Merchants' Bank v. Bank of Commerce ex rel. Hoffman & Co.

Cochran, J., delivered the opinion of this Court. The question as to the right of action, raised by the appellant’s 3d, 4th, 5th and 6th prayers, is the first to be considered. The substantial proposition of these prayers is, that the appellant was relieved from liability for negligence in failing to collect tho draft on Lee & Co., by the subsequent, payment of it by Hoffman & Co., notwithstanding their liability upon it as drawers was extinguished by that negligence, and their payment made under a mistake of fact that legally entitles them to a return of the money! The- ⁵² effect of this payment on the appellee’s right of action is, therefore, the real matter to he considered.

The theory of the appellant in regard to it appears to us to be founded, in some measure, upon a misapprehension of the principles applicable to that state of case. Treating the payment, according to the hypothesis of these prayers, as one made by mistake, it certainly was one that conferred no benefit on the apipellee, and we think it equally clear that it could not operate for the advantage of the appellant in the way of discharging, or suspending its antecedent liability to the appellee. As the amount of the draft was paid by Hoffman & Co., under a mistake that entitles them to a return of the money, the appellee must be regarded as having received it for their use, and as holding it subject to their order. In legal contemplation the payment was a deposit, for which the appellee must account, and which, instead of suspending or discharging the appellants from their existing liability to the appellee, charges the appellee with one of an entirely different character to Hoffman & Co. This in our opinion was the only legal effect of that transaction, and there is no reason for supposing that it changed or affected, in the slightest degree, any right or liability growing out of, or founded upon the previous relations of the parties here.

The cases of Merryman vs. State, 5 H. & J., 423 , and Whitney vs. Ind. Mut. Ins. Co., 15 Md. Rep., 298 , bear upon this question and tend to support the conclusion we have reached.

Nor was it essential to the appellee’s right of action, that the jury should find that the draft was returned to the appellant. The claim asserted here, is not upon the draft, but one sounding in damages for the loss caused by the appellant’s negligence and consequent failure to collect it ; the appellant did not undertake for the payment of the draft, but to exercise due care and diligence in collecting it, an undertaking wholly different in its nature from that ⁵³ of any insurer, surety or party to tlie draft, and one that renders the production and return of the draft unnecessary to the appellee’s right to recover. But this is not all ; the case proceeded on the theory that the draft was rendered valueless by the appellant’s misconduct in regard to it, and if there was evidence from which that fact could be, or was found, there is no reason for supposing that the appellant was prejudiced by the appellee’s failure to surrender it. We think these prayers were properly rejected.

A review of the objections, made to the instructions given by the Court in lieu of all the prayers offered on both sides, will dispose of the remaining questions presented by the bill of exceptions. Those objections are founded mainly on two grounds, 1st, that the instruction treats the question of diligence as one of fact for determination by the jury ; and 2d, that it submits that question to the jury on a hypothesis of fact, in some particulars