First National Bank v. Higbee & Co.

Mr. Justice Paxson delivered the opinion of the court, [132] This case is free from difficulty. Of the numerous assignments of error we select the seventh as the only one which requires discussion. It raises the pivotal question in the cause. The defendant’s seventh point called upon the court to instruct the jury: “That even if John B. Gillespie had personally deposited the money, and received the deposit ticket in evidence, yet he would have had a right to revoke his direction to pay the Higbee draft at any time before the same was paid by the bank.” The learned court declined to affirm this point. To understand the question which this ruling presents, it is necessary to give a brief summary of the facts. Higbee & Co., the plaintiffs below, had drawn their draft on John B. Gillespie for $797.76, at thirty days. The draft was accepted by Gillespie, but was not paid at maturity, and was returned to the bank in Philadelphia, from which it had been received. Subsequently John B. Gillespie sent his brother, Thomas Gillespie, to the First National Bank of Scranton with six hundred dollars to apply on this draft. Being informed by the cashier that the draft had been returned to the bank from which it had been received, Thomas Gillespie left the money with the cashier, and received from that officer a certificate of deposit in favor of John B. Gillespie for $600 “to pay Higbee draft.” This certificate was given by the brother to John B. Gillespie, who kept it for seven days, when he drew his cheek upon the bank for six hundred dollars; sent it with the certificate of deposit to the bank and drew out the money. The draft in the meantime had not been returned to the bank. Subsequently Higbee & Co. brought suit against the bank for the $600 and recovered a verdict. It heeds neither argument nor authority to show that the money deposited was the money of J. B. Gillespie, and as such under his control. It is true his brother had deposited it to meet the Higbee draft, but assuming, as the point does, that the money had been so deposited by J. B. Gillespie himself, or by his authority, he had the power to revoke such direction. The money had not been applied to the draft by the bank when Gillespie’s check was presented, and could not have been as the draft was not there. Had' the bank failed between the date when the money was deposited and when it was drawn out upon Gillespie’s check, the loss would have fallen on him, not on Higbee & Co. The latter had no interest in the money until its application to their draft. An order or direction on the part of Gillespie to so apply it was in its nature revocable up to the moment of its application. Had it been so applied the power of revocation would have ceased to exist. The deposit of the money to pay the draft was not an equit [133] able assignment of the fund. Had it been deposited to the credit of Higbee & Co. to meet the draft the case would have been different. But it was not, nor could it well have been without risk to Gillespie, as the draft might have been discounted and held by other parties. The money was deposited to the credit of Giliespie, and the bank could not have refused to pay it out on his check. It could not have paid it to Higbee & Co. because it had no such order; it had no knowledge even that they ever owned the draft; the draft itself was not there, and there could therefore have been no application to its payment. There was, at most, a direction to apply the money, which was a mere executory order and revocable: Morse on Banking, 304; Gibson v. Minet, 2 Bingham, 7; Geist’s Appeal, 41 Leg. Int., 500. We have discussed the case upon the theory that John B. Gillespie authorized the deposit in the manner above stated. The evidence is that he did not. He sent his brother to the bank with the $600 to apply on the draft. Thomas Gillespie had no instructions further ; certainly none to leave the money in the bank if the draft was not there; still less to pay it to the agent of Higbee & Co., or deposit it to their credit or for their benefit. We are of opinion that Higbee & Co. have no cause of action against the bank, and tlie judgment therefore must be reversed.