to the payment of the check, although the indebtedness still remained undischarged and unsecured. But if at the time when the holder hands in the check he demands to have it placed to his credit, and is informed that it shall be done, or if he holds any other species of conversation which practically amounts to demanding and receiving the promise of a transfer of cred as equivalent to an actual payment, the effect will be the same as if he had received his money in cash, and the bank's indebtedness to him for the amount will be equally fixed and irrevocable.2 Money given to Drawer of Worthless Check. Where money is paid to a person in exchange for his own check, which is worthless, and is known to him at the time of the transaction to be worthless, the title to the money nevertheless passes to him. This rule was laid down in bankruptcy proceedings; the person who gave the check upon his bankers (who had for some time refused to honor his checks) went into bankruptcy, and the party to whom he gave it, and who gave him cash for it, filed a petition for reimbursement in full, on the ground that the title to the money did not pass. But the court held that the title did pass in spite of the known worthlessness of the check, that the money was part of the general assets of the bankrupt, and that the check-holder could only come in as an ordinary creditor and take his dividend.3 Check as Testamentary Instrument. A check may, under proper circumstances, be admitted to probate as a testamentary document.* 1 Boyd v. Emmerson, supra. 2 Ibid. (per Lord Denman, C. J.). 3 In re King, 8 Nat. Bkcy. Reg. (Georgia) 285. 4 Walsh v. Gladstone, 1 Phil. Ch. C. 294; Bartholomew v. Henley, 3 Phil. 317; Heming v. Clutterbuck, 1 Bligh, N. s. 479; Brine v. Ferrier, 7 Sim. 549; Gladstone v. Tempest, 2 Curt. 650; Jones v. Nicholay, 2 Robt. 288; In the Goods of Marsden, 1 Sw. & Tr. 542. Check as Subject of Donatio Mortis Causa. Grant lays it down that a check may be the subject of a good donatio mortis causa.1 But in Williams on Executors the contrary doctrine is asserted; the author remarking that a check "is an order for the payment of money, that may take effect immediately, and in the lifetime of the donor; so that it is (generally speaking) altogether inconsistent with the nature of a donation mortis causa." 2 But where the testator in his last illness drew a bill on his goldsmith in favor of A., and delivered it to her with directions indorsed upon it to buy her mourning, it was held a good donatio mortis causa.3 So where a testator, remarking to his wife that he was. dying, and that she would want money before his affairs could be settled, gave her a crossed check, and afterward procured a friend to take this and give to the wife his own [the friend's] check in exchange therefor, and the testator's check was paid before his death and the friend's check after the death, it was held that the testator's check was good as a donatio mortis causa; but, at the same time, it was declared that a check not presented before the drawer's death was not a good donatio mortis causa.4 Where the check was presented before the donor's death, and was not then paid only because the bankers were in doubt 1 Grant on Bankers and Banking (3d ed.), p. 107, citing Boutts v. Ellis, 4 De G. M. & G. 249; 17 Jur. 405 (585); Tate v. Hilbert, 4 Bro. C. C. 286; Ves. Jr. 111; Reddell v. Dobsee, 3 Jur. 722; 10 Sim. 244; Hewitt v. Kaye, 37 L. J. Ch. 633. 2 Williams on the Law of Executors and Administrators, p. 779, citing Tate v. Hilbert, 2 Ves. Jr. 111, at p. 120; s. c. 4 Bro. C. C. 286; Tate v. Leithead, Kay, 650; Hewitt v. Kaye, 6 L. R. Eq. 198; In re Beaks' Estate, 13 id. 734 (where the pass book was also given to the payee, but the check was not presented till after the drawer's death); Second National Bank v. Williams, 13 Mich. 282; Harris v. Clark, 3 N. Y. 93; Contant v. Schuyler, 1 Paige, 316; Shirley v. Whitehead, 1 Ired. Eq. 180; Mandevile v. Welch, 5 Wheat. 277 (286); Tiernan v. Jackson, 5 Pet. 580. 3 Lawson v. Lawson, 1 P. Wms. 441. 4 Boutts v. Ellis, 17 Beav. 121; s. c. affirmed on appeal, 4 De G. M. & G. 249. as to the genuineness of the signature, and on the day following the drawer died, the payee was held to be entitled, on the ground that there had been a complete gift of the amount of the check inter vivos. It would seem that this ruling contains the most satisfactory theory of the law in this matter. If the delivery of the check be a mere naked gift, it is revocable at any time before payment, and if the death of the drawer occurs before payment revocation contemporaneously occurs. But if the money be actually obtained before the death of the donor, then the gift is completed. The gift of the check is only the gift of a promise. A somewhat different case is where the donor gave to the donee an instrument whereby the banker acknowledged that he held a certain sum belonging to the donor at the donor's disposal. This gift was upheld as a good donatio mortis causa.2 Here, however, we have the peculiar state of facts of the banker's acknowledgment, followed by the actual disposition of the fund. It resembles an assignment, such that at once upon its completion the banker held the money for the assignee or donee, and no longer for the donor,- quite a different condition of affairs from that resulting from the delivering of a check. A testator, upon his death-bed, drew a check to the order of his wife, and gave it to her. Before his death she indorsed it and deposited it with bankers in a foreign country, and subsequently she drew sundry checks upon these bankers against this deposit, which checks appear to have been duly honored. The bankers on whom the check was drawn refused payment when the check was presented after the decease of the drawer, on the ground that after the death their authority to pay was at an end. The question was then presented whether or not the check was a good donatio mortis causa. Vice-Chancellor Malins remarked that the law seemed to be in a curious state, since it permitted a bill of exchange, in its nature not payable till a future day, to be a good subject of donatio, but denied this privilege to a check unless it should be presented for pay 1 Bromley v. Brunton, 6 L. R. Eq. 275. 2 Amis v. Witt, 33 Beav. 619; Grymes v. Howe, 49 N. Y. 17; Meach v. Meach, 24 Vt. 591; Harris v. Clark, 3 N. Y. 111. ment before the drawer's death. He then sought to confine the rule as regards checks to such only as are payable to bearer, admitting that these must fall within the foregoing doctrine. The check in question was payable to order, and it was clear that the testator knew that it could not be presented for payment either on the day when it was drawn or on the next following day. "I must attribute to him the knowledge that the check would not be paid for some time, and on that ground I come to the conclusion that this case differs from the other cases of checks. . . . I think that when a man gives his wife a check, it is in substance as complete a gift as if he handed her the cash." The Vice-Chancellor regarded Tate v. Hilbert as an authority directly supporting him, and preferred, "if there is any real discrepancy," to accept as correct the report of that case given in 2 Ves. 111, rather than the report contained in 2 Bro. C. C. 291. This case he interpreted as intending to hold" that an actual dealing for value with a note would complete the gift as a valid donatio mortis causa." 1 1 Rolls v. Pearce, 5 Ch. D. 730. CHAPTER VI. COLLECTION. The Undertaking generally. COLLECTION upon checks, notes, drafts, bills of exchange, and in short upon every species of business paper, is a duty very commonly undertaken by banks on behalf of their customers. Collection upon checks is probably a universal necessity of the business. Specific power to assume this duty is not usually conferred in the charter of a banking corporation. It is not necessary that it should be so, since the courts regard it as a part of the banking business. After the collection has been made the bank becomes a simple contract debtor for the amount, less the commission, if any has been charged. If the party for whom the collection is made is a regular depositor, the sum will be properly placed to his credit upon his general deposit account,2 unless a peculiar usage or special instructions demand some different course of dealing. If the party has no deposit account the bank simply owes him the amount on demand. But it would seem that, if it chooses, the bank may credit him with it as if it were an ordinary payment on deposit, and thus initiate and establish the relation of banker and depositor between itself and him. For though this may operate to place the bank under obligations and duties towards him which would not otherwise have existed, yet these are all for his advantage, and his own right to withdraw the whole sum instantly upon demand is in no respect altered, if he does not wish to ratify the option of the bank and to become an ordinary depositor.3 1 Tyson v. State Bank, 6 Blackf. 225. 3 Tinkham v. Hayworth, 31 Ill. 519. |