Thomas v. First National Bank

Mayes, C. J., delivered the opinion of the court. By agreement a jury was waived, and this case was tried by the judge on an agreed statement of facts. It is therefore unnecessary for us to set out at length any statement of the facts. The suit was instituted by J. S. Thomas against the bank for the purpose of recovering two hundred and eleven dollars. The agreed facts show that on and prior to the 23d day of October, 1909, [513] the appellant in this suit had on deposit in the First National Bank of De Funiak Springs, Fla., a credit balance of two hundred and eleven dollars. Appellant, being in Gulfport, wrote a letter from that point to the Florida bank.requesting the bank to send the amount of his deposit to him at Gnlfport, care of the general post-office delivery. In accordance with this instruction, the Florida bank sent a draft for the amount on a New York bank, payable to the order of appellant, J. S. Thomas; the Florida bank addressing the letter containing the draft to J. S. Thomas, Gulfport, Miss., care general delivery. The appellant was a white man and there was living in Gulfport at that .time a negro by the name of J. S. Thomas, and this negro also received his mail at Gnlfport. When the letter containing the draft reached Gulfport, October 25, 1909, it seems that appellant was not then in Gulfport; but the negro J. S. Thomas called for his mail at the general delivery, and the postal authorities delivered the letter intended for appellant and containing the draft to the negro of the same name. The negro opened the letter, and, finding the draft in it, took it to the First National Bank of Gulfport and indorsed same “J. S. Thomas,” representing that the check was his and that he was the true J. S. Thomas mentioned as payee. The negro was known to the officers of the Gulfport bank and was a depositor in same. When the draft was indorsed to the bank by the negro, the bank paid the money to the negro J. S. Thomas. Subsequently, the Gulfport bank discovered some little mistake in the protectograph stamping of the draft, which mistake was made by the Florida bank when it issued the draft. The Gulfport bank returned the draft by mail to the Florida bank, calling their attention to the error, and requesting the Florida bank to send another draft in its place. The Florida bank merely retained the original draft and in the place of same sent another one for the same amount, but this time made it payable to the [514] Gulfport bank; the former draft having been already-indorsed to the Gulfport bank by the negro, J. S. Thomas. The draft was finally paid to the Gulfport bank when it was presented for payment in New York. The Gulfport bank had no knowledge of the fact that the negro did not.own this draft.. Appellant, J. S. Thomas, the white man, subsequently learned from the Florida bank that the Gulfport bank had collected the two hundred and eleven dollars, and when he received this information he went to the Gulfport ban!?: and claimed the draft and the proceeds thereof, demanding that the Gulf-port bank pay the same. J. S. Thomas, the real owner of the draft, notified the Gulfport bank that the indorsement was a forgery. The Gulfport bank refused to reimburse the true owner. The negro, J. S. Thomas, in the meantime had left for parts unknown. In other words, the facts of this case conclusively show that the appellant was the owner of the draft, and that the negro-who presented it had no interest in it, and had forged the indorsement of the true owner and collected the proceeds from same. Some other facts are agreed to, but. we do not think they are important in the consideration of this case. The question in this case is simply this: Where there are two people of the same name, and a. check, by accident, reaches the hands of the wrong person, and the person wrongfully obtaining the check indorses his name on same and receives the proceeds from an innocent third party, is such an indorsement a forgery, and is the innocent party protected as against the true owner? The trial court held that it was not such. a forgery as would fasten any liability on the bank, and from this judgment this appeal is taken. There seems to be little dissent in the authorities; almost, if not quite all, the authorities holding that under such circumstances the party paying the check to the-one forging the indorsement is not protected. Under such circumstances, it is nothing but a forgery. The515 true owner of the check is not placed beyond the protection of the law because some unscrupulous person of the same name lives in the same town with him. The true owner has never parted with his title, and his property is not to be taken away from him without his consent merely because the check happens to fall into the hands of another of the same name. Banks taking checks must know the true parties claiming to own them —in fact, who do own them — and they act at their peril. Where there are two or more persons of the same name, it cannot be anticipated that one of them will commit a crime and forge the name of the other to an instrument which may have accidentally come into his hands. The true owner of the check was guilty of ng sort of neglect which would operate as an estoppel on him. ITe had a right to have his mail sent to him at the general delivery at Gulfport. In the case of Beattie v. National Bank of Illinois, 174 Ill. 571, 51 N. E, 602, 43 L. R. A. 654, 66 Am. St. Rep. 318, the court holds that: “Where a bill is payable to the order of a person, and another person of the same name of the payee gets hold of it and indorses it to a party who takes it in good faith and for value, such party acquires no title to the bill. If the indorsement, so made by a person who is not the real payee but has the same name as the real payee, is made by such person with full knowledge that he is not the real payee, and with intent to perpetrate a fraud, his indorsement cannot be regarded otherwise than as a forgery.” To the same effect are many cases cited in the opinion in the above case. It is true that Mr. Morse, in his work on Banks and Banking, at page 851, states in his text that under such circumstances he does not think that the rule announced above is correct; but he admits in this same text that, “though the propriety of the rule may be criticised, it must be admitted that it lays down the only adjudicated [516] law in the premises, except a remark made in an old case in New Hampshire;” and he further says, “The only English authority is to the same effect.” Mr. Morse’s view is that “the technical rule of law declaring the indorsement under such circumstances a forgery is too strong for the principles of justice;” but he is much alone in this view. We prefer to follow what seems to be the settled authority upon this subject, not only because the authorities are that way, but because we differ from Mr. Morse and believe that the principles of justice announced by the decisions are more in accord with true principles of right than the view stated by Mr. Morse. It is difficult for us to understand by what principle of right a man should have his money or valuables taken from him because he has the misfortune, through no fault of his own, to have the same name as some other person in the same town. It is difficult for us to understand how the true owner of a draft may lose his property rights in same by reason of the fact that it has fallen into the hands of another person of the ■same name and that other person has forged an indorsement of his name to the instrument and obtained money for it when the true owner knew nothing about it. In the Beattie case, in 174 Ill. 571, 51 N. E. 602, 43 L. R. A. 654, 66 Am. St. Rep. 318, supra, the court held that the true owner of a draft could recover its value where the person receiving it had the same name, but not the same middle initial. In other words, in the Beattie case, in 174 Ill. 571, 51 N. E. 602, 43 L. R. A. 654, 66 Am. St. Rep. 318, the draft sued upon was made payable to the order of one George A. Bent, when in truth it was intended for George P. Bent. The draft was mailed to George A. Bent, and George A. Bent received it and indorsed upon it his own name and sold it to a purchaser in good faith;- but the court held, notwithstanding this, that the purchaser got no title, saying: “It is true that the real and intended payee of the draft was ■ named [517] George P. Bent; but tbe fact that the name of the real owner and the name of the fraudulent possessor of the draft differed, so far as the middle letter of the name is concerned, does not make the case other than a case where the real name of the payee and the name of the assumed payee are the same. This is so because the law does not regard the middle initial as a part of a person’s name, but only recognizes one Christian name of a party. ’ ’ It is readily seen that the above case is a stronger case than this one because there was a difference in the name; that is, a difference in the initial. But in this case there was not such a difference, but the name was identical. The case is reversed, and judgment here for appellant. Reversed.