Town and County Advance Company, Ltd, v Provincial Bank of Ireland, Ltd

• Jurisdiction: Ireland
• Judgment Date: 26 April 1917
• Date: 26 April 1917
• Court: King's Bench Division (Ireland)

Town and County Advance Company, Ltd.

and

Provincial Bank of Ireland, Ltd. (1).

K. B. Div.

CASES

DETERMINED BY

THE KING'S BENCH DIVISION

OF

THE HIGH COURT OF JUSTICE IN IRELAND,

AND ON APPEAL THEREFROM IN

THE COURT OF APPEAL,

AND BY

THE COURT FOR CROWN CASES RESERVED.

1917.

Cheque — “Fictitious or non-existing” Payee — Intention of Drawer — Bills of Exchange Act, 1882 (45 & 46 Vict. c. 61), s. 7, sub-s. 3.

On the strength of what subsequently proved to be a forged promissory note, the plaintiffs sent by post a crossed cheque drawn by them in favour of M. or order for the amount of an advance. P. intercepted the cheque and brought it to the D. branch of the defendant bank, and, having endorsed it first as M. and next as P., received payment of the amount of the cheque.

In an action by the plaintiffs against the defendant bank to recover the amount of the cheque as money had and received by them to and for the use of the plaintiffs:

Held, that the payee was not “a fictitious or non-existing person” within the meaning of sect. 7, sub-s. 3, of the Bills of Exchange Act, 1882; that therefore the cheque could not be treated as payable to bearer; and that the plaintiffs were entitled to judgment.

Vinden v. Hughes, [1905] 1 K. B. 795, and North and South Wales Bank, Ltd., v. Macbeth, [1908] 1 K. B. 13; [1908] A. C. 137, followed and applied.

New Trial Motion.

This action was tried before Dodd J. without a jury on 9th of February, 1917, when the learned judge gave judgment for the plaintiffs for £50 and costs. The plaintiff's claim was for £50, money payable by the defendants to the plaintiffs for money had and received by the defendants to and for the use of the plaintiffs.

The facts of the case, which were undisputed, were as follows:—

A man named Philip Patrick Higgins, who lived near Dungarvan, got into correspondence with the plaintiffs, who were a loan company in Newry, and in that correspondence he always signed himself as “M. P. Higgins.” In reply to his application for a loan, the plaintiffs sent him a list of questions to answer, and, in his replies to such questions, he stated that he was a bonâ fide farmer, owning three small farms in the townland of Kilgrovan, Co. Waterford, and that two of these farms were bought out; that the stock and farming implements on his farms were worth about £100; that he was married and had two young children, and that his name was Michael P. Higgins. In order to substantiate his statement that he owned the three farms, he sent to the plaintiffs two receivable orders and a rent-receipt, all bearing on their face the name of Michael Higgins. These documents all belonged to his father Michael, with whom he resided. Philip Patrick Higgins was, in fact, an unmarried man, and owned no farms either in the townland of Kilgrovan or elsewhere. There were no other persons of the surname of Higgins in the neighbourhood. As security for the intended loan the plaintiffs required a promissory note, signed by the borrower and his wife, and, accordingly, they were sent a promissory note which purported to be signed by “Michael P. Higgins, farmer, Kilgrovan, Dungarvan, Co. Waterford,” and “Anne Higgins, Kilgrovan, Dungarvan, Co. Waterford,” in the presence of “John Kelly, farmer, Clonea, Dungarvan.” All these signatures were forgeries. On receipt of this forged promissory note the plaintiffs sent, by post, to the address with which they had been corresponding a cheque, drawn on the Newry branch of the Northern Banking Company, Limited, in favour of “Mr. Michael P. Higgins or order,” and crossed generally. Philip Patrick Higgins intercepted the cheque, indorsed it first as “Michael P. Higgins.” and secondly as “Philip P. Higgins,” and cashed it across the counter of the branch of the defendants' bank at Dungarvan.

The defendants' defence was that the payee named in the cheque, namely, “Michael P. Higgins,” was at all material times a non-existing person, and that the cheque pursuant to the provisions of the Bills of Exchange Act, 1882 (45 & 46 Vict. c. 61), might be treated as a cheque payable to bearer; that the cheque was negotiated to the defendants for value, and that the defendants became holders thereof for value and in due course as a cheque payable to bearer; and that the defendants as holders as aforesaid presented the cheque for payment to the Northern Banking Company, Limited, and were paid the amount of such cheque as holders thereof as aforesaid.

The defendants moved for judgment or a new trial on the grounds that the learned judge who tried the action was wrong in law in directing himself that in fact the payee of the cheque was not a fictitious or non-existing person, within the meaning of sect. 7, sub-s. 3, of the Bills of Exchange Act, 1882, and that the finding of fact of the judge was against the evidence and without any evidence to support it.

S. L. Brown K.C. (with him Phelps), for the defendants:—

The payee named in this cheque was a fictitious or non-existing person within the meaning of sect. 7, sub-s. 3, of the Bills of Exchange Act, 1882 (45 & 46 Vict. c. 61), and that being so we were entitled to treat the cheque as a bearer cheque, and, therefore, the crossing of the cheque made no difference as to its negotiability: Smith...