Chicopee Bank v. Philadelphia Bank
75 U.S. 641

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U.S. Supreme Court

Chicopee Bank v. Philadelphia Bank, 75 U.S. 8 Wall. 641 641 (1869)

Chicopee Bank v. Philadelphia Bank

75 U.S. (8 Wall.) 641

Syllabus

1. Although a bill payable at a particular bank be physically and in point of fact in the bank, still, if the bank be wholly ignorant of its being there -- as when, ex. gr., a letter in which the bill was transmitted when brought from the post office to the bank has been laid down with other papers on the cashier's desk, and before being taken up or seen by the cashier has slipped through a crack in the desk, and so disappeared -- the fact of the bill's being thus physically present in the bank does not make a presentment.

And this is so although the acceptor had no funds there, did not call to pay the bill, and in fact did not mean to pay it anywhere.

2. In such a case, therefore, the holder cannot look to prior parties, even though, by having been informed after inquiry by him that the bill had not been received at the collecting bank, they could have inferred that it had not been paid at maturity by the acceptor.

3. A court having fairly submitted to a jury the evidence in a case, and charged as favorably to a party as he could properly have asked, may, in the exercise of its discretion, refuse a request by that party to charge as to which side the burden of proof belongs.

4. An accidental loss or disappearance in a bank of a bill sent to it to collect, from the bank's not taking sufficient care of letters brought to it from the mail, carries with it a presumption of negligence in the bank; and on a suit against it, the burden of proof is on the bank to explain the negligence.

5. If, through this negligence alone, it is inferable that notice of presentment, demand, and nonpayment were not given to the holder so as to enable him to hold parties prior to him, the bank guilty of the negligence is responsible to the holder for the amount of the bill even though the holder himself have not been so entirely thoughtful, active, and vigilant as he perhaps might have been.

This was a suit by the Seventh national Bank of Philadelphia against the Chicopee Bank of Springfield, Massachusetts, founded upon the allegation, that by reason of the neglect of the latter bank, the former lost its remedy against the prior parties on a bill of exchange, to-wit, the drawer and payee.

The bill was drawn by one Coglin, of Philadelphia, on Montague, of Springfield, payable to one Rhodes, of Philadelphia, for $10,000, and accepted by Montague specially payable at the Chicopee Bank. The day of payment was Saturday, February 18, 1865. On the 13th, Rhodes, the

Page 75 U. S. 642

holder, endorsed the bill for value to the Philadelphia bank, which sent it at once by mail, enclosed in a letter, to the Chicopee Bank, to receive payment. The course of the mail between Philadelphia and Springfield is two days. On the 15th, this letter with other letters and papers, was duly delivered by the postman, and placed on the cashier's table, but (as was afterwards ascertained) this letter slipped from the pile, through a crack in the table, into a drawer of loose papers, and its presence in the bank was not known to the cashier, and as the two banks had no previous dealings, he was not expecting anything from the other bank. On the 18th, Montague, the acceptor, made no attempt to pay the bill either by calling for it or depositing funds, and subsequently, at the trial, made oath that he intended not to pay the bill, and had a defense against it. The cashier of the Philadelphia bank, not receiving, on the 17th, an acknowledgment of the letter which he had sent on the 13th, felt somewhat anxious, and on the 18th consulted the president. On Monday, the 20th, he telegraphed to the cashier of the Chicopee Bank as follows:

"Did not you receive ours of 13th instant, with Montague's acceptance, $10,000?"

The dispatch did not indicate either the time or place of payment of the draft, and the reply was sent,

"Not yet received."

This dispatch was received by the cashier of the Philadelphia bank at noon of the 20th. He testified at the trial that he wrote to Mr. Rhodes the same day, informing him of what he had learned, that he had no recollection of writing to Coglin, but, as he knew they were jointly concerned in dealings in petroleum lands, he presumed Rhodes would inform him. This was the only step the cashier took toward charging the prior parties. They both did business at that bank -- Coglin was a director; both were frequently there and well known to the cashier. As the mail required two days, and the 19th was Sunday, there was no question but the cashier

Page 75 U. S. 643

had until and including the 24th to give notice to Rhodes and Coglin. After the receipt of the reply of the 20th, at noon, he took no steps, by post or telegraph, to ascertain from the Chicopee Bank whether the acceptor had or had not been ready to pay on the 18th. The Philadelphia bank brought no suit against Rhodes or Coglin, but sued the Chicopee Bank for the amount of the note on the ground that, by its negligence, they had lost the power to charge the prior parties.

The court below instructed the jury that the prior parties were absolutely discharged by what took place at the Chicopee Bank on the 18th; that where a bill is accepted payable at a particular bank, the bank need not seek the acceptor, but that there must still be a presentment in order to charge prior parties; that the presence of the bill at the bank, ready to be delivered to the acceptor upon his tendering payment, was equivalent to a presentment, but that if the bill is not at the bank on the day of payment, ready to be delivered as aforesaid, there is a failure of presentment, and the prior parties are discharged, although the acceptor made no attempt to pay; that in this case, therefore, the prior parties could not be held by any notice of whatever description, whenever or by whomsoever given, and that if the loss or mislaying of the bill during the whole of the 18th was owing to the negligence of its cashier, the Chicopee Bank was liable for the amount of the note.

After the charge was fully delivered, the court was asked by the counsel of the Chicopee Bank to instruct the jury as to the burden of proof. This the court refused to do, considering that it had already sufficiently instructed the jury.

The verdict and judgment were accordingly for the plaintiffs.

Page 75 U. S. 648

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