D. A. Johnson & Co. v. Mechanics & Savings Bank

By the Court. Lumpkin, J. delivering the opinion. The Johnsons came to Columbus, with a letter of credit from Hardwick & Cook, of Savannah, to the agency of the Savannah Savings Bank, at Columbus, to furnish funds to [645] enable the Johnsons to buy cotton. On the 15th and 16th of December, 1856, the Johnsons borrowed $1,910 17, and it was understood that, according to their habit of doing business, they were to forward the eotton, which they bought with the money thus advanced, to Savannah, and draw on it at thirty days, to pay the bank. On the 17th of the month, the day after the last cash was drawn, both the bank and the Johnsons had notice of the failure of Hardwick & Cook. The bank immediately called upon the Johnsons to refund the money just loaned, or to give the bank the control of the cotton. They refused to do either; but offered to give a draft on Hardwick & Cook, at thirty days, without showing, or even pretending, that the cotton purchased with the plaintiff’s money, had been forwarded to Savannah. It does not appear that it ever was sent. The probability from the proof is, it never was. The plaintiff sued forthwith, to recover the cash advanced to the Johnsons. It cannot be seriously insisted, that the offer to give a draft tapen an insolvent house,.was payment of the defendants indebtedness. The bank never agreed to accept a draft as payment, or extinguishment of their demand. It was but a security, at best, for the original indebtedness. And they might decline taking it, if they considered it unavailable, which they did; and hold the parties bound upon their original liability. And then the defendant not having shown that they had forwarded the cotton to Hardwick & Cook, what means were provided for the payment of the draft, which they offered io give ? Suppose certain bank bills had been mentioned as the currency, in which this loan might be paid, and the bank had failed, and the defendant had then offered to procure thebills and discharge the debt? This attempt is equally as reasonable. For in this case, he still retained the cotton, the only resource for raising the funds, and yet it is gravely proposed [646] to settle with the creditor, who supplied the means to buy the cotton, by giving him a draft on an insolvent house! Judgment affirmed.