United States Supreme Court Cases & Opinions

U.S. Supreme Court

United States v. National Exchange Bank, 270 U.S. 527 (1926)

United States v. National Exchange Bank of Baltimore

No. 222

Argued March 16, 1926

Decided April 12, 1926

270 U.S. 527

Syllabus

1. A drawee of a check or draft who is also the drawer is held, in paying it, to a knowledge of the true amount, and if, by mistake,

Page 270 U. S. 528

he pay to a bona fide holder for value without notice a larger amount to which the paper has been fraudulently raised, he cannot recover the difference from such holder. P. 270 U. S. 533.

2. This rule is applicable to the United States.

So held where a check was drawn on the Treasurer of the United States by a disbursing clerk of the Veterans' Bureau, raised and negotiated by the payee, and in due course taken and paid for at its fraudulent face by the defendant bank, which collected the same amount from the United States.

1 F.2d 888 affirmed.

Error to a judgment of the circuit court of appeals affirming a judgment for the bank in an action by the United States to recover the difference between the amount to which a check paid by it had been fraudulently raised and the amount for which it was drawn.

Page 270 U. S. 533