Walnut Hill Bank, Respondent, v. The National Reserve Bank of the City of New York, Appellant

Walnut Hill Bank, Respondent, v. The National Reserve Bank of the City of New York, Appellant. First Department, January 3, 1913. Estoppel — bills and notes — notice that draft has been credited to account — withdrawal of credit because drawer had no funds — proof necessary to establish estoppel. Where a defendant bank received a draft drawn to its order with instructions to credit the amount to the plaintiff’s account and, having notified the plaintiff that the draft was received for its credit, did not credit it because the drawer lacked funds, the plaintiff in order that the notice may act as an estoppel against the defendant must prove, not only that it sustained damage by reason of the fact that it did not make effort to collect the draft, but also that if it had done so the debt or some part thereof could have been collected. Miller, J., dissented. Appeal by the defendant, The National Reserve Bank of the City of New York, from an order of the Appellate Term of the Supreme Court, entered in the office of the clerk of the county of New York on the 9th day of April, 1912, affirming a judgment of the City Court of the city of New York in favor of the plaintiff, and also (as stated in the notice of appeal) from, a judgment of the City Court entered on the 15th day of April, 1912, upon said order of affirmance. John K. Byard, for the appellant. C. H. Payne, for the respondent. [MAJORITY — Per Curiam:] Per Curiam: This action was brought in the City Court and there have been two trials. Upon the first trial plaintiff had a judgment, which was affirmed by the Appellate Term, and its determination reversed by this court and a new trial ordered (141 App. Div. 475). . The second trial also resulted in a judgment in favor of' the plaintiff, which was affirmed by the Appellate Term (76 Misc. Rep. 220), and the defendant appeals from that determination. The facts are fully, set forth in the opinion delivered on the former appeal, so that it is unnecessary to restate them. It was there said that “ the notice sent by defendant to plaintiff that it had recovered the draft for the latter’s credit, was undoubtedly enough to lay the foundation for an estoppel if it appeared that plaintiff, in reliance upon such notification, had done anything, or refrained from doing anything, to its damage.” On the second trial proof was offered for the purpose of showing that the defendant was estopped from asserting that the draft had not, in fact, been credited to the plaintiff. The testimony of plaintiff’s cashier was taken by commission, and he testified in answer to a question whether the plaintiff refrained from doing anything with respect to the indebtedness of the Merchants and Farmers’ Bank, in consequence of the receipt of the postal card from the defendant to the effect that the draft had been received for its credit, that “ But for the receipt of the card from the- defendant, the plaintiff would have made a strong effort to collect the $1000, now in litigation with the Hational Beserve Bank from the Merchants & Farmers Bank.” It is claimed that this additional proof brings the case within our former decision entitling the plaintiff to recover. This would be so if the plaintiff had proved, in addition, that it sustained damage by reason of its not making the “ effort to collect.” It was bound to prove that it not only did not do anything but if it had the debt or some part of it could have been collected. The determination of the Appellate Term is, therefore, reversed, and a new trial ordered, with costs to appellant to abide event. Present — Ingraham, P. J., McLaughlin, Laughlin, Miller and Dowling, JJ.; Miller, J., dissented. Determination reversed and new ’ trial ordered, costs to appellant to abide event.