Hatch v. First Nat. Bank of Dexter

• Decision Date: 30 October 1900
• Citation: 47 A. 908,94 Me. 348
• Parties: HATCH v. FIRST NAT. BANK OF DEXTER.
• Court: Maine Supreme Court

47 A. 908

94 Me. 348

HATCH

v. FIRST NAT. BANK OF DEXTER.

Supreme Judicial Court of Maine.

Oct. 30, 1900.

(Official.)

Exceptions from supreme Judicial court, Penobscot county.

Action by Melinda Hatch against the First National Bank of Dexter. Verdict for plaintiff, and defendant excepts. Overruled.

Assumpsit upon a certificate of deposit issued to one Olive Hodge by the defendant bank, and claimed by the plaintiff as a gift by indorsement and delivery before the death of the donor.

Besides the facts stated in the opinion of the court, it appears from the bill of exceptions that the plaintiff presented the certificate at the First National Bank of Dexter on May 3 or 4, 1897, and requested the payment of $50, which the cashier paid to her, but at the same time requested her to promise that she would get Olive Hodge to indorse the certificate, otherwise he would not pay any more money on the certificate; which Mrs. Hatch, the plaintiff, promised to do. Subsequently, on the same day, May 4, 1897, Olive Hodge did indorse her name on the certificate; and on the trial it was a question of dispute between the parties as to whether Olive Hodge, at the time of her indorsement, made a gift of the certificate to the plaintiff as her property,—the plaintiff contending that it was a gift to her, and the defendant contending otherwise, and that it belonged to the estate of Olive Hodge, who died July 22, 1898.

It was admitted by both parties that her death occurred on that day, and that nothing had been paid by the defendant on the certificate previous to her death, except as appears indorsed on the certificate.

Subsequently to the 22d—the day of her death—plaintiff presented the certificate to the cashier, and requested payment, to which request the cashier testified that he would pay no more on the certificate to plaintiff for the reason that he had been forbidden by Joel C. Pease, the executor of Olive Hodge's will, from paying it; that said executor claimed that it belonged to the estate of said Olive Hodge.

The defendant requested the court to instruct the jury that, if it was a mere gift made by Olive Hodge to the plaintiff in manner aforesaid, it would not authorize her (the plaintiff) to demand payment of the balance remaining unpaid represented by the certificate, but still unpaid after her death. The court refused to give the instruction, to which the defendant duly excepted.

Argued before EMERY, WHITEHOUSE, SAVAGE, FOGLER, and POWERS, JJ.

L. B. Waldron, for plaintiff.

J. & J. Willis Crosby, for defendant.

SAVAGE, J. This action is brought by the plaintiff as indorsee on a certificate of deposit of the following tenor:

"The First National Bank, Dexter, Maine, Jan. 6th, 1897.

"Olive Hodge has deposited in this bank five hundred and sixty dollars, payable in current funds to the order of herself on return of this certificate properly indorsed.

"Int. at 3% per annum if on deposit 6 mos.

"No. 2,236. C. M. Sawyer, Cashier."

The defendant requested the presiding justice to rule that the action could not be maintained by the plaintiff, as indorsee, for the reason that the certificate of deposit in question was not a negotiable instrument. The presiding justice declined so to rule, and the defendant excepted.

The defendant contends that the instrument is nonnegotiable for three reasons: First, because it was written payable in "current funds"; secondly, because of the clause, "Int. at 3% per annum if on deposit 6 mos.;" and, lastly, because of the condition of payment expressed in the words, "on return of this certificate properly indorsed."

That a certificate of deposit, as such, is a negotiable instrument is held by almost unanimous authority (2 Daniel, Neg. Inst. § 1702; Miller v. Austen, 13 How. 218, 14 L. Ed. 119), and is not here denied by the learned counsel for the defendant. They only contend against certain features in the certificate before us. This court, following universal authority, has recently defined a negotiable instrument to be one which runs to order or bearer, is payable in money, for a certain, definite sum, on demand, at sight, or in a certain time, or upon the happening of an event which must occur, and payable absolutely and not upon a contingency. Roads v. Webb, 91 Me. 406, 40 Atl. 128. If the certificate in question does not conform to these requirements, it must be held to be nonnegotiable.

The first objection is that it is not made payable in "money"; that "current funds," in which it is made payable, should not be judicially interpreted to mean "money." We do not think this contention should prevail. This subject has been discussed exhaustively by many courts, and the conclusions they have reached on the one side and the other are not in harmony. But we think that the modern and better doctrine is that the term "current funds," when used in commercial transactions as the expression of the medium of payment, should be construed to mean current money, funds which are current by law as money; and that, when thus construed, a certificate of deposit payable in current funds is, in this respect, negotiable. It is well known that certificates of deposit are commonly made payable in "currency" or in "current funds," and we believe that the interpretation we have given is in accord with the universal understanding of parties giving and receiving these instruments; an understanding which we should resort to as an aid to interpretation, unless the words themselves fairly import some other meaning. Some courts hold that evidence may be received to show the meaning of the terms "currency," "current funds." But, in the absence of evidence, these courts come to opposite conclusions. For instance, in Iowa, the court holds that notes payable in currency are prima facie nonnegotiable, but that evidence may be received to prove that the word "currency" describes that which by custom or law is money, and thus the instruments may be shown to be commercial paper. Huse v. Hamblin, 29 lowa, 501. On the other hand, in Michigan it was held that, where a certificate of deposit was made payable in currency, "prima facie, at least, that must be held to mean money current by law, or paper equivalent in value circulating in the business community at par." "Such, we think," said the court, "is the general signification, the fair import, and the ordinary legal effect of the term." Phelps v. Town, 14 Mich. 374; Insurance Co. v. Allen, 11 Mich 501.

Still other authorities hold that the terms "currency" or "current funds," used in commercial paper, ex vi termini mean money. Judge Campbell, in Black v. Ward, 27 Mich. 191, after a critical examination of a mass of authorities, declared that, with few exceptions, "the general course of authority is in favor of the...