Allen v. Merchants Bank , 1 Lock. Rev. Cas. 46 ( 1799 )

The Supreme Court affirmed the decision of the Superior Court, holding that in the absence of any special agreement, or established usage, the Merchants Bank was not liable for the negligence of the bank or its notary in Philadelphia.

The Court of Errors held the contrary, and adopted the following resolution as their decision in the case.

“Resolved, that when a bank or broker or other money dealer, receives upon a good consideration, a note or bill for collection, in the place where such bank, broker, or dealer, carries on business, or at a distant place the party receiving the same for collection, is liable for the neglect, omission, or other misconduct of the bank or agent to whom the note or bill is sent, either in the negotiation, collection, or paying over the money, by which the money is lost, or other injury sustained by the owner of the note or bill, unless there be some agreement to the contrary, expressed or implied.”

Judgment reversed, by a vote of 14 to 10.

35? The reporter who seems dissatisfied with this decision, calls attention to the case of East Haddam Bank v. Scovil, 12 Conn. R 303, as concurring with the decision of the Supreme Court, and the opinion of the Chancellor, in this case. There, the acceptor was a bankrupt, and the judge left the question of default or negligence to the jury, and whether the- holder had been prevented from collecting or recovering the amount of the bill, by reason of any negligence or default on the part of the plaintiffs; and the jury found he had not.

In Allen v. Suydam, the court adopted the same rule of damages. 20 Wend. 321.

See Smith v. Bank of Orleans, 7 Hill, 595, note of reporter; and same case, 3 Hill, 561. “The case,” says the reporter, “ was' reversed but on points not appearing upon the bill of exceptions, but raised by the pleadings, so that the decision in 3 Hill, 561, has still the force of a precedent.”

In that case, Nelson Ch. J., says that “ the case of Allen v. Merchants Bank, proves only that the holder may resort to either, (the agent at home or abroad.) It has not yet been decided that the relation of principal and agent does not exist between the holder and the foreign agent; or that the .former may not resort'directly to the latter for negligence in charging the parties.”