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Pole & Co., Smith's bankers, on account of the bankrupt, on the day after the date of the cheque.
Best, C.J., said " This objection, though manifestly against the justice of the case, must nevertheless prevail, there being no evidence from which the jury could legally presume the existence of the petitioning creditor's debt. The only proof to favour such a presumption was the possession of the cheque by the drawer; but as it appeared that he, as assignee, had the possession of all the bankrupt's papers, the fact of the cheque being in his hands was not alone evidence of payment. There was no proof that the cheque had actually been in the hands of Messrs. Sykes, Snaith & Co., neither was there any proof that this cheque had been paid to them by Sir Peter Pole & Co. In order to identify it, and make it evidence of the existence of the supposed debt, the clerk who paid it should have been called to prove the fact of payment." Bleasby v. Crossley (11 Moore's Reports, 327).
2. A cheque is no evidence of a loan from the drawer to the payee.
This has been already stated incidentally in some of the foregoing judgments. The following case is expressly in point. It was an action brought by the plaintiffs as executors, for money lent to the defendant by the testator in his lifetime. The testator had died in the year 1798.
It was proved that in his lifetime he had kept cash at the house of Wright & Co, who were bankers, and who had also been bankers to the defendant since the testator's death; so that the person of the defendant was well known at the banking-house, to the clerks employed there. To establish the loan of the money by the testator to the defendant, the plaintiff then produced a draft drawn by Greatorex, the testator, in his lifetime, on Wright & Co., his bankers, in the month of February, 1797, payable to the defendant; and it was proved by a clerk in the banking-house that that draft had been paid to Gerrish, the defendant, out of the money of the testator at that time in their hands.
Lord Kenyon said "This is no evidence to establish a debt; no evidence is offered of the circumstances under which the draft was given: in might be in payment of a debt due by the testator, or the defendant might have given cash for it at the time. From the circumstance of the defendant's name being used in the body of the draft, no inference can be drawn; it is perfectly arbitrary what name is used in drawing a draft on a banker, a man uses the name which first occurs to him. If the plaintiff had shown any money transactions between the defendant and the testator, from whence a loan could be inferred, or any application by the defendant to borrow money at the time, that, coupled with the giving of the draft, might be evidence to go to the jury; but,
standing a naked transaction as it does, it is not evidence; and the plaintiff must be nonsuited." Cary et alt, Executors of Greatorex v. Gerrish (4 Espinasse's Reports, 9).
The following case was decided on the same principle. It was an action for money had and received, brought to recover back the premiums paid upon policies. The defendants gave notice of set-off, and proved on the trial numerous cheques drawn by the defendants on the bankers, and delivered to the plaintiff, to whom the bankers had paid them. It appeared that there had been transactions between these parties to a very large amount. The plaintiffs objected, that it was necessary to show on what consideration, or for what purpose, these cheques were delivered, in order to apply them to this set-off; and that they did not prove any payment without evidence of the circumstances under which they were given. A verdict passed for the plaintiff, and a rule nisi had in the last term been obtained to set it aside. Serjeants Shepherd, and Best, would now have supported the rule, but the Court interposed.
Sir James Mansfield, C.J.-"I am sure I remember a case before Lord Mansfield, C.J., in which a cheque given was produced as evidence of a debt, and his lordship held that that alone was not sufficient."
Chambre, J.-"All our accounts would be in inextricable confusion, if such evidence were allowed." Rule discharged. Aubert v. Walsh
(4 Taunton, 293): see also, Graham v. Cox (2 Car. and K. 702): Welch v. Seaborn (1 Stark. 474).
3. Where the cheque is not received as money, and is not cashed, it will not operate as evidence of a payment.
Thus, in the case of Hough v. May, it appeared that the plaintiff's account amounted to £8. 18s., and that several applications had been made to the defendant for payment. On the 7th of November the defendant sent a cheque in the following form to the plaintiffs :
"7th November, 1835. "Messrs. Dorein and Co.-Pay Messrs. Hough and Co., balance account railing, or bearer, £8. 11s.
" WILLIAM MAY."
On the 13th the plaintiff's attorney wrote a letter to the defendant, informing him that the cheque was lying at his office uncashed, and the defendant might have it back. The Under-Sheriff left it to the jury to say whether the cheque was received as payment of £S. 11s.
The jury found their verdict for the plaintiffs for £8. 18s., saying that the cheque was not received as money; and leave was reserved for the defendant to reduce the verdict to 7s., if the Court considered that the cheque operated as
payment. A rule was accordingly obtained and argued.
Lord Denman said-" There really is no doubt upon the matter. The question at issue is, whether the plaintiffs have been paid to the amount of £8. 11s. The cheque of itself could not be any payment; it must either have been accepted at the time as money by the party taking it, or it must have been afterwards paid. Besides, this was a conditional cheque for the payment as a balance, and on that account could not be a payment, for the party was not, on that account, bound to receive it." Hough v. May (2 Harrison's Reports, 33).
4. On the production of a cheque in custody of bankers.
The question in dispute in a cause, being as to the partnership of the defendants, to show a joint payment by them,
Gurney, counsel for the plaintiff, called for the production of a cheque which a witness stated was in the hands of the defendants' bankers.
Scarlett, counsel for one of the defendants, objected that the plaintiff's counsel ought to call the banker's clerk to produce it.
Bayley, J.-" The bankers are your agents; you would have a right to go to the bankers and demand the cheque of them." Burton v. Payne
(2 Carrington and Payne, 520).