LINSKY v. UNITED STATES, 6 F.2d 869

JOHNSON, Circuit Judge. The facts in this ease were not in dispute, and are as follows: Defendant gave an order for merchandise and a check for its price to the Board of Survey of the United States government on February 8, 1921. On February 10, 1921$ the Board of Survey caused the cheek to be certified by the Tremont Trust Company, upon which it was drawn. On February 15, 1921, the goods for which the cheek was drawn were delivered, and on February 17, 1921, the Tremont Trust Company was closed at the end of that business day by order of the bank commissioner of the commonwealth of Massachusetts.

The plaintiff deposited this check in the Federal Reserve Bank at Boston on the same day that the Tremont Trust Company was closed, and the following day the check was returned because of its closing. The defendant at all times had sufficient funds deposited in the Tremont Trust Company to cover this check, and upon its certification the Trust Company' deducted and charged the defendant’s account with the amount of the check.

The defendant proved his claim against the Trust Company, but was refused any credit in his proof of claim on account of the said cheek, and in consequence thereof has lost any and all dividends declared by said Trust Company to which he would be entitled because of said check. The check has always been retained by tbe plaintiff, and it bas not in any way attempted to effect tbe collection of tbe said check, other than by this suit. The declaration contains two counts; one upon tbe check, and tbe other upon tbe debt for which tbe check was given.

At tbe close of all tbe evidence, both tbe plaintiff and tbe defendant moved for a directed verdict. Tbe court ordered a verdict for tbe plaintiff, and tbe defendant duly excepted. Tbe refusal of the plaintiff’s motion and tbe granting of tbe defendant’s is assigned as error. As both parties moved for a directed verdict, they are concluded by tbe finding of tbe court, provided there is any evidence'to sustain this finding. Beuttell v. Magone, 157 U. S. 154, 15 S. Ct. 566, 39 L. Ed. 654; Williams v. Vreeland, 250 U. S. 295, 39 S. Ct. 438, 63 L. Ed. 989, 3 A. L. R. 1038.

As tbe facts were undisputed, tbe question presented for our determination is whether tbe trial court was right in bis application of tbe law to them. Under General Laws of Massachusetts, c. 107, §§ 210, 211, if tbe bolder of a cheek procures it to be accepted or certified, tbe drawer and all indorsers are discharged from liability thereon. In Minot v. Russ, 156 Mass. 458, 31 N. E. 489, 16 L. R. A. 510, 32 Am. St.

Rep. 472, it was held that, if tbe drawer of a cheek gets it certified for bis own benefit, and then delivers it to tbe payee, be is not discharged; but if tbe payee, for bis own benefit, gets it certified, instead of getting it paid, then tbe drawer: is discharged. In its opinion, at page 460 (31 N.

E. 490), tbe court said: “When a check payable to another person than tbe drawer is presented by tbe drawer to tbe bank for certification, tbe bank knows that it bas not been negotiated, and that it is not presented for payment, but that tbe drawer wishes tbe obligation of tbe bank to pay it to tbe bolder when it is negotiated, in addition to bis own -obligation. But when tbe payee or bolder of a cheek presents it for certification, tbe bank knows that this is done for tbe convenience or security of tbe bolder.” All of tbe decided eases are to tbe same effect. See 5 R. C.

L. p. 525, and cases cited; Times Square Auto Co. v. Rutherford National Bank, 77 N. J. Law, 649, 73 A. 479, 134 Am. St. Rep. 811; Sutter v. Security Trust Co. (N. J. Err. & App.) 126 A. 435, 35 A. L. R. 943, and note; First National Bank v. Whitman, 94 U. S. 343, 345, 24 L. Ed. 229; Born v. Indianapolis First Nat. Bank, 123 Ind. 78, 24 N. E. 173, 7 L. R. A. 442, 18 Am. St. Rep. 312; Jersey City First Nat. Bank v. Leach, 52 N. Y. 350, 11 Am. Rep. 708; Cincinnati Oyster, etc. Co. v. Nat. Lafayette Bank, 51 Ohio St. 106, 36 N. E. 833, 46 Am. St. Rep. 560.

Upon tbe record before us, there is nothing to take this case out of tbe operation of tbe law as stated in tbe authorities cited. The acceptance of tbe cheek by tbe Tremont Trust Company at tbe request of tbe payee, charging tbe same to tbe account of the drawer and retaining the funds, was equivalent to a redeposit of them by tbe payee. Times Square Auto Co. v. Rutherford Nat. Bank, supra. Tbe debt for which tbe check was given was therefore extinguished, and there could be no recovery, either upon tbe check or upon a count for tbe value of tbe goods.

Tbe judgment of the District Court is reversed, with costs to tbe plaintiff in error in this court, and tbe ease is returned tp tbe District Court for further action, not inconsistent with this opinion.