Hart & Hoyt vs. Palmer, 12 Wend. 523

By the Court, Nelson, J. The plaintiffs cannot recover. Their rights are no greater than those of the firm of Ford, Bissell & Co., for whose benefit they were to collect the note, and to whose credit they were to apply the proceeds. Ford; Bissell & Co., could not sustain an action against the defendant. Bissell, the maker of the note, in his letter of the 7th March, represented himself and firm in a prosperous condition as to business, by way of inducement to the defendant to endorse his paper; and the case shows that his firm was wholly insolvent at the time, and have so remained ever since.

Bissell being one of the firm to whom the note was transferred, and for whose benefit, by intendment of law, collection is sought, the firm is chargeable with full knowledge of the representation made by him ; and whether it was made fraudulently, or through a mistaken apprehension of his affairs, it would be unjust and against conscience to permit a recovery: it would be sanctioning the perpetration of a gross fraud upon the defendant by the firm of Ford, Bissell & Co. New trial granted.