Bellemire v. Bank of United States

The opinion of the Court whs delivered by Gibson, C. J. — It has been ruled by this Court, in conformity to precedents cited in The Mechanics’ Bank v. Earp, that a bank employed to transmit for collection, is bound to concern itself with the act of transmission alone; and that its correspondent becomes r the agent for subsequent measures. It is suggested, however, that a bank which has undertaken the whole business of collection, may be affected by other considerations; but though it be the holder by endorsement, there is nothing peculiar in its position. It is invested with the apparent ownership only to authorise it to present for payment; and standing, in all other respects on the ordinary footing of an agent, it is sufficient to exonerate it that it has acted in good faith and, though hot to the best advantage, according to the regular and accustomed course of the business. ■ Thus in Russel v. Hankey, (6 T. R. 12,) a banker who had given up bills endorsed to him for collection, on receiving the acceptor’s check which was subsequently dishonoured, was not charged with negligence because the transaction was not an unusual one. The principle was carried out in circumstances less like the present, in Smith v. Cadogan, (2 T. R. 188,) Pitt v. Yalden, (2 Burr. 2061,) and Moore v. Mourgue, (Cowp. 480.) Now a bank is compelled by the incorporeal nature of its essence, to act by the instrumentality of agents; and when it employs its own servant, with the usual instructions, it performs its implied promise to use ordinary diligence. I lay the servant’s official character out of the case. The bank was bound to commit the business to a competent hand; and it is not alleged that the notary . was not such. Had the plaintiff desired to have the services of a special agent, it would have béen his business to furnish one. Omitting to do'So, he consented to let the matter take its course; and the bank performed its duty by committing it to the person employed-in its own concerns. Nor do I agree that a bank is answerable for the act of an instrument, which is not a part of its organic machinéry, any more than a transmitting bank is answerable for the act of its correspondent. Though á hired agent is not only bound to a high degree of diligence in his own' person, but, as was held in Lord North’s case, (2 Dy. 161,) responsible as a- surety for those whom he chooses to employ; the agency in this instance; being purely gratuitous, is subject to a different rule. What the bank undertook to do, was to put the note into the ordinary channel of collection; and it performed its undertaking when, for the purposes of presentation and notice, it put it into the hands of its own notary. Nor does there seem to have been any default even in him. Though the [113] gratuitous acceptance of an agency is a consideration for an implied undertaking against misfeasance, it requires a valuable consideration to support an action for nonfeasance.. It appears, however, from Elsey v. Gatewood, (5 T. R. 148,) that an omission to finish a business gratuitously begun, is a positive misfeasance: still the responsibility of an unpaid, agent is so far inferior in degree, that he is not bound for ordinary skill, nor liable for any thing less than gross negligence. This is distinctly asserted in the Charitable Corporation v. Sutton, (2 Atk. 406,) and Coggs v. Bernard, (2 Ld. Raym. 909,) but more emphatically in Shiellsv. Blachburne, (1 H. B. 161,). where a merchant who had entered, for exportation, the goods of his correspondent together with his own, but both parcels by a wrong denomination, was not held ‘liable -for the seizure which ensued, because he had received no reward, and was not of a profession, as it was said, which implied the possession of peculiar skill. But it seems from the same case, that though actual mistake be' excusable, it will be treated as wilful where there has been a want of application of skill actually or presumptively possessed. Were the action against the notary, it might be said that as a hired servant, he was bound to use the utmost diligence; but even he would be excused if it appeared that, in the absence of'specific instructions, he had pursued the usual course. ' Though generally, if not universally employed on such-occasions, the official character of a notary extends only to the protest, and notto the hunting, up of the parties. Neither he, nor the bank, is bound to know any one in the transaction, but the last endorser.' He is the agent of the creditor, if not the creditor himself; and he is the person to answer inquiries as well as to give directions. Now the facts here, are, that the notary’s clerk, having ineffectually presented the precursor of the present note for payment, and wishing to learn the place of the first endorser’s residence, called to inquire about it at the store of the last endorser, whose wife, in his absence, gave a wrong direction, in pursuance of which the notice was left at the store of the first endorser’s son. Did the matter rest even there, no one would be answerable for it: the husband, however, who had, in the course of the same evening, been informed of his wife’s misdirection, did not think proper to correct it, but suffered the clerk, who relied on the accuracy of the former transaction which had passed without objection or dispute, to repeat the error when the note which replaced the former one, and which is the subject of the present controversy, came to be protested. Who was to blame for that? Though bound to know the residence of the parties, the depositor and apparent owner was. unable or indisposed to furnish the proper information; and his own misfeasance was consequently the cause of the loss. A notary, though bound to possess a competent share of skill, is not bound to know the residence of those on whom he is to call. Directions in respect to it, ought to be left at the bank, or, at the very least, the [114] depositing endorser ought to be, at all times, prepared to give full and precise information in respect to it. But whatever might be the remedy against the notary, it is clear that to the bank which acted gratuitously and according to the usual practice, there is no recourse. Judgment affirmed.