Taft v. Quinsigamond Nat. Bank

• Decision Date: 06 January 1899
• Citation: 52 N.E. 387,172 Mass. 363
• Parties: TAFT v. QUINSIGAMOND NAT. BANK.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

172 Mass. 363

52 N.E. 387

TAFT v. QUINSIGAMOND NAT. BANK.

Supreme Judicial Court of Massachusetts, Worcester.

January 6, 1899

COUNSEL

Geo. S. Taft, in pro. per.

F.P Goulding and W.C. Mellish, for defendant.

OPINION

BARKER J.

The action is said by the bill of exceptions to be a suit to recover the amount of a check deposited by the plaintiff in the defendant bank, and credited to him upon deposit, and afterwards charged back by the bank. The declaration has two counts,--one for refusal to pay the plaintiff's check drawn upon the defendant, and the other upon an account in which the defendant is debited with the amounts of the plaintiff's deposits, and with the protest fees on his dishonored check, and is credited with the amount of his checks paid by the defendant; the balance being the amount for which, with interest, the court below found for the plaintiff. Whether the bank was indebted to the plaintiff and bound to honor his check, depended upon the dealings with reference to the check which he deposited on August 2, 1897 and the amount of which was charged back upon the writing up of his pass book, on November 19, 1897.

The defendant contends that the finding that it became at any time a purchaser of the deposited check was unwarranted. But the purchase of negotiable paper by a bank is as clearly within its legitimate powers as is the collection of such paper by the bank as an agent. The deposit of money by a customer to his credit in a drawing account, without more creates between the bank and the customer the relation "of debtor and creditor, not of agent and principal." Carr v. Bank, 107 Mass. 45. So, when, without more, a bank receives upon deposit a check indorsed without restriction, and gives credit for it to the depositor as cash in a drawing account, the form of the transaction is consistent with, and indicates, a sale, in which, as with money so deposited, the check becomes the absolute property of the banker. The matter may be regulated by statute, as in the state of New York, or there may be general usages of business obtaining in the locality which color the transaction. So, a bank, by general notices printed on its pass books or deposit slips, or otherwise brought to the knowledge of its depositor, or by agreement with the particular depositor as to his own deposits, or by crediting negotiable paper as paper, and not as cash, or by a particular contract in any special instance, may define its position as that of agent or purchaser. Usually the cases in which a bank is held to have been only an agent for collection have, as a controlling element, evidence of usage or notice or particular agreement. In the present case there was no evidence of usage or custom, nor was it shown that ...