Marine Bank & Trust Co. v. Triplett , 149 Miss. 274 ( 1928 )

^* Corpus Juris-Cyc. References: Banks and Banking, 7CJ, p. 608, n. 94, 2; p. 615, n. 65. As to rule affecting title to commercial paper deposited with bank for collection, see annotation in 11 A.L.R. 1046; 16 A.L.R. 1084; 42 A.L.R. 492; 3 R.C.L. 524; 1 R.C.L. Supp. 842; 4 R.C.L. Supp. 191; 6 R.C.L. Supp. 185. The appellant brought this action against appellee before a justice of the peace of Wilkinson county, on a check for the sum of one hundred dollars, drawn by the appellee on the Bank of Centerville in favor of Dr. R. Patrick, from whom appellant had purchased the check in due course. Judgment went in favor of the appellee, from which judgment appellant appealed to the circuit court of Wilkinson county, where there was a trial, resulting in a judgment in favor of appellee, from which judgment appellant prosecutes this appeal.

By agreement of the parties, the cause was tried before the circuit court sitting both as judge and jury. It was tried on agreed facts embodied in writing and made a part of the record, a copy of which, leaving off the formal parts, is as follows:

"It is agreed that the following facts are to control exclusively and without regard to pleadings or taking of testimony:

"It is agreed that on April 20, 1922, Frank P. Triplett of the Third supervisor's district, Wilkinson county, Miss., uttered, drew, made, and delivered to Dr. R. Patrick, a check, or order, on his (Triplett's) account in the Bank of Centerville, Wilkinson county, Miss., and against said account and payable therefrom in the sum and amount of one hundred dollars. It is further agreed that said check was for the purchase price of ten head of undelivered cattle, defendant not knowing the Bank of Centerville was insolvent, said cattle to be delivered on May 15, 1922. That on or about May 15, 1922, defendant called on Patrick to deliver the cattle, defendant offering to pay said check on the cattle being delivered to him, but that Patrick refused and failed to deliver the ten head of cattle unless Triplett would pay him the further stipulation of one hundred dollars, which defendant refused to do.

"It is further agreed that on April 24, 1922, said Dr. H. Patrick presented said check to the Marine Bank Trust Company, New Orleans, La., and said Marine Bank Trust Company paid in cash to said Dr. R. Patrick the sum of one hundred dollars and thereby received said check in due course and for value, and without notice or knowledge of any defenses, if any, existing between Dr. R. Patrick and Frank P. Triplett; that on April 24, 1922, the said Marine Bank Trust Company forwarded said check direct to the Bank of Centerville for collection; that at that time there was no other bank in said town of Centerville. That in due course of business said bank of Centerville received said check on or about the 26th day of April, 1922; that defendant had more than sufficient money on deposit in the Bank of Centerville on the 24th, 25th, 26th, 27th, 28th, and 29th of April, 1922, and on the 1st and 2d of May, 1922, and that said Bank of Centerville on all of said days had more than sufficient cash to pay said check, and all other of its current obligations; but that said Bank of Centerville failed to charge said check to the account of defendant and to remit same to plaintiff; that on May 9, 1922, said check was returned to the Marine Bank Trust Company by a bank examiner of the state of Mississippi with the information that the Bank of Centerville was in the hands of the state banking department and was closed to business and in process of liquidation; that said bank was closed on May 2, 1922, by said banking department.

"It is agreed that said Bank of Centerville has never taken any action on said check, and did not debit same against the account of Frank P. Triplett, or credit same against the account or to the Marine Bank Trust Company. That neither during the process of liquidation, nor since, or at any time, has said bank taken any action thereon.

"It is agreed that Frank P. Triplett never gave the Bank of Centerville a stop order against said check.

"It is further agreed that the Bank of Centerville has paid to its depositors payments, or settlements, up to this date of ____ per cent. of the full amounts of the respective deposits, and that Frank P. Triplett has duly received his ____ per cent. of the amount he had on deposit in said bank at the time it was taken over by the state banking department, and that the said check was never debited against his account in said bank, and that said ____ per cent. payments received by said Frank P. Triplett were inclusive of the amount covered by said check; that said bank or the state banking department will probably eventually pay each depositor the remaining ____ per cent. due on their respective deposits.

"It is agreed that judgment by consent was rendered against the Marine Bank Trust Company and in favor of Frank P. Triplett in the justice of the peace court of Hon. Theo. Rushing of the Third supervisor's district, Wilkinson county, Miss., the place of residence of Frank P. Triplett, and that an appeal was duly and legally made to the circuit court of Wilkinson county, Miss., by said Marine Bank Trust Company, and that jurisdiction is hereby conferred upon the circuit court for the full adjudication of the issues of this cause.

"It is agreed that the amount of this suit is for the face value of said check, to-wit, one hundred dollars and legal interest from date of April 24, 1922, to the date of final judgment, and legal interest until collected, and all costs."

The bank to which a check is sent for collection is the agent of the holder of the check for the purpose of making the collection, and the payment of such check absolves the drawer from further liability thereon. The bank on which the check is drawn is not the proper agent to which the check may be sent for collection. When a check is received for collection by the bank on which it is drawn, and the drawer then has sufficient funds on deposit with such bank with which to pay the check, the drawer will be discharged from further liability on the check although the bank fails to pay the amount of the check to the holder thereof from whom it was received, notwithstanding the bank may be then insolvent, provided it was then open for business and it does not appear that, in the event the check had been presented to it by another collection agent, it would not have been paid. Planters' Mercantile Co. v. Armour PackingCo., 109 Miss. 470, 69 So. 293.

The agreed facts in this case show that, when the Bank of Centerville received the check involved for collection, and for some days thereafter, it had on deposit to the credit of appellee, the drawer of the check, sufficient funds with which to pay the same. The Bank of Centerville, as the agent of appellant for the collection of the check, should have charged appellee's account with the amount of the check. The failure of the Bank of Centerville so to do was the cause of the check not being paid by the appellee. The Bank of Centerville was the agent of appellant for the collection of the check. The failure of the bank to perform its duty by charging the amount of the check to appellee's account is chargeable to its principal, the appellant. Therefore whatever loss there was must fall on appellant and not on appellee.

Affirmed.