International Firearms Co. v. Kingston Trust Co.

Coon, J. (dissenting).

I vote to reverse and to grant judgment to the plaintiff for the sum of $1,000, with interest from the date of the dishonor of the draft.

The facts are succinctly set forth in the majority opinion but, in my view, need some additions. It is undisputed that the draft was unconditional. The defendant bank was no party to the controversy between Betting and plaintiff’s predecessor. While I think that this controversy is immaterial and that the *175bank’s liability is defined by section 111 of the Negotiable Instruments Law, in view of the majority opinion I must refer to some additional facts.

The record clearly indicates that Retting realized shortly after he had contracted for the merchandise that he had made a ‘‘ bad bargain ’’ and any delay thereafter was due to him. A court of general jurisdiction where the contract was made and which clearly had jurisdiction in rem ” of the draft involved here, has decided that Retting is the one who breached the contract and has awarded the plaintiff title to and possession of the draft. The defendant bank should not have assumed any interest in the controversy between Retting and the plaintiff. When they did and repaid Retting the money is where the mistake was made. They were not obliged to repay him and could not be legally compelled to repay him. (Schweitzer v. Fargo, 255 N. Y. 60.) The bank apparently recognized this because they exacted from Retting an indemnity agreement (then good but now worthless).

A bank draft is irrevocable once issued and delivered. (Kerr S. S. Co. v. Chartered Bank of India, Australia & China, 292 N. Y. 253.) While the majority opinion suggests that the Kerr ease decides some things but not the question of title, I think it squarely decides that a bank draft is irrevocable. Here the bank attempted to revoke it. When the named payee presented the draft for payment, with no intervening transfer, in the absence of fraud or theft or forgery, none of which are claimed here, the drawer was obligated to honor it. In the absence of a claim of false identity there is no burden upon a named payee of a draft to establish his title or his being* a “ holder in due course. ’’

The defendant bank had nothing whatever to do with the merits of any controversy between Retting and plaintiff. It had nothing to do with the Canadian judgment. It did have an absolute obligation to pay its draft upon presentment. To permit the drawer of a bank draft to stop payment upon the unilateral request of the purchaser, without the consent of the payee or the physical return of the draft, would completely destroy the usefulness of a bank draft as a means of safe transmittal of cash. If payment could be stopped in this manner, a bank draft would be no more acceptable in commerce than a personal check, although for years, in commercial and banking circles, it has been an established custom to treat a bank draft as the equivalent of cash. (See Kohler v. First Nat. Bank of Tonasket (157 Wash. 417.)