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should be so framed as not to render the right alienable. When the parties do not desire the aid of the court, it will not interfere at the suit of a creditor to change the condition of the property, and thereby give him rights which the will alone does not give him, and which the testator did not mean that he should have. In accordance with the opinion of a majority of the court, the entry is, demurrer sustained.
EXECUTION, WHAT NOT SUBJECT TO ATTACHMENT ONDER - As to whether trust property may be subjected to seizure and sale under execution, see McIlvaine v. Smith, 42 Mo. 45; 97 Am. Dec. 295, and particularly note 30+315. Compare Beck's Estate, 133 Pa St. 51; 19 Am. St. Rep. 623, and note,
FIRST NATIONAL BANK OF DANVERS V. FIRST
NATIONAL BANK OF SALEM.
[151 MASSACHUSETTS, 280.) Banks — FORORD CHECKS. — If a bank, in the ordinary course of its bugi.
ness, pays a check purporting to be signed by one of its depositors to one who, finding it in circulation or receiving it from the payee by indorsement, took
in good faith for value, the money cannot be recovered back on the discovery that the check is a forgery. It is presumed that the bank knows the signatures of its own customers, and therefore is not entitled to the benefit of the rule which, in cases of forgery, permits a party to recover back money paid under a mistake of fact as to the char.
acter of the instrument by which a fraud has been effected. BANKS — FORORD CHECK8. — If a bank pays a forged check to one who took
it under circumstances of suspicion, without proper precaution, or whose conduct has been such as to mislead the drawee, or induce him to pay the check without the usual security against fraud, it is entitled to re
cover of him the amount of such payment. BANK! – FORGED CHECKS - WHO MUST BEAR Loss Or PAYMENT OF.
Where a loss which must be borne by one of two parties aliko inno cent of a forgery can be traced to the neglect or fault of either, it is reasonable that it should be borne by him, even though innocent of any intentional fraud, through whose means it has succeeded. To entitle the holder to retain money obtained by a forgery, he should be able to maintain that the whole responsibility of determining the validity of the signature was placed upon the drawee, and that the vigilance of the drawee was not lessened, and that he was not lulled into false security by any disregard of duty on his own part, or by the failure of any precaution which, from his implied assertion in presenting the check as a parporting to be drawn by one of its customers, is a forgery, it may recover the amount thereof of the bank which had so transmitted it and received credit therefor. The bank on which the check parported to be drawn had a right to believe that the bank which cashed it had, before doing so, made the usual and proper investigation regarding its validity. The negligence of the bank on which it was drawn in discovering tho forgery will not prevent its recovery, where such negligence has not prejudiced the bank negligently paying the check in the first instance.
sufficient voucher, the drawee had a right to believe that he had taken. BANKS — FORGED CHECKS. – If a bank negligently pays a forged check
without inquiry as to its genuineness, or of tho identity of the person presenting it, and then transmits it to the bank on which it was drawn, and is credited with the amount thereof by the latter, which retains the obook for a couple of months, when it ascertains that the abook, though
ACTION to recover money paid upon a forged check. About September 25, 1884, a check, purporting to be drawn by E. A. Mudge & Co., in favor of Joel Kimball or bearer, upon the First National Bank of Danvers, was presented to the First National Bank of Salem by a person not known to the latter bank, and without any inquiry as to the identity of the party presenting the check, and upon his signing upon the back thereof the name “Joel Kimball,” the amount thereof was paid to bim. The bank of Salem transmitted the check to the National Bank of Redemption for collection. On September 26, 1885, the check was received by the bank of Danvers, and by it charged to E. A. Mudge & Co., and credited to the National Bank of Redemption. Both the check and the indorsement upon it were forgeries. About two months after the check had been charged to E. A. Mudge & Co., it was shown to them for the first time, and pronounced a forgery. The failure to sooner discover the forgeries was due to the fact that the account of Mudge & Co. was not an active one, and no check had been drawn upon it later than July, 1885. The indorsement of the name of Joel Kimball on the back of the check and that name as written in the body thereof were apparently in the same handwriting. This action was by the bank of Danvers against the bank of Salem to recover the amount of the check. Judgment for plaintiff.
G. B. Ives, for the defendant.
DEVENS, J. In the case at bar the plaintiff seeks to recover from the defendant the amount of a forged check in the name of one of the plaintiff's customers, for which it had given the defendant credit as money.
In the usual course of business, if a check purporting to be signed by one of its depositors is paid by a bank to one who, finding it in circulation or receiving it from the payee by indorsement, took it in good faith for value, the money cannot be recovered back on the discovery that the check is a forgery. It is presumed that the bank knows the signature of its own customers, and therefore is not entitled to the benefit of the rule which in cases of forgery permits a party to recover back money paid under a mistake of fact as to the character of the instrument by which the fraud has been effected. This presumption is conclusive only when the party receiving the money has in no way contributed to the success of the fraud, or the mistake of fact under which the payment has been made. In the absence of actual fault on the part of the drawee, his constructive fault in not knowing the signature of the drawer and detecting the forgery will not preclude his recovery from one who took the check under circumstances of suspicion without proper precaution, or whose conduct has been such as to mislead the drawee or induce him to pay
the check without the usual security against fraud: Nat. Bank of North America v. Bangs, 106 Mass. 441, 445; 8 Am. Rep. 349. Where a loss which must be borne by one of two parties alike innocent of the forgery can be traced to the neglect or fault of either, it is reasonable that it should be borne by him, even if innocent of any intentional fraud, through whose means it has succeeded: Gloucester Bank v. Salem Bank, 17 Mass. 33. To entitle the holder to retain noney obtained by a forgery, he should be able to maintain that the whole responsibility of determining the validity of the signature was placed upon the drawee, and that the vigilance of the drawee was not lessened and that he was not lulled into a false security by any disregard of duty on his own part, or by the failure of any precautions which from his implied assertion in presenting the check as a sufficient voucher the drawee had a right to believe he had taken: Ellis v. Ohio Ins. and Trust Co., 4 Ohio St. 628; Rouvant v. San Antonio Nat. Bank, 63 Tex. 610; First Nat. Bank of Quincy v. Ricker, 71 IIL. 439; 22 Am. Rep. 104.
In the case at bar it is found that the defendant was guilty of negligence in cashing the check without more inquiry as to its genuineness, and this finding is fully supported by the facts. The person who presented the check to the defendant bank was not known to either of its officers, and was not one of its customers. No attempt to have him identified was made, and without identification the money was paid over upon his indorsement on the check of the name of “ Joel Kimball,” the check being payable to “Joel Kimball or bearer." nominal drawer of the check, whose name was forged, was not a customer of the defendant. It is altogether probable
that if the defendant, before it cashed the check, had made proper inquiry, the utterer of it would not have remained to encounter any such investigation, and if he had, it would readily have been ascertained that he was not the reputable person of the name of Joel Kimball who resided in Danvers. There was also evidence of the general custom of banks, in paying such checks, to have the person presenting them identified.
When this check was forwarded by the defendant for redemption, the plaintiff was without the means it would have had if it had been presented at its own counter of ascertaining the character of the person offering it. It had a right to believe that the defendant, in cashing a check purporting to be drawn by one not its own customer or entitled to draw upon it, had by the usual and proper investigation satisfied itself of its authenticity. The indorsement, which was not necessary to the transfer of the check, was a guaranty of the signature of the drawer, and the plaintiff had a right to believe that the indorser was known to the defendant by proper inquiry.
It is found that the plaintiff was negligent in not having more quickly ascertained that the check was a forgery, and in not having given notice to the defendant thereof. It is also found that in fact this negligence has not prejudiced the defendant. This negligence of the plaintiff apparently resulted from the circumstance that the account of its depositor was not what is termed an "active" account, by which we infer is intended one in which deposits and checks are frequent, and which is regularly settled at the end of each month. Even if the fact that the check when paid reduced the amount of the deposit below that which the depositor, as it was understood between him and the plaintiff, was to keep, or if any other circumstances should have called the attention of the plaintiff to the forgery, the original fault was still that of the defendant in paying the check without proper investigation. The plaintiff acted with entire promptitude when the forgery was discovered, and no negligence on its part has prejudiced the defendant. When the check was forwarded for redemption, it was entirely natural that the plaintiff should have been misled, and induced to allow the same in settlement without the scrutiny it would have exercised had not the defendant given currency thereto.
The defendant deems that the case of Bank of St. Albans v. Farmers' and Mechanics' Bank, 10 Vt. 141, 33 Am. Dec. 188, resembles the case at bar in every respect, and if it is to be followed, is decisive. We do not so consider it. While in that case there was a delay on the part of the plaintiff in notifying the defendant that the check received from it was forged, the question whether there had not been negligence on the part of the defendant in originally taking the check without proper inquiry, and thus of contributing to the error into which the plaintiff fell in giving the defendant credit therefor, was not raised nor discussed. The only question of that nature there considered was, whether it was the duty of the defendant to have communicated suspicions which occurred to it after the transaction. An interpretation such as the defendant gives to this case would make it conflict with the decision in Nat. Bank of North America v. Bangs, 106 Mass. 441, 8 Am. Rep. 349, in which it is cited and considered. That decision strongly sustains the result which we have reached in the case at bar.
BANKS AND BANKING – FORGED CHECK. - As to the rights and remedies of the several parties when a forged check has been paid, see People's Bank v. Franklin Bank, 88 Tenn. 299; 17 Am. St. Rep. 884, and particularly extended poto 889-899.
LEWIS V. JEWELL.
(151 MASSACHUSETTS, 846.) SALE – FRAUD OF VENDOR IN MISREPRESENTING QUANTITY. - If the owner
of carpets covering the floors of twelve rooms, besides the hall and stairs of a dwelling-house, knowingly and falsely represents, as of his own knowledge, that they contain a certain number of yards of material, to an intending purchaser, who, in reliance upon such representation, pur. chases the carpets, the vendee is liable for his misrepresentations. The purchaser was not bound to measure the carpets for himself, or to avail himself of other opportunities of ascertaining the quantity. ACTION of tort. The plaintiff's intestate wished to buy car pets owned by the defendant, and contained in a boardinghouse, where the plaintiff's intestate desired to use them. The defendant represented that there were about nine hundred yards; that there were within fifteen or twenty yards of that number. The purchase was made in reliance on this statement, and the carpets, being afterwards measured, were found to contain only 595 yards. The defendant asked the