*482 "21. The employés of each company while upon the tracks of the other shall be subject to and conform to the rules, regulations, discipline and orders of the owning company." did upon the line of the other road was done | ploying company to report to the other the as a part of their duty to the general em- action taken. ployer; and that, so far as they were subject while upon the tracks of the other company to its rules, regulations, discipline, and orders, this was for the purpose of coördinatIng their movements to the other operations of the owning company, securing the safety of all concerned, and furthering the general object of the agreement between the companies. See Standard Oil Co. v. Anderson, 212 U. S. 215, 226, 29 Sup. Ct. 252, 53 L. Ed. 480. North Carolina R. R. Co. v. Zachary, 232 U. S. 248, 34 Sup. Ct. 305, 58 L. Ed. 591, Ann. Cas. 1914C, 159, is cited, but is not in point, since in that case the relation of the parties was controlled by a dominant rule of local law, to which the agreement here operative has no analogy. The Court of Appeals of Maryland did not err in its disposition of the federal question, and hence its judgment is Affirmed. Mr. Justice CLARKE (dissenting). The Western Maryland Railroad Company owned a line of railroad extending from Hagerstown, Md., to Lurgan, where it connected 481 with the line of the Reading *Company, extending to Rutherford, in Pennsylvania. The two companies entered into a contract by which through freight trains, made up and manned by crews primarily employed by either, should run through over the rails of the other company to Rutherford or Hagerstown, as the case might be. A crew from either line arriving at the terminus of the other should return with a train made up by the company operating the latter-together with any cars which might be "picked up" on the way. Thus, for the purposes of operation, the line over which train crews worked was 81 miles in length, 34 miles of Western Maryland track and 47 miles of Reading track, and the relation of the men to the company, other than the one which originally employed them, while on its line, was defined by the contract quoted from in the opinion of the court. Five of the paragraphs of this contract seem to me decisive of what that relation was, and of this case, viz.: "5. Each company to pay the other an agreed compensation for the service of its engines and crews while on its line. "10. Each company to be responsible and bear all damage and expenses to persons and property caused by all accidents on its road. "17. Each company to have the right to object to, and to enforce objection to, any unsatisfactory employé of the other running upon its lines. "18. All violations of rules or other derelictions by employés of one company while on the road of the other shall be promptly investigated by the owning company and the result reported to the employing company, with or without suggestions for disciplining, the em The deceased brakeman, Hull, was killed miles away from any Western Maryland on the Reading tracks at Harrisburg 30 track, by the alleged negligence of a Readtion of a local Reading yardmaster, in "picking engineer, when engaged, under the direcing up" cars to be added to a train which Rutherford and dispatched by Reading ofwas made up by the Reading Company at ficials from that terminal. ing on the Reading Railroad, subject to the Thus, when he was killed, Hull was workof the Reading Company and at the moment "rules, regulations, discipline and orders" was acting under specific direction of a Reading yardmaster. The Reading Company was paying for the service which he was rendering when he was killed, it had authority to cause his discharge if his service was not satisfactory to it (paragraphs 17 and 18 of the contract, supra), and it had specifically contracted to be responsible for all damage to persons and property caused by accidents on its line growing out of the joint operation. It is admitted that the service he was rendering was in the movement of interstate commerce, but upon the facts thus stated it is concluded in the opinion, that he was not within the scope of the act providing that"Every common carrier by railroad while engaging in commerce between any of the several states * * shall be liable in damages to any person suffering injury while he is employed by such carrier in such commerce, or, in case of the death," etc. 35 Stat. c. 149, § 1, p. 65 (Comp. St. § 8657). * cannot concur in this decision of the court for the reason that the case seems to me to be ruled by a conclusion as to the applicable law, stated in a strongly reasoned opinion in Standard Oil Co. v. Anderson, 212 U. S. 215, 29 Sup. Ct. 252, 53 L. Ed. 480, in this paragraph: "One may be in the general service of another, ⚫483 and, nevertheless, with respect to particular work, may be transferred, with his own consent or acquiescence, to the service of a third person, so that he becomes the servant of that person with all the legal consequences of the new relation." By the contract of hiring Hull was in the general service of the Maryland Company, but "by his consent and acquiescence," he was transferred to the service of the Reading Company whenever his train passed onto its tracks. From that moment until his return to the Maryland Company's tracks again he was engaged exclusively in the work of the Reading Company, that company paid for his services, he was under its "rules, ders of the owning company," was the conregulations, discipline and orders," and it tract between the two companies under had authority to cause his discharge if his which they were operating when Hull was service was not satisfactory. He was under negligently killed. the control of that company as to what he was to do and as to the details of the manner of doing it as completely as if he had no other employer. He ceased for the time being to be the servant of the Maryland Company and became the servant of the Reading Company. 212 U. S. 215, 224, 29 Sup. Ct. 252, 53 L. Ed. 480. (252 U. S. 485) UNITED STATES ▾. CHASE NAT. BANK. (Argued Jan. 14 and 15, 1920. Decided April 19, 1920.) (No. 134.) The federal Employers' Liability Act does not require that a person shall be in the exclusive employ of a railroad common carrier BILLS AND NOTES 434-DRAWEE PAYING It pro in order to come within its scope. We are not dealing here with mere words or with merely "conventional relations," but with very serious realties. Enacted as the to federal Employers' Liability Act was bring the United States law up to the hu#484 manitarian level *of the laws of many of the states, by abolishing the unjust and irritating fellow servant rule, by modifying the often harsh contributory negligence rule, and by otherwise changing the common-law liability of interstate rail carriers to their employés, it should receive a liberal construction to promote its important purpose. Its terms invite the application of the rule, widely applied by other courts and clearly approved by this court, in the case cited, that a man may be in the general service of one, and also, with respect to a part of his service to particular work-be in the service of another employer, so that he becomes for the time being the servant of the latter "with all the legal consequences of that relation." The line of demarcation could not be more clearly drawn than it was in this case, and the rule seems to me to be sharply and decisively applicable. In the opinion of the court it is said: "It is clear that each company retained control of its own train crews.' Upon the contrary, it seems to me, it is clear that neither company retained any control whatever over the crews primarily employed by it while they were on the line of the other company. "21. The employés of each company, while upon the tracks of the other, shall be subject to and conform to the rules, regulations, discipline and or FORGED DRAFT NOT ENTITLED TO RECOVER Where the United States paid a forged draft purporting to have been drawn on the United States Treasurer by an acting quartermaster in the army to his own order to a bank to which it had been indorsed, it could not recover the amount as paid under a mistake of fact, as the drawee is bound to know the drawer's signature, and the fact that the acting quartermaster's indorsement of the draft was also forged did not change the rule. Mr. Justice Clarke dissenting. In Error to the United States Circuit Court of Appeals for the Second Circuit. Action by the United States against the Chase National Bank. A judgment for defendant on a directed verdict (241 Fed. 535) was affirmed by the Circuit Court of Appeals for the Second Circuit (250 Fed. 105, 162 C. C. A. 277), and plaintiff brings error. firmed. Af Mr. Assistant Attorney General Spellacy, for the United States. Messrs. Henry Root Stern and Charles E. Rushmore, both of New York City, for defendant in error. ⚫490 *Mr. Justice McREYNOLDS delivered the opinion of the Court. Plaintiff in error sued the defendant bank, at law, to recover money paid out under mistake of fact. The complaint alleged: "First. That at all the times hereinafter men tioned, the plaintiff was and is a corporation sovereign, and the defendant was and is an association organized for and transacting the business of banking in the city, state, and Southern District of New York, under and pursuant to the provisions of the acts of Congress in such case made and provided; "Second. That on or about the 18th day of December, 1914, the defendant presented to the Treasurer of the United States at Washington, D. C., for payment, a draft in the sum of $3,571.47, drawn on the Treasurer of the United States, payable to the order of E. V. Sumner, 2d Lt., 2d Cav., A. Q. M., and purporting to be drawn by E. V. Sumner, Acting Quartermaster, U. S. A., and to be endorsed by E. V. Sumner, For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes "Third. That at the date of the presentation of said draft by the defendant to the Treasurer of the United States, the defendant was a depository of the funds of the United States of America, and payment of said draft to the defendant was thereupon made by the plaintiff, by passing a credit for the amount of said draft to the defendant upon the accounts of the defendant, as depository for the funds of the plaintiff ; "Fourth. That the name of said E. V. Sumner, 2d Lt., 2d Cav., A. Q. M., indorsed upon the back of said draft, was forged and had been wrongfully and fraudulently written upon the same by a person other than the said E. V. Sumner, without his knowledge or consent, and no part of the proceeds of said draft were ever received by him; "Fifth. That the payment of said draft made by the plaintiff to the defendant, as described in paragraph three of this complaint, was made under a mistake of fact and without knowledge that the signature of the said E. V. Sumner, 2d Lt., 2d Cav., A. Q. M., payee thereof, had been forged upon the back of said draft; "Sixth. That the plaintiff has duly requested the defendant to repay to it the amount of said draft, to wit, $3,571.47, but the defendant has failed and refused to pay the same or any part thereof to the plaintiff. "Wherefore, the plaintiff demands judgment against the defendant in the sum of $3,571.47, with interest thereon from the 18th day of December, 1914, together with the costs and disbursements of this action." January 27, 1913. This check must be indorsed on the line below by the person in whose favor it is drawn, and the name must be spelled exactly the same as it is on the face of the check. If indorsement is made by mark (X) it must be witnessed by two persons who can write, giving their place of residence in full. E. V. Sumner, (Sign on this line) 2d Lt., 2 Cav., AQM. Pay Chase National Bank New York, or order. Restrictive indorsements guaranteed. Howard Nat'l Bank, 58-3 Burlington, Vt. 58-3, M. T. Rutter, Cashier. Received payment from the Treasurer of the Unit The bank denied liability and among other things claimed that the same person wrote the name E. V. Sumner upon the draft both as drawer and indorser. The facts were stipulated. It appears: Lieutenant Sumner, quartermaster and disbursing officer at Ft. Ethan Allen, near Burlington, Vt., had authority to draw on the United States Treasurer. Sergeant Howard was his finance clerk and so *493 That bank im *known at the Howard National Bank of Burlington. Utilizing the official blank form, Howard manufactured in toto the draft in question-Exhibit A. Having forged Lieutenant Sumner's name both as drawer and indorser, he cashed the instrument over the counter at the Howard National Bank without adding his own name. mediately indorsed and forwarded it for collection and credit to the defendant at New York City; the latter promptly presented it to the drawee (the Treasurer), received payment and credited the proceeds as directed. Two weeks thereafter the Treasurer discovered the forgery and at once demanded repayment which was refused. Before discovery of the forgery the Howard National Bank withdrew from the Chase National Bank sums aggregating more than its total balance immediately after such proceeds were credited; but additional subsequent credit items had maintained its balance continuously above the amount of the draft. Both sides asked for an instructed verdict The trial court directed one without more. for the defendant (241 Fed. 535) and judgment thereon was affirmed by the Circuit Court of Appeals (250 Fed. 105, 162 C. C. A. 277). If important, the record discloses substantial evidence to support the finding necessarily involved that no actual negligence or bad faith, attributable to defendant, contributed to success of the forgery. Williams v. Vreeland, 250 U. S. 295, 298, 39 Sup. Ct. 438, 63 L. Ed. 989, 3 A. L. R. 1038. The complaint placed the demand for recovery solely upon the forged indorsementneither negligence nor bad faith is set up. If the draft had been a valid instrument with a good title thereto in some other than the collecting bank, nothing else appearing, the drawee might recover as for money paid under mistake. Hortsman v. Henshaw, 11 How. 177, 183, 13 L. Ed. 653. But here the whole instrument was forged, never valid, and nobody had better right to it than the collecting bank. *494 *Price v. Neal (1762) 3 Burrows, 1354, 1357, held that it is incumbent on the drawee to know the drawer's hand and that if the former pay a draft upon the latter's forged name to an innocent holder not chargeable with fault there can be no recovery. "The ed States Dec. 16, 1914. 1-74 The Chase National plaintiff cannot recover the money unless it Bank 1-74 of the City of New York. be against conscience in the defendant to re (40 Sup.Ct.) tain it." "But it can never be thought unconscientious in the defendant to retain this money when he has once received it upon a bill of exchange indorsed to him for a fair and valuable consideration which he had bona fide paid without the least privity or suspicion of any forgery." And the doctrine so announced has been approved and adopted by this court. Bank of United States v. Bank of Georgia, 10 Wheat. 333, 348, 6 L. Ed. 334; Hoffman v. Bank of Milwaukee, 12 Wall. 181, 192, 20 L. Ed. 366; Leather Mfgs. Bank v. Morgan, 117 U. S. 96, 109, 6 Sup. Ct. 657, 29 L. Ed. 811; United States V. Natl. Exch. Bank, 214 U. S. 302, 311, 29 Sup. Ct. 665, 53 L. Ed. 1006, 16 Ann. Cas. 1184. In Bank of United States v. Bank of Georgia, through Mr. Justice Story, this court said concerning Price v. Neal: "There were two bills of exchange, which had been paid by the drawee, the drawer's handwriting being a forgery; one of these bills had been paid, when it became due, without acceptance; the other was duly accepted, and paid at maturity. Upon discovery of the fraud, the drawee brought an action against the holder to recover back the money so paid, both parties being admitted to be equally innocent. Lord Mansfield, after adverting to the nature of the action, which was for money had and received, in which no recovery could be had, unless it be against conscience for the defendant to retain any fault or negligence in any one, it certainly was in the plaintiff, and not in the defendant.' The whole reasoning of this case applies with full force to that now before the court. In regard to the first bill, there was no new credit possession of it before the time it was paid or given by any acceptance, and the holder was in acknowledged. So that there is no pretense to allege, that there is any legal distinction between the case of a holder before or after the acceptance. Both were treated in this judgment as being in the same predicament, and entitled to the same equities. The case of Price v. Neal the subsequent decisions in which it has been has never since been departed from; and, in all cited, it has had the uniform support of the court, and has been deemed a satisfactory authority." Does the mere fact that the name of Lieutenant Sumner was forged as indorser as well as drawer prevent application here of the established rule? We think not. In order to recover plaintiff must show that the defendant cannot retain the money with good 496 conscience. Both are *innocent of intentional fault. The drawee failed to detect the forged signature of the drawer. The forged indorsement puts him in no worse position than he would occupy if that were genuine. He cannot be called upon to pay again and the collecting bank has not received the proceeds of it, and that it could not be affirmed that it was an instrument to which another held a better unconscientious for the defendant to retain it, title. The equities of the drawee who has he having paid a fair and valuable consideration paid are not superior to those of the innocent for the bills, said 'here was no fraud, no wrong. collecting bank who had full right to act upIt was incumbent upon the plaintiff to be satis on the assumption that the former knew the fied that the bill drawn upon him was the draw-drawer's signature or at least took the risk er's hand, before he accepted or paid it; but of a mistake concerning it. Bank of Eng *495 it was not incumbent upon the defendant to inquire into it. There was a notice given by the defendant to the plaintiff, of a bill drawn upon him, and he sends his servant to pay it, and take it up; the other bill he actually accepts, after which, the defendant, innocently and bona fide, discounts it. The plaintiff lies by for a considerable time after he has paid these bills, and then found out that they were forged. He made no objection to them at the time of paying them. Whatever neglect there was, was on his side. The defendant had actual encouragement from the plaintiff for negotiating the second bill, from the plaintiff's having, without any scruple or hesitation, paid the first; and he paid the whole value bona fide. It is a misfortune which has happened without the defendant's fault or neglect. If there was no neglect in the plaintiff, yet there is no reason to throw off the loss from one innocent man upon another innocent man. But, in this case, if there was land v. Vagliano Bros., [1891] L. R. App. Cases, 107; Dedham Bank v. Everett Bank, 177 Mass. 392, 395, 59 N. E. 62, 83 Am. St. Rep. 286; Deposit Bank v. Fayette Bank, 90 Ky. 10, 13 S. W. 339, 7 L. R. A. 849; National Park Bank v. Fourth National Bank, 46 N. Y. 77, 80, 7 Am. Rep. 310; Howard v. Bank, 28 La. Ann. 727, 26 Am. Rep. 105; First National Bank v. State Bank, 107 Iowa, 327, 77 N. W. 1045, 44 L. R. A. 131; Bank v. Trust Co., 168 N. C. 606, 85 S. E. 5, L. R. A. 1915D, 1138; 4 Harvard Law Review, 297, article by Prof. Ames. And see Cooke v. United States, 91 U. S. 389, 396, 23 L. Ed. 237. The judgment of the court below is Affirmed. Mr. Justice CLARKE dissents. UNITED STATES v. SIMPSON. (252 U. S. 465) The introduction could be effected only through transportation, and whether this (Submitted March 5, 1920. Decided April 19, took one form or another it was transporta 1920.) No. 444. INTOXICATING LIQUORS 138-INTERSTATE USE BY HIS OWN AUTOMOBILE FORBIDDEN BY STATUTE. Act March 3, 1917, § 5 (Comp. St. 1918, Comp. St. Ann. Supp. 1919, § 8739a), prohibiting the transportation of intoxicating liquors in interstate commerce, except for specified purposes, into any state where the manufacture or sale of such liquors for beverage purposes is punishable, applies to the interstate transportation of liquor by its owner in his own automobile and for his own personal use. Mr. Justice Clarke, dissenting. In Error to the District Court of the United States for the District of Colorado. Everett L. Simpson was indicted for an offense, and a demurrer to the indictment was sustained (257 Fed. 860), and the United States brings error. Reversed. tion in interstate commerce. Kelley V. Rhoads, 188 U. S. 1, 23 Sup. Ct. 259, 47 L. Ed. 359; United States v. Chavez, 228 U. S. 525, 532, 533, 33 Sup. Ct. 595, 57 L. Ed. 950; United States v. Mesa, 228 U. S. 533, 33 Sup. Ct. 597, 57 L. Ed. 953; Pipe Line Cases, 23+ U. S. 548, 560, 34 Sup. Ct. 956, 58 L. Ed. 1459; United States v. Hill, 248 U. S. 420, 39 Sup. Ct. 143, 63 L. Ed. 337. The statute makes no distinction between different modes of transportation and we think it was in 467 tended to include them all, that being the natural import of its words. Had Congress intended to confine it to transportation by railroads and other common carriers it well may be assumed that other words appropriate to the expression of that intention would have been used. And it also may be assumed that Congress foresaw that if the statute were thus confined it could be so readily and extensively evaded by the use of automobiles, would not be of much practical benefit. See autotrucks and other private vehicles that it Kirmeyer v. Kansas, 236 U. S. 568, 35 Sup. Ct. Mr. Assistant Attorney General Frierson, 419, 59 L. Ed. 721. At all events we perfor the United States. ceive no reason for rejecting the natural import of its words and holdings that it was confined to transportation for hire or by public carriers. The published decisions show that a number of the federal courts have regarded the statute as embracing transportation by automobile, and have applied it in cases where the transportation was personal and private, as here. Ex parte Westbrook (D. C.) 250 Fed. 636; Malcolm v. United States, 256 Fed. 363, 167 C. C. A. 533; Jones v. United States (C. C. A.) 259 Fed. 104; Berryman v. United States (C. C. A.) 259 Fed. 208. That the liquor was intended for the personal use of the person transporting it is not material, so long as it was not for any of the purposes specially excepted. This was settled in United States v. Hill, supra. We conclude that the District Court erred in construing the statute and sustaining the demurrer. And the question for decision is whether the statute was applicable where the liquor -five quarts of whisky-was transported by its owner in his own automobile and was for his personal use and not for an excepted purpose. The District Court answered the ques- Mr. Justice CLARKE (dissenting.) The intion in the negative and on that ground sus-dictment in this case charges that the detained a demurrer to the third count, which is all that is here in question and discharged the accused. 257 Fed. 860. We think the question should have been answered the other way. The evil against which the statute was directed was the introduction of intoxicating liquor into a prohibition state from another state for purposes other than those specially excepted-a matter which Congress could and the states I could not control. Danciger v. Cooley, 248 U. S. 319, 323, 39 Sup. Ct. 119, 63 L. Ed. 266. Judgment reversed. fendant, being in the City of Cheyenne, Wy oming, "bought, paid for and owned" five quarts of whisky and thereafter, in his own automobile, driven by himself, transported it into the City of Denver, Colorado, intending to there devote it to his own personal 468 use. Colorado prohibited the manu*facture and sale therein of intoxicating liquor for beverage purposes. The court decides that this liquor was unlawfully "transported in interstate commerce," from Wyoming into Colo For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes |