Myeks v. Union National Bank

Garnett, J. The first telegram from Haynes, Gordon & Co. to appellee was either a mere application for information or a request for acceptance. If the former, appellee is not estopped to deny its liability, because the reply stated the truth and appellant was not injured thereby; neither did lie purchase the drafts (or checks) on the faith of such reply. Treating the telegram, however, as a request to accept payable on the following Monday, the reply of the bank can not be regarded as a compliance with the request. There is a distinct implication in the words “ Drafts named are good now,” that the bank would not undertake to answer for the state of Snyder’s account beyond the moment when its telegram was sent. Myers did not regard it as an acceptance payab’e Monday, else he would not have demanded payment the Saturday previous. But his counsel argues that the reply of the bank was equivalent to writing “good” or “accepted” on the face of the paper. If so, the bank at once became the principal debtor, and was hound to pay whenever the paper was presented. Appellant did not consider that he had secured any such undertaking from appellee, but regarded it purely as a race of diligence. An acceptance is a contract, and does not differ from other contracts in the essential requirement of a meeting of minds. A hank is not bound to accept by telegram the checks or drafts of its depositors, although in possession of funds to pay. Its duty in such cases is to accept a draft, or pay a chock, only on presentment. One relying on a, telegram as an acceptance, should see to it that the language used will, at least, fairly bear the meaning. Rees et al. v. Warwick, 3 Eng. C. L. 467. The ease at bar is easily distinguishable from Coffman v. Campbell, 87 Ill. 98. There the defendants plainly said they would pay the draft, but added a phrase which did not explain itself. Having promised to pay in positive terms, the court held that if they desired to add a condition it should have fully expressed it. But here the intention to accept is not expressed; on the contrary, as we have shown, appellee’s telegram plainly implied that it would not agree to hold Snyder’s balance for any time to meet the paper held by Myers. Appellant contends that the making and delivery of the checks operated as a transfer to him of so much of Snyder’s deposit as was required to pay them, and that after receipt of the telegrams the bank could not pay to itself a debt due from Snyder, and thereby exhaust the fund which had been appropriated to the payment of the checks. For that doctrine reliance is placed on several cases decided by the Supreme Court of this State, but the only one which appears to have serious importance is Bank of America v. Indiana Banking Co., 114 Ill. 483. That was a contest between a check-holder and an attachment creditor. A garnishee summons was served on the bank after the check was delivered, and before the bank had notice of the check. After service of the garnishee process the bank paid the check, and the court held the payment rightful. But it is well settled that an assignment of a chose in action protects the assignee against subsequent garnishment of the debtor by the creditor of the assignor, if the defense is properly presented. Brake on Attachment, Sec. 527. In the case at bar the dispute is between two creditors, one of whom is a check-holder and the other the holder of a note payable at the same bank; it is equivalent to a contest between two check-holders. The sound doctrine in such cases is set forth in Morse on Banks and Banking, p. 266, as follows: “The rule with checks is, ‘first come first served.5 If payment is demanded at noon upon a check which the depositor’s unincumbered balance at that hour is sufficient to pay in full, the obligation of the bank to pay it in full is at once mature and perfect. It is no matter how many checks may be presented at later hours, or how much the sum of all the checks presented in the course of the day may exceed the amount of the customer’s balance. This is no concern of the bank, not even if it has been informed that such checks have been drawn and will be presented for payment. Its perfectly simple duty is to pay in full each check presented, at the time of presentment, so long as the unincumbered credit of the depositor suffices to enable it to make such payments in full.” This rule meets our approval. Any other must lead to endless confusion. Considering the merits of the respective claims we shall have no difficulty in holding the equity of the bank to be at least equal to that of Myers. There was no privity between them. Myers received his checks several days before Snyder made his deposit of $5,000 in the bank, hence he could not have relied on that deposit at the time he paid Snyder for the checks. In a similar case, First National Bank v. Pettit et al., 41 Ill. 492, the court said: “Wo do not see * * * upon what principle it [the bank] should be required first to pay a debt due from Allen [the depositor] to persons with whom it has had no transactions and who, if losers, are so by no fault of the bank. The debt due from Allen to it is as meritorious as that due the appellees,” the holders of the checks. The judgment is affirmed. Judgment affirmed.