THE MERCANTILE NATIONAL BANK OF THE CITY OF NEW YORK, Respondent,
LOUIS SILVERMAN, Appellant.
APPEAL by the defendant, Louis Silverman, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of New York on the 17th day of January, 1911, upon the verdict of a jury rendered by direction of the court, and also from an order entered in said clerk's office on the 9th day of April, 1911, denying the defendant's motion for a new trial made upon the minutes.
David J. Gallert [Walter S. Heilborn with him on the brief], for the appellant.
Joseph M. Hartfield, for the respondent.
This is an action on a promissory note upon which the defendant admitted his liability, but pleaded facts on which he demanded that the amount of two checks paid by the plaintiff and charged to his account be set off. This defense was overruled. The liability of defendant excepting as to the amount for which he claims an offset has been adjusted, and the single question remaining in the action and presented by the appeal is whether the defendant was entitled to have the amount of the checks deducted from his liability on the note.
The appellant was a private banker, conducting business in the city of New York, and for a long time he had been accustomed to purchase claims of officers of the United States army for their salaries to grow due in the future, and to take assignments of their vouchers therefor. He had a drawing account with the plaintiff, and the checks which were charged to his account, and the amount of which he seeks to offset herein, were drawn and dated on the 16th day of September, 1907. One was for $900, payable to the order of 'Lieut. Col. Frederick Marsh,' and the other was for $526.50, payable to the order of 'Capt. J. A. Shipton.' The Marsh check was
indorsed 'Frederick Marsh, Lieut. Col. C. A. C.,' meaning Coast Artillery Corps, and was deposited for collection and collected through the American National Bank of Washington, D. C., which by indorsement made it payable to the order of the Fourth National Bank of New York, and expressly guaranteed prior indorsements, and it was paid through the New York Clearing House. The Shipton check was indorsed 'Capt. J. A. Shipton,' with 'Frederick Marsh' underneath it, and it was likewise deposited for collection with the American National Bank of Washington, D. C., and similarly indorsed by it and paid through the New York Clearing House. There were officers in the United States army bearing the names and titles of the payees of these checks, but the checks were neither received nor indorsed by them but by an impostor. The impostor called on and represented himself to the assistant cashier of the American National Bank of Washington, D. C., as Lieutenant-Colonel Marsh, and exhibited some envelopes addressed to him by that title at the New Willard Hotel, Washington, D. C., but he was not known to any of the officers of the bank, and no further identification was received or demanded. He presented the checks to the assistant cashier and stated that he wanted to leave them for collection, and did not wish to draw the money until after they were collected. He signed a blank signature identification card, for opening an account, in the presence of the assistant cashier and filled out a deposit slip describing these checks as if they were to be deposited to his credit, but they were not so deposited until collected. The indorsement 'Frederick Marsh' on the checks was in the same handwriting as the signature on the identification card, and the imposter also wrote Shipton's title and name as indorser on the check payable to Captain Shipton. At the request of the impostor the assistant cashier advanced $25 on his own responsibility before the checks were collected, and after collection the total amount, less the collection charges, was paid over to the impostor, but not all at one time.
The appellant was not personally acquainted with either Lieutenant-Colonel Marsh or Captain Shipton, and had had no business transactions with either of them; but, in due course of mail, he received a letter under date of September 11, 1907,
written on the stationery of the New Willard Hotel, at Washington, D. C., purporting to be signed by 'Frederick Marsh, Lieut. Col. Coast Artillery Corps,' and stating in substance that the writer observed by an advertisement in the Army and Navy Register that appellant discounted monthly pay vouchers for army officers, and stating his monthly salary; that he desired to have appellant cash his vouchers for October, November and December of that year; that his station was the Presidio, San Francisco, Cal., but that for the remainder of the year he was to be on duty in the office of the chief of artillery at Washington; that 'Captain James A. Shipton, Coast Artillery Corps,' who was likewise on duty in the office of the chief of artillery, was indebted to him and had agreed to transfer his pay vouchers for the same months, and stating his monthly salary, and, in effect, that he also wished to have those cashed, and requesting that a reply be sent in care of said hotel. The appellant the next day by letter addressed 'Col. Frederick Marsh, The New Willard, Washington, D. C.,' answered the letter stating that on the receipt of the pay accounts of Marsh and Shipton for the months in question, he would remit by check the amount thereof less the discount stated, which he was to deduct for his charges. Under date of September 14, 1907, appellant received a letter, signed the same as the first, inclosing vouchers on the forms in use by the pay department of the United States government for the pay or salaries of such officers, purporting to be the pay vouchers of those officers for said months and to be certified by them, with an assignment thereof transferring the amount to the appellant, likewise purporting to be signed by them. It is stipulated that all the signatures were written by the impostor. Under the same date appellant received a letter also written by the impostor, either inclosed with the other letter and vouchers or in a separate envelope signed 'James A. Shipton, Captain C. A. C.,' requesting him to send check for the amount of his vouchers, less the discount, to Colonel Marsh, and stating that if appellant preferred he might consolidate this amount with the proceeds of Colonel Marsh's vouchers. There is no evidence that there was any similarity in the handwriting of the various documents or
signatures, which was discoverable by ordinary inspection, and no claim is based thereon. On the receipt of these letters and vouchers, appellant inclosed the checks, either in one envelope addressed to Marsh by his official title, or in separate envelopes, the one payable to the order of Marsh addressed to him, and the other addressed to Shipton by his official title, at the New Willard Hotel at Washington, D. C., but as to which, the testimony of the appellant is uncertain. The appellant knew, by an examination of the Army and Navy Register before answering the first letter, that there were such officers and where they were regularly stationed which corresponded in that regard with the information contained in the letter; but he ...