First Nat'L Bank v. Noble et al.

• Citation: 179 Or. 26,168 P.2d 354
• Parties: FIRST NATIONAL BANK OF PORTLAND <I>v.</I> NOBLE and THE UNITED STATES NATIONAL BANK OF PORTLAND
• Decision Date: 23 April 1946
• Court: Supreme Court of Oregon

179 Or. 26

168 P.2d 354

FIRST NATIONAL BANK OF PORTLANDv.

NOBLE and THE UNITED STATES NATIONAL BANK OF PORTLAND

Supreme Court of Oregon.

Argued January 8, 1946.

Modified April 23, 1946.

Rehearing denied June 11, 1946.

Money received — Assumpsit

1. In assumpsit for money had and received, plaintiff should show that defendant received money or something which was treated by the parties as money.

Payment — Intention of parties

2. When a debtor gives his own check or note to a creditor, prima facie the transaction is conditional payment only, but even in such case ultimate question is one of intention of parties to transaction.

Payment — Check — Proof

3. The mutual intention of parties that a check shall be given and received as payment may be established by proof of express contract or a contract implied in fact.

Banks and banking — Payment — Cashier's check

4. Where debtor's check is presented to drawee bank and exchanged for cashier's check of drawee, debtor's check being marked paid and surrendered, a strong case for final payment is made out since cashier's checks ordinarily pass current as money in everyday business transactions and right of countermand applied to ordinary checks does not exist as to a cashier's check.

Banks and banking — Payment — Cashier's check

5. The existence of an option on part of bank which had accepted for collection a check drawn on drawee bank to accept cash or cashier's check from drawee, coupled with election to take cashier's check and accompanied by surrender of original item to drawee, constitutes persuasive evidence of unconditional payment of the item.

Banks and banking — Checks — Collection

6. Where drawer's check was returned by drawee bank to collecting bank for insufficient funds, and two days thereafter collecting bank sent drawer's check by messenger who obtained drawee's cashier's check through mistake of drawee's employee, and clearing house rules did not apply to checks presented by messenger, drawee's right to restitution must be considered as if drawer's check had been paid over the counter in cash by drawee.

Payment — Mistake of fact

7. Generally, money paid to another under influence of mistake of fact may be recovered provided payment has not caused such change in position of payee that it would be unjust to require a refund, and test determining whether recovery may be had is whether defendant in equity and good conscience is entitled to retain money which plaintiff claims.

Payment — Mistake — Negligence

8. Generally, failure of payor to exercise ordinary care to avoid mistake will not as matter of law defeat his recovery, but ignorance of facts must be excusable and must not arise from intentional neglect of party to investigate them, and negligence may be relevant in determining whether it is equitable to allow recovery.

Payment — Mistake — Restitution

9. Restitution is not necessarily allowed for every payment of money by mistake, and payments induced by mistake of law are not recoverable.

Payment — Mistake — Restitution

10. Money paid as volunteer with knowledge of facts and not induced by duress or fraud cannot be recovered back, and even in case of payments made by mistake of fact, restitution may be denied.

Bill and notes — Acceptance of instrument

11. The statute providing that acceptor by "accepting" instrument engages that he will pay it according to tenor of his acceptance and admits certain facts, includes payment as well as acceptance of a bill.

Bills and notes

12. A payee of a negotiable instrument is a "holder" and may be a "holder in due course" if he brings himself within provisions of statute defining a holder in due course.

Banks and banking — Checks — Payment

13. Drawee bank which, through mistake of its employee, issued cashier's check to collecting bank's messenger in payment of drawer's check which had been marked "N.S.F." two days before, was not entitled to restitution from collecting bank's depositors to whom drawer's check was payable on theory that it was unconscionable to present drawer's check to drawee two days after check was marked "N.S.F.", where neither depositors nor collecting bank knew or were entitled to know the state of drawer's account.

Banks and banking — Checks — Payment — Mistake

14. Where drawee bank returned drawer's check to collecting bank for insufficient funds, and two days thereafter collecting bank sent drawer's check by messenger who obtained from drawee cashier's check through mistake of drawee's employee, and clearing house rules did not apply to checks presented by messenger, cashier's check constituted absolute payment and hence drawee was not entitled to restitution from collecting bank's depositors to whom drawer's check was payable.

Appeal and error — Banks and banking — Checks

15. In drawee bank's action for restitution from collecting bank's depositors to whom check was payable for amount of check paid by mistake, wherein collecting bank interpleaded, order discharging collecting bank upon paying of proceeds of check into court which order did not determine rights of other parties, was not appealable.

Appeal and error — Final decree

16. The question as to propriety of intermediate decree on interpleader was raised by appeal from final decree disposing of case on the merits.

Interpleader — Test for interpleading

17. The test in determining whether interpleader should be allowed is whether litigation between rival claimants will fully determine all of issues.

Interpleader — Double vexation

18. The office of "interpleader" is not necessarily to protect against double liability, but is to protect against double vexation with respect to one liability.

Interpleader — Final determination

19. Where if there was a right to restitution of money paid by drawee bank by mistake, drawee was entitled to money held by collecting bank, and if there was no right to restitution, collecting bank's depositors were entitled to the money, trial court properly entered decree requiring drawee bank and depositors to interplead, and discharged collecting bank from liability, since a decision of issue between the parties would constitute a final determination of all the issues.

Interpleader — Attorneys' fee

20. Where trial court properly entered decree requiring parties to interplead, court could in its discretion award a reasonable attorneys' fee.

HAY, J., dissenting.

                  See 7 Am. Jur. 379; Right to stop payment on cashier's check
                notes, 56 A.L.R. 532, 107 A.L.R. 1463; see also, 9 A.L.R. 960 and
                62 A.L.R. 374
                  168 P. (2d) 354
                

IN BANC.

Appeal from Circuit Court, Multnomah County.

MARTIN W. HAWKINS, Judge.

H.B. Beckett, of Portland (Wilbur, Beckett, Oppenheimer, Mautz & Souther, and R.K. Powell, all of Portland, on brief), for appellants.

R.R. Bullivant, of Portland (Pendergrass, Spackman & Bullivant, and C.E. Wright, all of Portland, on brief), for respondent First National Bank of Portland.

Wilber Henderson, of Portland (Platt, Henderson, Warner, Cram & Dickinson, of Portland, on brief), for respondent United States National Bank of Portland.

REVERSED AS TO FIRST NATIONAL BANK; AFFIRMED AS TO UNITED STATES NATIONAL BANK. REHEARING DENIED.

BRAND, J.

The plaintiff First National Bank of Portland (Oregon) instituted this proceeding as an action in assumpsit against the defendants Lillian S. Noble and John C. Noble and the United States National Bank of Portland (Oregon). Plaintiff seeks restitution in the sum of $10,573.50, the amount of a cashier's check issued by the First National to the U.S. National. The U.S. National filed a bill in interpleader alleging that it was disinterested as between the parties and tendering the money into court. The interpleader was allowed and an order entered discharging the U.S. National of all liability. By assent of the parties, the case was tried below as a suit in equity. The plaintiff prevailed against the defendants Noble who appeal.

BRAND, J.

The facts are as follows: John C. and Lillian S. Noble had purchased certain property from T.D. Lee through Kelleck, a broker. Subsequently by written agreement the sale was rescinded. In accordance with the agreement, the property was reconveyed. Mrs. Noble paid T.D. Lee $693.49 in adjustment of items which had arisen while the Nobles were in possession of the property and before the rescission; and E.C. Kelleck, who did business as the West Coast Brokerage Company, on September 21 drew and issued a check for $10,573.50 on the drawee First National Bank, payable to Lillian S. Noble to whom it was delivered. The Nobles received the Kelleck check in good faith and for value. Before noon of the same day, Mrs. Noble indorsed the check in blank and deposited it in the U.S. National Bank. Twenty-five hundred dollars was deposited in their joint checking account, the balance in their joint savings account. These deposits appear as credits to the Nobles in the ledger and savings pass book, respectively, under date of September 21.

The rules printed in the savings pass book and on the commercial deposit slip were substantially the same. They provide that checks and drafts are credited conditionally — may be charged back "if not found good" — and that the bank will be liable only where actual funds or solvent credits come into its possession.

On September 21 the U.S. National placed its clearing house indorsement on the back of the Kelleck check, but according to custom the stamp was dated September 22, the day for final settlement through the clearing house. The Kelleck check reached the First National on September 22. Reference to the Kelleck account disclosed that he had a credit of only $200. The check, therefore, was referred to Mr. T.D. Peters, assistant cashier of the First National. Peters placed on the lower left hand corner of the face of the check a small symbol, the meaning of which was known only to himself and to certain persons in the bookkeeping department and which indicated...