Citizens' Bank v. Grafflin , 1869 Md. LEXIS 129 ( 1869 )

Stewart, J.,

delivered the opinion of the Court.

Grafflin & Son, the plaintiffs below, held the draft of J. P. McQuillen on John Currier, Jr.,of Newburyport, Massachusetts, bearing date May 81st, 1867, and payable ninety days after date,, at the Shawmut Bank, Boston, to their order, which was endorsed by them, and discounted for them by the Citizens’ National Bank of Baltimore, the defendant below.

Before its maturity, it was presented for acceptance, and not being accepted was protested for non-acceptance.

When the draft matured it was protested for non-payment.

The bank informed the Grafflins, on the 4th of September, after the maturity of the draft, that it had not been paid, and requested them to make it good, which was done by a deposit of funds for that pui'pose. On the next day, the Bank sent down the draft with the protests, for nonacceptance and non-payment, and the Grafflins gave their check on the bank for the amount.

These advances of money were made by the Grafflins, as alleged by them, in utter ignorance that the draft, before its maturity, had been protested in July, for nonacceptance, of which fact they had not been informed.

So soon as they ascertained such had been the case, they promptly informed the bank that they had advanced the money, to make good the draft, in ignorance of the facts, and demanded the return of the money they had so paid. The bank refused to return the money.

This action was brought to recover back the money, paid under such circumstances, and the verdict and judgment being against the bank, it has brought up this appeal.

Exceptions were taken by both parties to the rulings of the Court.

The plaintiffs below excepted to the refusal of the Court to grant their first and second prayers, and to the Court’s instruction on the subject of usage. The defendant excepted to the refusal of the Court to grant its five prayers, and to the second instruction given by the Court.

The first prayer of the plaintiffs below was properly refused, because it asserted that the fact of the ignorance of the plaintiffs of the non-acceptance and protest of the draft in question, was sufficient to entitle them to recover.

Upon the non-acceptance and protest of the draft in July, when it was presented, before its maturity, if due notice of tbe fact had been placed in the post-office, addressed to them, such notice would have been sufficient.

Whether the plaintiffs actually received the same or not was immaterial, because the holder of the draft would have discharged its duty by giving notice in the manner aforesaid.

The second prayer of the plaintiffs was properly rejected.

Because the plaintiffs had been constant customers of the bank, which had discounted for them many like drafts, and immediately sent them on for acceptance, when the law did not require it, was no just reason to compel the bank, at the risk of being held liable for negligence, to pursue a similar course in the future.

The concession of such a favor, although repeated in sundry instances, ought not to be construed to operate as imposing upon the bank the imperative duty of its constant repetition, and as conferring upon the plaintiffs the absolute right to demand, and insist upon its’ continuance. However much the plaintiffs might be disappointed in their expectations upon the subject, the legal relations of the parties were not changed thereby.

If such transactions between parties could be interpreted as changing or modifying the well-established rules of law, the necessary effect of such a theory would be to make the business habits of the parties, however unreasonable or preposterous, the standard to govern their contracts, in the place of the provisions of the law.

Under such a state of things, questions might constantly arise as to the number of the repeated acts, between the parties, necessary and competent to establish usage sufficient to waive or suspend the uniform rules of law, otherwise applicable to their dealings.

Courts of justice, in place of expounding the law, would be continually occupied and perplexed in the ascertainment of the special law the parties had adopted to be applied to their transactions.

Is it not infinitely better that the law should be established and recognized as the guide, and have its uniform, application, and that parties in their diversified dealings should be regulated and governed by its wise and exact operation ?

The defendant’s first and third- prayers were properly rejected, because they asserted that no evidence had been given of the want of due notice to the plaintiffs of the protest of the draft for non-acceptance.

Evidence had gone to the jury, tending to show that notice of that fact had not been given to the .plaintiffs.

There is no cause of reversal as to the refusal of defendant’s second prayer, because it had substantially the benefit of the law claimed by that prayer, in the Court’s instruction to the jury.

The defendant’s fourth and fifth prayers were correctly refused.

If the jury were satisfied from the evidence that the plaintiffs paid the money to redeem the dishonored draft, under the circumstances described in the testimony, through inadvertence, mistake, or in ignorance of the facts in the case, but about which they might have better informed themselves by an inspection of the papers left with them by the defendant, still the plaintiffs are not to be held absolutely bound and concluded by such recognition of the claim.

If the error or mistake exists, or is shown to have occurred, or the plaintiffs paid the money believing the facts to be different from what they actually were, and they were in truth not bound to have paid the money, they are entitled to have the same refunded, if duly diligent in giving notice of the mistake. Whilst “ a party cannot recover money voluntarily paid, with a full knowledge of all the facts, although no obligation to make such payment exists, yet a payment cannot well be said to be made voluntarily when made in consequence alone of a false view of the facts. The assent is only induced by the conviction then prevailing in the mind, that the particular facts existed, and is scarcely to be distinguished from an assent or agreement to pay on the condition the facts did exist.”

Where the plaintiff’s right to have the error rectified is made out, the legal relations of the parties stand unaffected by anything done in ignorance of the facts. “ The subsequent discovery of the error destroys the whole basis of the agreement, and the parties are restored to their original condition and rights.”

If the jury were satisfied from the evidence- that the plaintiffs paid the money in question, in ignorance that the draft had been presented in July and was not accepted, and protested for non-acceptance, and if in fact no notice was duly given to them through the post-office or otherwise, they are entitled to recover it back. B. & S. R. R. Co. vs. Faunce & Passmore, 6 Gill, 68.

We concur with the ruling of the Court in its first instruction,- that there was no sufficient evidence of any usage prevailing with the banks in the city of Baltimore, or the Citizens’ National Bank, the defendant here, to justify the jury in inferring that such usage entered into and made part of the contract between the parties in relation to the draft in question.

To permit usage to govern and modify the law, in relation to the dealings of the parties, it must be uniform, certain, and sufficiently notorious to warrant the legal presumption that the parties made their contract with reference to the usage, and not according to the general and established law applicable to the case.

The evidence for such purpose should be very strong and conclusive to authorize the usage, to regulate and control the contract between the parties, in derogation of the established law.

The testimony advanced in this instance, however definite as to the character of - the usage in question, was not sufficient to show that it was a general and notorious usage, without which it could not furnish the criterion by which to determine and adjudicate the relative rights of the parties, in conflict with the general law upon the subject.

The Court’s second instruction, in that part of it where the language “ had no notice ” is employed, was calculated to mislead the jury.

If notice of the protest of the draft for non-acceptance was duly sent by. mail, although never received by the plaintiffs in point of fact, such notice was'all that was required to be given, on the part of the defendant, in discharge of the duty imposed upon it in relation to the draft.

But the jury, from the phraseology of the instruction and the use of the terms “ had no notice,” may have understood it as instructing them to find for the plaintiffs, if they believed from the evidence the plaintiffs had in fact received no notice, or had no actual knowledge of the non-acceptance of the draft and the protest thereof. •

(Decided 15th December, 1869.)

Under this view of its character and tendency, the instruction was erroneous, and we must reverse the ruling and send the case back for a new trial.

Judgment reversed and procedendo awarded.