jured by her hitting it accidentally with her thumb in trying to ward off a cockchafer that flew through an open window toward an electric lamp on a hot night, while the maid was sewing, has been refused compensation upon the ground that the accident did not arise out of her employment. Craske v. Wigan [1909] 2 K. B. (Eng.) 635-C. A. The court said: "The risk that a cockchafer may, on a hot summer evening, fly into a lighted room, is a risk, if a risk at all, which is common to all humanity, and bears no relation to the employment of a lady's maid. The fact that the appellant struck herself involuntarily, owing to the excessive susceptibility of her nerve centers produced by her alarm at the cockchafer, does not make this an accident arising out of the employment. The arguments on behalf of the appellant have been too extravagant to do more than provoke a smile. I feel a difficulty in dealing with them in a serious vein. The arguments have been full of amusement, but have carried with them no conviction." In Griffiths v. Robins [1917] W. C. & Ins. Rep. (Eng.) 44, 10 B. W. C. C. 90, an injury to a parlor maid from a needle sticking in her knee, she having left it in her dress which she had been repairing when called by her employer, was held to have not arisen out of her employment, being not a risk specially incident to it. In denying compensation to a cook who was injured by a fall in walking across a kitchen to get some water for washing towels, due apparently to wearing a slipper that did not fit, rather than to a slippery condition of the floor, the court remarked that, if such an accident should be held to arise out of the employment, it would appear to be impossible to avoid the conclusion that every domestic servant, so long as she is in her employer's house, is insured by her employer against any accident whatever. Hannifin v. Fitzmaurice [1921] W. C. & Ins. Rep. 143, [1921] 2 Ir. R. 44, 55 Ir. L. T. 65, 14 B. W. C. C. 320—C. A. e. Miscellaneous. An injury to the manager of a livery stable who lived on the top floor of the stable building, from a fall while going downstairs from his apartment, has been held to have arisen out of and in the course of his employment. Leslie v. O'Connor & Richman (1917) 220 N. Y. 672, 116 N. E. 1057, affirming (1916) 173 App. Div. 988, 158 N. Y. Supp. 1120. This is a memorandum decision, but it is stated by Kellogg, P. J., in Murphy v. Ludlum Steel Co. (N. Y.) infra, that the record shows that the manager at first received his wages and paid for the apartment, but later he was not charged for it. A finding has also been held warranted in favor of a caretaker of club grounds and buildings who was injured in trying to put out a fire which started from his burning some dry grass. Dietz Club v. Niehaus (1923) Neb., 193 N. W. 344. And in Prevost v. Gheens Realty Co. (1922) 151 La. 508, 92 So. 38, compensation was awarded (under the Employers' Liability Act, which appears to correspond with the Workmen's Compensation Acts) for an injury to a laborer at a sugar factory who had been working until nearly midnight, and was on his way to a bunk house on the premises, where the men were permitted to sleep, he having apparently fallen on or near a railroad track. In upholding a common-law finding of damages for the death of a janitor of an office building by being struck by an electric wire that fell in front of the tenement house where he lived, and which belonged to the company that owned also the office building and plant, the janitor having just started for work in the morning, carrying a basket of laundry to the restaurant in the office building for his wife, who conducted the restaurant for the same company, the court held that the case did not come within the provision of the act, inasmuch as the janitor was not acting in the course of his employment at the time of the accident, nor was he upon the employer's premises nor at the plant, the buildings constituting the plant being about 800 feet from the house. In a well-reasoned dissenting opinion it was argued (by Kellogg, P. J.) that this was a case for compensation under the act, inasmuch as the husband and wife had been hired together and the company expected them to assist each other, and housed them as part of the contract. He also believed that the wire was essentially a part of the plant, but intimated that an injury to the janitor after hours from the fall of a chimney on the house would probably not arise out of or be in the course of his employment. Murphy v. Ludlum Steel Co. (1918) 182 App. Div. 139, 169 N. Y. Supp. 781, affirmed in (1919) 227 N. Y. 634, 126 N. E. 915. In Briskin v. Hyman (1922) 203 App. Div. 275, 197 N. Y. Supp. 111, affirmed in (1923) 236 N. Y. 522, 142 N. E. 268, compensation was denied for the death of an acting manager of a garage from a fire at the garage on a night when he was staying there, as he had been in the habit of doing at times for his own convenience mostly, but was not required to do. An injury to a club porter from trying to climb into an open window at about midnight, upon returning after a day off and finding the clubhouse closed, has been held to be without the scope of his employment, and the porter also was apparently guilty of "serious and wilful misconduct," the court holding, that, "during the time of his absence from the club premises for purposes of his own, the risk of an accident was his risk, and not that of the employer, and not until he had reached the inside of the premises, where his duties lay, was such a risk transferred from his shoulders to those of the employer." Watson v. Sherwood (1909) 127 L. T. Jo. (Eng.) 86, 2 B. W. C. C. 462. Asphyxiation of a steel worker while asleep in his bed in a cottage which he was allowed by his employer to occupy in consideration of attending to cleaning of offices did not arise out of or in the course of his employment, where he was not obliged to live in the cottage. Wray v. Taylor Bros. & Co. [1913] W. C. & Ins. Rep. (Eng.) 446, 109 L. T. N. S. 120, 6 B. W. C. C. 529-C. A. In Butler v. Burton-on-Trent Union (1912) 106 L. T. N. S. (Eng.) 824, 5 B. W. C. C. 355-C. A., a fall of a workhouse master down some steps near his residence on the workhouse grounds, resulting from his becoming dizzy from coughing as he was sitting at the head of the steps, was held not to arise from his employment, there being "nothing peculiar to his employment which rendered the risk of this accident happening greater than that to which other people are exposed." A finding that a hospital porter who had been cleaning out a mortuary contracted scarlet fever from an "accident" arising out of and in the course of his employment has been held to be unwarranted in the absence of evidence that, at the time of his cleaning the mortuary, any body of a person who had died of scarlet fever was there, notwithstanding he had been in the fever wards the same day, the fact of "injury" being not of itself sufficient. Martin v. Manchester Corp. [1912] W. N. (Eng.) 105, 106 L. T. N. S. 741, 28 Times L. R. 344, 76 J. P. 251, 10 L. G. R. 996, [1912] W. C. Rep. 289, 5 B. W. C. C. 259—C. A. E. W. H. Banks FEDERAL RESERVE BANK OF RICHMOND, Plff. in Err., V. D. J. MALLOY et al., Trading as Malloy Brothers. United States Supreme Court - February 18, 1924. (264 U. S. 160, 68 L. ed., Adv. Ops. p. 288, 44 Sup. Ct. Rep. 296.) effect of regulation relieving from liability. 1. The regulation of the Federal reserve banks, that they assume no liability in collections except for negligence, does not authorize them to accept drafts in payment of checks sent them for collection. [See note on this question beginning on page 1269.] -liability of collecting bank to depositor. 2. Where, by statute, a bank in which a check is deposited for collection becomes liable only after payment is received, banks to which the check is sent in course of collection become agents of the depositor, against which he may maintain suit in case of their negligence. -duty of collecting agent. 3. A collecting agent is without authority to accept for the debt of his principal anything but that which the law declares to be legal tender, or which is, by common consent, considered and treated as money, and passes as such at par. [See 3 R. C. L. 616; 1 R. C. L. Supp. 864; 4 R. C. L. Supp. 208.] liability for accepting worthless draft. 4. A bank to which a check is sent for collection becomes personally liable in case it accepts as payment a draft which proves to be worthless. [See 3 R. C. L. 617; 1 R. C. L. Supp. 864; 4 R. C. L. Supp. 208. See also note in 19 A.L.R. 589.] Checks drawer. release of liability of 5. The acceptance by a bank having a check for collection, of a draft in payment, releases the liability of the drawer. [See 3 R. C. L. 641; 1 R. C. L. Supp. 870.] Banks effect of right to send checks to drawee. 6. The regulation of the Federal reserve banks, permitting them to send checks for collection directly to the drawee, does not include authority to accept drafts in payment. ERROR to the United States Circuit Court of Appeals, Fourth Circuit, to review a judgment affirming a judgment of the District Court for the Eastern District of North Carolina in favor of plaintiffs in an action brought to recover the amount of a check alleged to have been lost through defendant's negligence. Affirmed. The facts are stated in the opinion of the court. error: There was no privity of contract between the parties. Taylor & B. Co. v. National Bank, 262 Fed. 168; Balcomb v. Old Nat. Bank, 120 C. C. A. 27, 201 Fed. 679; First Nat. Bank v. Federal Reserve Bank, 283 Fed. 700; Hoover v. Wise, 91 U. S. 308, 23 L. ed. 392; Exchange Nat. Bank v. Third Nat. Bank, 112 U. S. 276, 28 L. ed. 722, 5 Sup. Ct. Rep. 141; American Bank & T. Co. v. Federal Reserve Bank, 256 U. S. 350, 65 L. ed. 983, 25 A.L.R. 971, 41 Sup. Ct. Rep. 499; Cohen v. Tradesmen's Nat. Bank, 262 Pa. 76, 4 A.L.R. 518, 105 Atl. 43; Montgomery County Bank v. Albany City Bank, 7 N. Y. 459. There is an irreconcilable conflict in the decisions of the various state courts upon the question of the nature of the responsibility which should be inferred or implied from the mere act (264 U. S. 160, 68 L. ed. —, Adv. Ops. p. 288, 44 Sup. Ct. Rep. 296.) of accepting a check for collection when there is no express contract setting forth the liability of the collecting bank. Exchange Nat. Bank v. Third Nat. Bank, 112 U. S. 276, 28 L. ed. 722, 5 Sup. Ct. Rep. 141; Bank of Washington v. Triplett, 1 Pet. 25, 7 L. ed. 37; 3 R. C. L. 623, §§ 251, 252. In those jurisdictions in which the courts adhere to the so-called Massachusetts rule, there is some diversity of opinion as to whether or not the drawee is a proper subagent. The majority of courts hold that it is never proper to select the drawee as a subagent, for the drawee always has an interest adverse to the holder of the check. Bank of Rocky Mount v. Floyd, 142 N. C. 187, 55 S. E. 95; 3 R. C. L. 627. Some courts, however, recognize that under modern conditions the risks incident to the method of collecting a check by sending it to the drawee for remittance were no greater than those incident to the employment of some independent agent in the same place. Hilsinger v. Trickett, 86 Ohio St. 286, 99 N. E. 305, Ann. Cas. 1913D, 421; Kershaw v. Ladd, 34 Or. 375, 44 L.R.A. 236, 56 Pac. 402; Wilson v. Carlinville Nat. Bank, 187 Ill. 222, 52 L.R.A. 632, 58 N. E. 250. Authority to send checks directly to the drawee implies authority to accept exchange drafts from drawee. First Nat. Bank v. Davis, 114 N. C. 343, 41 Am. St. Rep. 795, 19 S. E. 280; First Nat. Bank v. Wilmington & W. R. Co. 23 C. C. A. 200, 42 U. S. App. 232, 77 Fed. 401; Farmers' Bank & T. Co. v. Newland, 97 Ky: 464, 31 S. W. 38; American Bank & T. Co. v. Federal Reserve Bank, 262 U. S. 643, 67 L. ed. 1153, 43 Sup. Ct. Rep. 649; Brookings State Bank v. Federal Reserve Bank, 277 Fed. 430, 281 Fed. 222. The acceptance of the exchange draft was not a direct cause of loss. American Nat. Bank v. Miller, 229 U. S. 517, 57 L. ed. 1310, 33 Sup. Ct. Rep. 883; Bank of Rocky Mount v. Floyd, supra. Mr. Robert H. Dye, for defendants in error: The Federal Reserve Bank of Richmond was the agent of Malloy Brothers. Exchange Nat. Bank v. Third Nat. Bank, 112 U. S. 276, 28 L. ed. 722, 5 Sup. Ct. Rep. 141; Brown v. People's Bank, 52 L.R.A. (N.S.) 634, note; Wilson v. Smith, 3 How. 763, 11 L. ed. 820; Miller v. Farmers' & M. Bank, 30 Md. 392; Farmers' Bank v. Owen, 5 Cranch, C. C. 504, Fed. Cas. No. 4,662; Bank of Lindsborg v. Ober, 31 Kan. 599, 3 Pac. 324; City Nat. Bank v. Cooper, 91 S. C. 91, 74 S. E. 366; Bank of Washington v. Triplett, 1 Pet. 25, 7 L. ed. 37; Elliott, Contr. §§ 2831, 2832; Mechem, Agency, § 1; State v. Hubbard, 58 Kan. 797, 39 L.R.A. 860, 51 Pac. 290; Sternaman v. Metropolitan L. Ins. Co. 170 N. Y. 13, 57 L.R.A. 319, 88 Am. St. Rep. 625, 62 N. E. 763; Planters' & F. Nat. Bank v. First Nat. Bank, 75 N. C. 534; Bank of Rocky Mount v. Floyd, 142 N. C. 187, 55 S. E. 95. The Federal Reserve Bank of Richmond was negligent in sending the check direct to the Bank of Lumber Bridge, notwithstanding the regulations of the Federal Reserve Board. Brady. Bank Checks, § 229; People v. St. Nicholas Bank, 77 Hun, 159, 28 N. Y. Supp. 407; National Union Bank v. Earle, 93 Fed. 330; Merchants' Nat. Bank v. National Bank, 139 Mass. 513, 2 N. E. 89; Overman v. Hoboken City Bank, 30 N. J. L. 61; Louisiana Ice Co. v. State Nat. Bank, McGloin (La.) 181; Dorchester v. Merchants Nat. Bank, 106 Tex. 201, 50 L.R.A.(N.S.) 542, 163 S. W. 5, 7 N. C. C. A. 388; Winchester Mill. Co. v. Bank of Winchester, 120 Tenn. 225, 18 L.R.A. (N.S.) 441, 111 S. W. 248; 3 R. C. L. "Banks," §§ 255-258, pp. 627-630; Anderson v. Rodgers. 27 L.R.A. 249, and note, 53 Kan. 542, 36 Pac. 1067. Plaintiff in error had no right to accept the exchange draft, as collecting agent for defendants in error. Ward v. Smith, 7 Wall. 447, 19 L. ed. 207; Brown v. People's Bank, 52 L.R.A. (N.S.) 652, note; Elliott, Contr. § 1767; 3 R. C. L. "Banks," § 245, p. 616; Pinkney v. Kanawha Valley Bank, 68 W. Va. 254, 32 L.R.A. (N.S.) 987, 69 S. E. 1012, Ann. Cas. 1912B, 115; Bank of Rocky Mount v. Floyd, supra; Bank of Antigo v. Union Trust Co. 149 Ill. 343, 23 L.R.A. 611, 36 N. E. 1029; Winchester Mill. Co. v. Bank of Winchester, 120 Tenn. 225, 18 L.R.A. (N.S.) 441, 111 S. W. 248; Kirkham v. Bank of America, 165 N. Y. 132, 80 Am. St. Rep. 714, 58 N. E. 753; 6 R. C. L. 164; Rogers v. Tiedeman, 9 Ga. App. 811, 72 S. E. 285; Goldsborough v. Turner, 67 N. C. 410; Moye v. Cogdell, 69 N. C. 95; Farmers & M. Bank v. Federal Reserve Bank, 262 U. S. 649, 67 L. ed. 1157, 30 A.L.R. 635, 43 Sup. Ct. Rep. 651; Baldwin State Bank v. National Bank, 144 Ga. 181, 86 S. E. 538; Miller v. Norton, 114 Va. 609, 77 S. E. 452. Mr. Justice Sutherland delivered the opinion of the court: Malloy Brothers brought this action against the Federal Reserve Bank of Richmond in a state court, to recover $9,000, alleged to be the amount of a check drawn to their order upon the Bank of Lumber Bridge, North Carolina. The case was removed to the Federal district court for the eastern district of North Carolina, where it was tried without a jury and judgment rendered for plaintiffs (281 Fed. 997), which was affirmed by the court of appeals (291 Fed. 763). The check was drawn on November 30, 1920, delivered to and received by plaintiffs, and the amount credited to the drawer. It was properly indorsed and deposited with the Perry Banking Company of Perry, Florida, for collection and credit, on December 1. A credit card was delivered to plaintiffs, upon which was printed: "Checks, drafts, etc., received for collection or deposit, are taken at the risk of the indorser until actual payment is received." A statute of Florida, then and ever since in force (Laws of Florida 1909, chap. 5951, p. 146), provides as follows: "That when a check, draft, or other negotiable instrument is deposited in a bank for credit, or for collection, it shall be considered due diligence on the part of the bank in the collection of any check, draft, note or other negotiable instrument so deposited, to forward en route the same without delay in the usual commercial way in use according to the regular course of business of banks, and that the maker, indorser guarantor, or surety of any check, draft, note or other negotiable instrument, so deposited, shall be liable to the bank until actual final payment is received, and that when a bank receives for collection any check, draft, note, or other negotiable instrument, and forwards the same for collection, as herein proIvided, it shall only be liable after actual final payment is received by it, except in case of want of due diligence on its part, as aforesaid." The Perry Banking Company indorsed and transmitted the check to a bank at Jacksonville, Florida, which, in turn, indorsed and transmitted it, on account of the Atlanta Federal Reserve Bank, to a bank at Atlanta, Georgia; and by the latter bank it was transmitted for collection to the Richmond bank, defendant herein. On December 10, 1920, the Richmond bank transmitted the check, together with several other small checks, to the Lumber Bridge bank for collection and return. The letter containing these checks, by regular course of mail, should have been received, and, so far as appears, was received, by the Lumber Bridge bank, on Saturday, December 11th. On Tuesday, December 14th, the check in question was stamped "Paid," and charged to the account of the drawer, and on the same day the Lumber Bridge bank transmitted to the Richmond bank its draft on the Atlantic Banking & Trust Company, of Greensboro, North Carolina, for the aggregate amount of the checks, including the one here in question. The draft was received by the Richmond bank on December 15th, and immediately forwarded to the bank at Greensboro for payment. On December 17th the Greensboro bank notified the Richmond bank by wire that the Lumber Bridge bank did not have sufficient funds to its credit to pay the draft. Thereupon the Richmond bank wired the Lumber Bridge bank that its draft had been dishonored, and called upon it to make it good. The Lumber Bridge bank answered, promising to do so. It failed, however, and the Richmond bank thereupon sent a representative to Lumber Bridge, who reached there on the morning of December 20th, and demanded pay |