CLAIM FOR PAYMENT OF CHEQUE.

Manawatu Herald, Volume XLV, Issue 2597, 23 June 1923, Page 3

CLAIM FOR PAYMENT OF CHEQUE.

A FINE BANKING POINT. NATIONAL BANK V. JOHN GOLDER, At yesterday’s sitting of the loco 1 S.M. Court, before Mr J. L. Stout, S.M., the National Bank of N.Z. (Mr Cooke) proceeded against John Golder (Mr Bergin) for the recovery of the amount of a cheque, £23, and interest to date, drawn in favour of “Joe Avery or order,” crossed “bank” and subsequently paid by Avery into his current account at the National Bank of N.Z. at Auckland. The evidence for the National Bank was taken at Auckland on the 11th inst. and set out that the cheque was paid into Avery’s account on the Bth December, 1922. It was then endorsed “J. J. Avery.” It was returned from the Bank of N.Z. at Foxton (defendant’s bank) on December 13th, marked “payment stopped, endorsement irregular.” On the 14th December Avery interviewed the manager of the National Bank at Auckland and the cheque was then further endorsed “Joe Avery.” It was again returned from the defendant’s bank, at Foxton, with the answer “payment stopped.” The National Bank admitted ti'liat although the cheque was payable to “Joe Avery or order” it was endorsed “J. J. Avery” and credited to the account of “J. J. Avery” in their books. On the 13 tli December, before the cheque was first returned from defendant’s bank, the plaintiff allowed Averv to draw cheques on them to the extent of £9 10s 9d against Golder’s cheque. Avery denied to his bankers that there was any reason to justify Golder stopping payment. The plaintiff wrote to Golder asking him to release payment of the cheque, which bad ns i been done.

(■'■wise! on behalf of plaintiff bank submitted that the plaintiff was a. bolder for value and a “holder in due course” and as such, had ..a absolute right to recover against fpddmv tlie drawer of the cheque as th'ov had not received notice of any defect in Avery’s title to the cheque when they took it and advanced against it. He quoted from the “Bills of Exchange Act,” in support of his contention. Mr Bergin, for the defendant, submitted that there were two points in his favour, first that as the cheque was crossed generally and payable to “Joe Avery or order” and when the plaintiff took it and endorsed only “J. J. Avery” and credited to the account of “J. J. Avery,” and there being no evidence before the Court to show that “Joe Avery” and “J. J. Avery” were the same person, the defendant was entitled to a non-suit. Secondly. to be a holder in due course. I lie Act provides, that the holder must take the cheque “complete and regular on the face of it,' and as the cheque in question was improperly endorsed when the plaintiff took it, they were not “holders in due course.” therefore they could be met with any defence which the defendant could have set up against Averv.

John Colder, defendant, gave evidence relating to the transactions between himself and ‘‘Joe Avery” whom he knew by no other name. An agreement to mortgage was executed by them and Colder was to advance Avery certain moneys when Avery forwarded certain documents. These documents never came but Avery wrote stating that the arrangements did not suit him. Colder received that letter on December 4th and immediately wired Avery that he was stopping payment of the cheque. On the sth December, he stopped payment of the cheque and telegraphed Avery to that effect. He wrote Avery on the oth December but he had neither seen nor heard from Avery since. About a fortnight later lie received a letter from the National Bank asking him to release payment, which he refused to do.

Counsel for plaintiff submitted an English authority to show that when the name of a payee of a cheque was mis-spelt, il was correctly endorsed by the payee signing his correct name.

The S.M. reserved decision