Schuler v. Laclede Bank
Decision Date | 12 April 1886 |
Citation | 27 F. 424 |
Parties | SCHULER v. LACLEDE BANK and others. [1] |
Court | U.S. District Court — Eastern District of Missouri |
Dyer Lee & Ellis, for complainant.
Boyle Adams & McKeighan, for defendants.
In the case of Schuler against the Laclede Bank, which was submitted upon bill, answer, and agreed statement of facts, the suit is brought by the plaintiff as the payee of a check drawn by Israel & Co. on the defendant the Laclede Bank. The check drawn October 20th, was presented October 26th. Israel & Co. Failed, and made an assignment on October 24th, of which notice had been received by the Laclede Bank, who decline paying.
The first question is whether an action at law or a suit in equity can be maintained by the payee of such a check against the drawee, under any circumstances, and, if so, under what. That no action at law can be maintained in the federal courts is clear. In the case of Bank v. Millard, 10 Wall 152, the supreme court held that 'the holder of a bank-check cannot sue the bank for refusing payment, in the absence of proof that it was accepted by the bank, or charged against the drawer. ' The same doctrine was affirmed in a later case of Bank v. Whitman, 94 U.S., 343. 'The payee of a check, before it is accepted by the drawee, cannot maintain an action upon it against the holder, as there is no privity of contract between them.'
In the case of Christmas v. Russell, 14 Wall. 69, in reference to what constitutes this matter as to whether there is an equitable assignment, the court say:
In 2 Daniel,Neg.Inst. § 1638, the author, who criticises this doctrine of the supreme court, states that citing Central Bank v. Life Ins. Co., (104 U.S. 54,) decided in 1881. That logical sequence, as he contends, would be that such a check operates as an equitable assignment, and that a suit in equity can be maintained thereon.
These are the chief rulings and expressions of opinion on the part of the supreme court in this respect. I think it is clear from them that no action at law, and no suit in equity, can be maintained upon the mere possession of such a check; that there must be, besides the possession of the check, some other circumstances which either create a contract between the payee and the bank or which equitably require that the funds in the possession of the bank should be appropriated to the payment of the particular check.
Over against these decisions of the supreme court I find these in this circuit: One in the case of Walker v. Seigel, reported in 2 Cent.Law J. 508, in which my Brother TREAT states the rule thus:
In German Sav. Inst. v. Adaw, 1 McCrary, 501 S.C. 8 F. 106, after the insolvency of, and a general assignment by, the drawer, the bank came into this court by a bill of interpleader and tendered the money, brought in the payee and the assignee of the drawer, and asked the court to dispose of the fund; and the court, holding possession of the fund, as between the drawer of the check and the payee declared that the payee was entitled to it, and so gave judgment.
In a still later case of First Nat. Bank v. Coates, reported in 8 F. 540, the Mastin Bank had drawn on the Metropolitan Bank of New York several checks. On presentation, the Metropolitan Bank refused to pay, having previously received notice of an assignment by the Mastin Bank, and turned the money over to the assignee, Coates. These various check-holders then brought a suit in equity against the assignee having possession of this money, claiming that, as between themselves and the assignee who represented the drawer, they had an equity upon it superior to the general creditors of the Mastin Bank; and Justice MILLER, the presiding justice of this circuit, held that they had, and in the course of the opinion he says:
And further on he says:
That justifies me in the conclusion which I have just expressed that no suit in equity ever can be...
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