Walker v. Bank of New York

A draft drawn by the “Empire Mills,” a manufacturing corporation, addressed to “E. 0. Hamilton, Esq., New York,” and payable five months after date, was forwarded to the defendant for presentment to the drawer. The draft was presented to Hamilton, who thereupon wrote across its face as follows: Accepted, payable at American Exchange Bank. Empire Mills, by E. O. Hamilton, Treasurer. The defendant treated this as an acceptance by the drawee, and omitted to protest the bill, or to give any notice to the drawer or indorser. Held, that the defendant was not justified in considering or treating what was written by Hamilton as an acceptance by him of the draft; that it purported to be an acceptance by the Empire Mills, and not by Hamilton himself; and that, although the Empire Mills was not bound by the acceptance, it did not follow that Hamil [258] ton was personally bound; the rule which holds an agent to be bound by the terms of the contract, where he fails to bind his principal, being confined to cases where such failure arises from a want of authority, in fact, to make the contract, which want of authority is not to be presumed; and that, even if want of authority were assumed and proved, the defendant had no right to impose upon the plaintiff the necessity of litigating that question, or to receive anything short of an unequivocal personal acceptance. Held, therefore, that the defendant was guilty of negligence in not causing the draft to be protested, or giving any notice of its dishonor, and was liable to the plaintiff for its amount, both drawer and indorsers having become insolvent. (S. C., 13 Barb. 636; 9 N. Y. 582.)