Adler v. Broadway Bank

McAdam, J. Tenner & Mosler, who had money on deposit with the defendant, drew their hank check, whereby they directed the defendant to pay to the order of the plaintiffs the sum of $136.50. The check was delivered by the drawers to the plaintiffs’ collector in payment of a bill owing by the drawers to them. The collector forged the plaintiffs’ firm name on the back of the check as indorsers, and the defendant paid the money to the collector and charged the amount against the drawers’ account. The collector appropriated the money to his own use. The drawers have assigned whatever right of action they have against the defendant to the plaintiffs, who now represent both the drawers and the lawful owners of the check. The collector had no authority to indorse the plaintiffs’ name as indorsers on the check, and the payment to him is no defense to the defendant. Robinson v. Chemical Nat. Bank, 86 N. Y. 404; Schmidt v. Garfield Nat. Bank, 64. Hun, 298; affd., 138 N. Y. 631; People v. Bank of North America, 75 id. 548; Morgan v. Bank of State, 11 id. 404; Welsh v. German-Am. Bank, 73 id. 424; Bank of British North America v. Mer. Nat. Bank, 91 id. 106; Shipman v. Bank of State, 126 id. 318. The circumstance that on a previous occasion, when the collector presented a check to the defendant bearing the. forged - indorsement of the plaintiffs, the drawers of the check introduced the collector as a person authorized to receive the money on that check, does not furnish any defense here. The payment of the prior check was no doubt a valid one against the drawers thereof, as by their authority, on the principle of equitable estoppel. But this does not so operate as to the check in suit, which was given subsequently. There is no evidence that the drawers of the prior check knew that the indorsement thereon had been forged, nor has it even been suggested that the drawers were in complicity with the forger; and the mere circumstance that the drawers had by their conduct estopped themselves as to that particular check, does not imply that they were" to be similarly estopped as to subsequent checks respecting which they assumed no such responsibility. It follows that the plaintiffs are entitled to judgment. Judgment for plaintiffs.