Townsends v. Bank of Racine

By the Court, Whiton, C. J. We think there can be no doubt that the refusal of the bank to redeem its bills on the 20th of December, 1856, was, prima facie, a failure of the bank. We are also of opinion that the payment made for the draft, if made in the bills of a bank which had failed, was no payment. The authorities which were cited by the appellants at the argument, seem fully to sustain this position : 2 Greenlf. Ev., § 522; Ontario Bank vs. Lightbody, 13 Wend. 104; Fogg vs. Sawyer, 9 N. H. R., 365; Gilman vs. Peck, 11 Vt. R., 516. It follows, as we think, that upon proving these [194] facts to the satisfaction of the jury, the plaintiff would have made out his case prima facie. It appears by the bill of exceptions that the judge instructed the jury that if they believed from the evidence “ that the bank had a right to take fifteen days to pay specie on its bills after presentation, then the refusal to pay on demand, on the 20th of December, 1856, was not a failure.” There is nothing in the bill of exceptions which enables us to see the pertinency of this instruction, because the testimony as contained in the bill of exceptions does not tend to establish that fact. The witness Clark, testifies that when the bills were presented to the bank, on the 20th of December, “ I refused to pay the bills in specie, and claimed fifteen days as the law allowed the bank.” We do not suppose it will be contended, that this testimony was sufficient to establish the fact, that the law of the state in which the bank was situated, authorized the bank to refuse to pay its bills for fifteen days after they were presented for payment. As the bill of exceptions does not purport to give all the testimony, we suppose there was testimony upon this subject which is not contained in the bill of exceptions, and to which the instructions of the judge related. In the absence of this testimony we cannot say as the judge committed an error in giving this instruction to the jury. It appears that the judge further instructed the jary «that it was the duty of the plaintiffs as soon as they ascertained the facts in the case, and within a reasonable time, to have offered to return the bills to the defendant, and that without such offer to return, the plaintiff could not recover. We think this instruction of the judge was erroneous. The failure to return, or offer to return the bills before bringing the suit, would probably, under any circumstances, only affect the measure of damages. Ontario Bank vs. Lightbody, 13 Wend., 104. But whether this is so or not, we think the judge should have explained to the jury what he meant by [195] the words "within reasonable time.” It does not appear when the plaintiffs first became acquainted with the fact, that the purchase of the draft was made for the bank. The course pursued by the bank in making the purchase appears to have been somewhat singular. Carpenter was employed to buy the draft in the name of John Wilson, by the direction of Ulman, who was president of the bank. Magneburgh, the clerk of the plaintiffs, who sold the draft to Carpenter, testified that he did not know the person to whom he sold the draft at the time the sale was made. That upon learning that the bills in question were bad, he sent out to find the person from whom he took them. It appears pretty conclusively from the testimony, that the interest of the bank in the purchase of the draft was concealed from the plaintiffs. Whether intentionally or not is not disclosed. Under these circumstances we think the judge should have told the jury, that if the bills were returned or offered to be returned within a reasonable time after the fact was ascertained by the plaintiffs, that the bank was the purchaser of the draft, the case of the plaintiffs was, in this respect, fully made out, so as to entitle them to a recovery of the full amount of the bills in question. If the agents of the bank paid out the bills innocently, and they were retained by the plaintiffs an unreasonable time after their character became known to them, and after they became aware that the bills were in fact paid out by the bank, it seems clear from the authorities that whatever loss was caused by the depreciation of the bills in value while they were thus retained by the plaintiffs should be borne by them; and perhaps this should be the rule, although the agents of the bank intended to commit a fraud, by paying out the bills: but upon this subject we give no opinion.