The bill for 1000l. they accepted as required, and entered the other in their short bill credit book as follows: "Commercial Banking Company; Maberly; 6th of January; 7601." On that day Maberly stopped payment in London, of the probability of which occurrence the Defendants had apprised the Commercial Banking Company by a letter dispatched from London on the 3d. In answer to this communication, the Commercial Banking Company, on the 6th of January, wrote from Edinburgh to the Defendants as follows:-"We think that you would be entitled to retain the 1000l. contained in our draft of the 30th ultimo as a set-off for the draft for 7601., and of any others which may be sent up to you, and of the bank notes which we or any of our agents may have, and that the one might be offered in exchange for the other. At all events we will trust to your doing your best for us in this matter, and keeping hold of the 1000l. if possible." On the same 6th of January the 760l. bill became due in London; and being dishonored, the Defendants, on the 7th, before the Commercial Banking Company's letter of the 6th came to hand, returned the bill (with a protest for non-payment, and a receipt, as by the Defendants from the Commercial Banking Company, indorsed upon it), in a letter addressed to the Commercial Banking Company at Edinburgh. The Defendants had at that time in their hands sufficient assets of the Company to discharge the bill, and converted the former entry of credit into a debit to the same amount. This was the practice of the two banks with respect to dishonoured bills. On the 9th, the Commercial Banking Company sent back the 7601. bill to the Defendants, saying, in the letter which inclosed it, 66 we return with protest draft upon Maberly 760l., to enable you to carry into effect our views, as stated in our letter of 6th instant." 1833. BELCHER v. LLOYD. On 1833. BELCHER v. LLOYD. On the 12th, the Defendants' acceptance became due; but when the bill was presented, they refused payment, and stated that such refusal was by order of the drawers. The Defendants' books were not produced at the trial; but it was proved that on the 6th of January 1832, and long after, the Defendants, although they held adequate securities, were under large engagements for the Commercial Banking Company; but all the responsibilities which the Defendants were under for the Company in January 1832 were paid off long before the present action, and the cash balance in the hands of the Defendants, due to the Company, was, after January 1832, frequently considerable. A commission of bankrupt was issued against Maberly on the 26th of January 1832. Tindal C. J. left it to the jury to say whether the bill of exchange for 760l. was remitted by the bankers in London to the bankers in Scotland, meaning that the transaction should be closed as between them and the bankers in Scotland. If they thought so, they were to find their verdict for the Plaintiffs. A verdict having been found for the Plaintiffs, Stephen Serjt. moved to set it aside and enter a nonsuit, on the ground that, although the Defendants might have meant to close the transaction as between themselves and the Commercial Banking Company, when they sent back the dishonoured bill for 760l. under protest, on the 7th of Jan. 1832, yet that no such intention was entertained by the Commercial Banking Company, who had on the preceding day, viz. on the 6th of January, written to the Defendants, to explain what their wishes were on that head. On the 6th of January 1832, and long after, the Defendants, although they held adequate securities, were under large engagements for the Commercial Banking Company. The Defendants, therefore, therefore, were remitted to their rights in respect of that bill for 7607. by their having consented to hold it on the terms proposed by the Commercial Banking Company to them in the letter of the 6th of January. At all events, that bill of exchange having been again transferred and remitted by the Commercial Banking Company to the Defendants after it became due, and previously to the commission against Maberly, the Defendants were clearly entitled to set it off against their acceptance for 1000l. upon which this action was brought. A rule nisi having been granted, The finding Wilde and Spankie Serjts. shewed cause. of the jury, that the transaction as between the Defendants and the Commercial Banking Company was closed on the bill being returned to Scotland, is conclusive against the set-off now claimed by the Defendants. When they received the bill a second time, it was not on their own account, but as agents or trustees to do the best for the interests of the Commercial Banking Company; and in that capacity they cannot set it off against a debt due from themselves in their own right. In Fair v. M'Iver (a) third persons holding the acceptance of a trader who was known to be in bad circumstances, agreed with the Defendants, as a mode of recovering the amount of the bill, that it should be indorsed to them, and that they should purchase goods of the trader, which were to be paid for by a bill at three months date, or made equal to cash at three months, (before which time the trader's acceptance would be due), but without communicating to the trader that they were the holders of the acceptance; and it was held, that the trader having become bankrupt, and his assignees having brought assumpsit to recover the value of the goods sold and (a) 16 East, 130. 1833. BELCHER v. LLOYD. delivered 1833. BELCHER v. LLOYD. delivered to the Defendants, the latter could not set-off the bankrupt's acceptance, which they did not hold in their own right, but in effect for other persons. Stephen Serjt. The Defendants' books not having been produced at the trial, there was no evidence that as between the Defendants and the Commercial Banking Company, the affair was closed on the return of the bill to Scotland. But even if it were closed, and the Defendants received the bill the second time in the capacity of trustees for the Commercial Bank, in that capacity they are intitled to set it off against the Plaintiff's demand: for on their so receiving it, the legal title was in them, the Defendants, and courts of law will decide on the rights attaching to the legal title, without recognising incidental trusts. The Defendants, however, on receiving the bill a second time, were remitted to all their former rights, and might exercise their discretion, whether they would hold it on their own account, or as trustees for the Commercial Banking Company. Fair v. M'Iver was a case of fraud, which is not imputed here. TINDAL C. J. Under the circumstances which have been proved in this case, and the finding of the jury, I think the Defendants have no right to set off the 760%. bill. This is an action by the assignees of Maberly, against the Defendants, as acceptors of a bill of exchange for 1000l., drawn on them by the Commercial Banking Company, and due the 12th of January 1832. The Defendants plead that Maberly, at the time of his bankruptcy, was indebted to them in the sum of 760%., and to prove that, they put in a bill of which at one time they were the holders. This bill, indorsed by Maberly to the Commercial Banking Company of Scotland, was transmitted by that firm to the Defendants, towards the discharge of a balance due from the Commercial Banking Company to the Defendants; the bill was dishonored; and the question is, whether the Defendants have received any satisfaction in respect of it. The Plaintiffs undertook to shew that it was satisfied, and I am of opinion they have succeeded. The bill became due on the 6th of January, and being dishonored, was returned to Scotland, not in the usual way, with a demand on the indorser, but as if paid, and accompanied with a receipt. I agree that the receipt might not have concluded the Defendants if they had not had in their hands the means of payment, for one object of the receipt was, to enable the Commercial Banking Company to proceed in the Courts of Scotland against the previous parties to the bill. But when the bill was received by the Defendants, it was entered as a credit in their bill book, as if it had been so much money paid in by the Commercial Banking Company, and upon dishonor of the bill, the Defendants had in their hands sufficient assets of the Commercial Banking Company to cover the failure. Under these circumstances the bill again makes its appearance in Scotland, and again is sent back to the Defendants. For what purpose? That appears by a letter dated the 6th of January, and sent to the Defendants by the Commercial Banking Company, before the bill had arrived in Scotland from London. In that letter, anticipating the dishonor of the bill, the Company express themselves thus: "We think that you would be entitled to retain the 1000l. contained in our draft of the 30th ultimo, as a set-off for the draft for 760%., and for any others which may be sent up to you. At all events, we will trust to your doing your best for us in this matter, and keeping hold of the 1000l. if possible.” The question, then, is whether, after what had taken place, 1833. BELCHER V. LLOYD. |