By the Court,
Mullin, J.Lord Mansfield, in Price v. Neale, (3 Bur. 1354,) as long ago as 1762, decided that the drawee of bills of exchange, one of which he had paid, without acceptance, the other after acceptance, could not recover back money thus paid; and the decision is, that it is incumbent on the plaintiff to be satisfied that the bill drawn on him was the drawer’s hand, before he "accepted or paid it, but it was not incumbent on the defendant to inquire into it. This case has been followed, both in England and in this country, without any doubt having been expressed by any of the judges, so far as I have been able to discover, as to its soundness. It is therefore laid down by elementary writers on the law of bills of exchange, that the acceptance, whether general, or for honor or supra'protest, after sight of .the bill, admits the genuineness of the signature of the drawer, and consequently, in favor of a bona fide holder for value without notice, if the signature of the drawer turns out to be a forgery, the acceptance *105will nevertheless be binding, and entitle such holder to recover thereon according to its tenor. (Story on Bills, § 262. Edwards on Bills, 433. Chitty on Bills, 628.)
In Story on Bills, section 411, after repeating the proposition that if the- acceptor has accepted a forged bill he must nevertheless pay, proceeds to say: “And if he has paid it, he cannot reco.ver back the money, although the forgery is established by the most conclusive evidence; for by accepting the bill he, by implication in favor of such (a bona fide) holder, admits its genuineness, and is not permitted to dispute it, afterwards, although1 he can have no recourse against the drawer for any reimbursement for his payment.” “This doctrine,” he says, “proceeds on the intelligible grounds, 1st. That the drawee, before he accepts, is bound, as a matter of duty, to ascertain whether the signature of the drawer is genuine or not, and next, that when one of two innocent persons must suffer, he who has caused a misplaced confidence, or has misled another, or has omitted his duty, shall suffer, rather than the other party.” (Bank of Commerce v. Union Bank, 3 N. Y. 230. Weisser’s adm’rs v. Denison, 10 id. 68. Levy v. Bank of United States, 1 Bin. 27. Smith v. Meseer, 6 Taunt. 76.)
If the principles of these authorities apply to the case in hand, they are. decisive of it, and the bank cannot recover in this suit
To justify the defendant in retaining the money obtained on the forged check, it must be a bona fide holder for value paid, and without notice. That it is such is conceded in the case.
A check on a bank is, in substance, a bill of exchange payable on demand and governed by the same rules applicable to those securities. (Edwards on Bills, 57, and cases cited.)
The case then comes to this. A forged check is received by the defendant in good faith, it having paid the full *106amount named in it, without notice of the forgeiy. The plaintiff, upon whom it is drawn, receives and pays it, without fraud or contrivance on the part of the defendant. These facts bring the case within the authorities above cited, and they apply to it with all their force.
The defendant’s counsel insists that this case is taken out of the principles of the' cases cited, on the grounds, 1st. Because the drawer of the check was not a customer, depositer or correspondent of the bank, and hence it cannot be presumed that its officers knew his handwriting; and, 2d. That this taking the check, in the manner stated in the case, by the defendant, was a part of its legitimate business as a savings institution; and the fact that the defendant took it, was calculated to, and did, induce the bank to pay the’check without exercising that care and caution which' it otherwise would have exercised.
„ As to the first ground, it is true that in the cases which have been up for decision, the proposition that the acceptor, by accepting, admits the genuineness of the signature of the drawer, and is liable upon the acceptance although the drawer’s signature may be a forgery, has been based on the presumption that the acceptor knew the handwriting of his correspondent. The argument is, that when the ground on which the presumption rests is swept away, the-presumption itself should not stand, and hence it would be competent for the acceptor to show that the drawer was not a customer or correspondent .of his, and therefore he did not know his signature.
I do not think the doctrine rests on the presumption suggested, but rather upon the presumption that before the drawee accepts or pays, he has made such inquiries and examinations as have satisfied him as to the genuineness of the signature and the propriety of acceptance or payment.' Knowledge of the genuineness of the signature is but one of several facts which it is important for a drawee to know, before accepting. or paying a bill. He must *107ascertain, first, whether the drawer is a person he knows, • and has business relations with; second, whether the state of accounts between them will justify or require him to accept or pay. A mistake in 'either of them is as fatal as in regard to the genuineness of the signature. Yet no one, I apprehend, would claim that if a drawee should accept or pay a draft or check, he could resist payment in the one case, or recall it in the other, because he was mistaken, in the identity of the drawer, or in the statement of the accounts between them. As to the latter—the state of the accounts—the case in 1 Binney is decisive.
In the Bank of the United States v. Bank of Georgia, (10 Wheat. 333,) the facts were: The plaintiff had received, in the course of its business, in good faith, bills of the defendant issued as money, and which, it was afterwards discovered, had been fraudulently altered. The plaintiff delivered these bills to the defendant, and the nominal amount of them was passed to tlje plaintiff’s credit, on the defendant’s books. After the forgery was discovered, the defendant paid to the plaintiff' the balance due to it, except the amount of the forged notes, and these were credited at their real and not nominal amount, and the plaintiff sued to recover the balance so withheld. ' The court held, Justice Story delivering the opinion, that the principles herein before stated applied to the case. He says, (p. 355 :) “ We think the defendants-were bound to know their own notes; and having once accepted the' notes in question as their-own, they are concluded by their adoption of the act, and cannot be permitted to set up the defense of forgery, against the plaintiff.”
If the bank, in that case, was bound to know its own notes, the plaintiff in this case is surely bound to know whether Crippen, the pretended drawer, was or was not a customer of the bank, and whether his account would justify the payment of the check.
It is not shown that the defendant is prohibited by a law *108of the State, or by its charter, from advancing the money on a check, for the accommodation of a stranger; and unless forbidden, it had the same right to take the check that an individual would have. The defendant owed the plaintiff no duty, imposed by custom or otherwise, to inquire into the genuineness of the check. It had the right to take the risk of advancing money upon it if it was forged, or if, for any other sufficient reason, the bank was justified in refusing to pay it. The plaintiff’s counter was the proper place at which to ascertain whether the check was genuine. If the plaintiff’s officers and clerks omitted to exercise the care and caution they would have used had the check been presented by some other institution or person, it has its agents to blame, and not the defendant. The case of Ellis v. The Ohio Life Ins. and Trust Co., (4 Ohio, 628,) turned, as I understand it, upon a custom of the banks in the place receiving checks on other institutions to inquire as to their genuineness. And by reason of such custom, the paying bank was presumed to exercise less care and caution than it otherwise would have done. In other words, the plaintiff was himself guilty of negligence, and could not, for that reason, recover.
There is still another ground relied on by the defendant to defeat a recovery in this case, which is deserving of consideration. The check purported to -be certified by the teller of the plaintiff’s bank, by writing his name across the face of the check. It is. not denied but that if the' signature was genuine, the bank would have been liable as upon a certified check. Such a certificate is held, in The Farmers’ Bank v. Butchers’ and Drovers’ Bank, (16 N. Y. 125,) to be equivalent to the acceptance of a bill of exchange, and imposes on the bank the obligation to pay the amount for which the check is drawn, to the holder, on demand. The acceptance is that of the bank, and is no more conclusive than is the payment of the check without acceptance. But the fact that the forged *109signature of the plaintiff' ’s teller was overlooked, together with the facts that the pretended drawer was not even a customer of the bank—had no account there out of which the check could be paid—demonstrates what would have been, otherwise, matter of inference, merely, that the plaintiff’s agents were guilty of very great neglect.
[Oswego General Term, July 14, 1863.Allen, Mullin, Morgan and Bacon, Justices.]
It seems to me that judgment must-be ordered in favor of the defendant, with costs.
Judgment accordingly.