Well v. Corn Exchange Bank

Lehman, J. (dissenting).

The defendant herein received a check from the plaintiff and thereupon, with the plaintiff’s consent, credited the plaintiff’s account with the amount of the check before collection, and thereby became a purchaser of the check and not a holder for collection only. Metropolitan National Bank v. Loyd, 90 N. Y. 530. The bank, however, still owed the plaintiff the duty to collect the check or to return it to the plaintiff with his rights against ¿he parties to the check unimpaired. In this respect, its duties are the same as if it had taken the check only for collection. Martin v. Home Bank, 160 N. Y. 190. Payment of this check was refused, and the bank failed to give the plaintiff prompt notice of dishonor, but informed him, some days thereafter, that he could have the check only by giving a new check for the same amount.

The plaintiff protested that his account was ample to cover this check, but, when informed that the hank’s rules required its clients to give a new check before receiving the old check, he complied with the alleged rules. I do not think that this was a waiver of the neglect of the bank that could bar the plaintiff’s right of action. Section 180 of the negotiable Instruments Law provides that notice of dishonor may be. *303waived, even after the omission to give due notice, and the waiver may be implied. It appears to me that this section was meant to cover all cases where the notice of dishonor was a condition precedent to a recovery, but not a case where the failure to give notice of dishonor has become the basis of an affirmative right of action for neglect. In such a case, the waiver of the neglect would amount to a release of a cause of action already complete; and I think no acts can have such a result, unless they constitute an accord and satisfaction. If the bank, as a purchaser of the check, were attempting to hold the plaintiff as a prior party, then the bank might, perhaps, claim that its failure to give notice of dishonor could be waived, as the prompt notice would then be simply a condition precedent to a recovery upon its part which, like other conditions, may properly be waived; but the plaintiff here is suing to recover for the neglect of the bank, a neglect which he had not waived before its commission and had not released after its commission. It is true that, if the act of the plaintiff did amount to a waiver of the notice of dishonor, even as a condition precedent to a recovery by the defendant, the plaintiff should not be allowed to recover here; because the defendant would then have a right of action against the plaintiff as a prior holder, and there would be simply a circuity of action.

Such a waiver must be clearly established and will not be inferred from doubtful or equivocal acts or language. Ross v. Hurd, 71 N. Y. 14, 18. In this case, it appears to me that the acts and language of the plaintiff showed only an intention to wipe out the previous credit by the bank of the amount of the check to his account. They should be given no other force, and the plaintiff should be allowed to recover damages for the uncontradicted neglect of the defendant.

The judgment should be affirmed, with costs.

Judgment reversed and new trial ordered, with costs to appellant to abide event.