution, vigilance or diligence, so far as the defendants were concerned. They had appropriated the funds to pay the check. It was in fact paid by the drawers because the certificate and registry was not only a debit against their account and a withdrawal of its amount from their funds, but an appropriation of such sum for the holder, whoever he might be. The check was honored, therefore, because it was accepted, and so far as the drawers were concerned, was by such acceptance paid. If the holder after acceptance and certification delayed presentation for payment, it was to his prejudice only. He might lose the interest which he could have made by proper investment, but whether he thought such a result judicious or not, was a matter resting entirely within his own power or discretion. The proposition, therefore, that from the delay in presenting it for payment, it might be deemed dishonored like a promissory note payable on demand is utterly untena Nolan v. Bank of New York National Banking Association. ble. The answer to it is that the check was not dishonored; on the contrary it was paid by the drawers by an absolute appropriation of their funds to meet it, which the defendants held for the transferee, whoever he might be. No element of this kind marks the circulation or transfer of the promissory note which has not been paid, and for which no fund has been specially created. We were not referred to any case maintaining the proposition stated, and none has been found. The certificate "imports that the drawer has funds or means convertible into funds, in the hands of the drawee, at the time, which shall be retained and devoted to the payment of the paper on presentation. If it does not mean this it is a sham and a snare." BROWN, J., in Farm. and Mech. Bank v. B. and Drov. Bank (28 N. Y. Rep., 428,) says: "Unless the word good, as said in Massey v. The Eagle Bank, (9 Metcalf, 309,) carries with it a binding evidence of the fact that the money is in the bank to meet that particular check, and that it will be paid to bearer at any time when presented, it is of no practical utility." "Checks drawn upon banks or bankers thus marked and certified enter largely into the commercial and financial transactions of the country. They pass from hand to hand in the payment of debts, the purchase of property, and in the transfer of balances from one bank to another. In the great commercial centres they make up no inconsiderable portion of the circulation, and thus perform a useful, valuable, nay, an almost indispensable office." These are views also expressed by BROWN, J., in the case (28 N. Y.) above cited, and are utterly inconsistent with the proposition that checks may not at any time during the running of the statute of limitations be employed in the manner indicated. Chief Justice DENIO (14 N. Y. Rep., 624,) said: "The object of a dealer, in procuring his check to be certified, is to enable him to obtain credit with others who might not be willing to Nolan v. Bank of New York National Banking Association. trust to his personal representations of the existence of funds to meet the draft, or his assurance that he would not withdraw them to the prejudice of the holder. This effect belonging to certified checks enables them to be extensively used in payments and settlements at the place where they are drawn and, to a more limited extent, as remittances to other places." The character thus assigned these instruments, makes them in effect a circulating medium capable of being passed from hand to hand by delivery and chiefly upon the credit of the bank as primary liable. And hence lies the difference between them and inland bills of exchange which, for the purpose of charging the various parties, they are considered to resemble. The object of certifying the check is to give it currency-is to induce third persons to accept it freely as they would bills of the bank; and hence it does not lie with the bank to assert that though the bill was good on the day it was certified, it has since become worthless by the withdrawal of the drawer's funds. Unless the certificate be treated as a compact or agreement that the check shall be paid, it fails to answer the purpose for which it is sought and given. (Edwards on Prom. Notes and Bills, 406, 407.) "The sole and manifest object of the maker or holder of a check, in requiring it to be certified, is to enable him to use it as money." (Per Oakley, J., in Willetts v. The Phænix Bank, 2 Duer, 121;) and again he said : "The certificate is a useless form unless it means, not merely that the check was good when certified, but that it will be good when presented for payment. * * * The obligation of the bank is simple and unconditional, to pay upon demand, and in all such cases the demand may be made whenever it suits the convenience of the party entitled to the stipulated payment." The certificate is to be regarded as an acceptance payable on demand, and was obligatory until paid or the statute of limitation should attach as a bar. (Mead v. Merchants' Bank of VOL. LXVII. 3 |