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out of funds which it received after the check | was returned to appellant by the Union Trust was drawn, and with specific directions not to pay them out on that check.

The principle of the cases is that the deposi tor, having a right to the money, may transfer his right to another by drawing a check, and that the bank is bound to recognize this transfer and pay the money to the holder, subject to the contingency that the money which was thus assigned is not otherwise appropriated before the check is presented.

When Knill drew his check his balance was only $98.53, and he therefore had no right to draw a check for $300. The initial step in the transaction was a violation of the contract under which appellant claims the right to re

'cover.

Pabst Brewing Co. v. Reeves, 42 Ill. App.

.154.

The next step was the transfer of the check from Payne to the Gage Hotel Company for value, and without notice of the want, or failure, of consideration between Knill and Payne and of the fact that it was already dishonored. Still no liability had attached to the bank.

Company, and appellant on that day again presented it to appellee, which still had sufficient money to Knill's credit to pay it; but payment was again refused on the ground that it had been stopped by Knill. Thereupon the appellant brought this suit against appellee for the amount of the check. A jury was waived, and the cause tried before the court, resulting in a finding and judgment for appellee. On appeal the judgment was affirmed by the appellate court for the first district, which granted a certificate of importance, and the case has been brought to this court.

There is no dispute as to the material facts as above stated, and the rights of the parties depend upon the question whether appellee was justified in its refusal to pay the check because of the order of Knill that it should not When this check came to appellant's hands, be paid. This question is presented by the payment of it had already been refused be-action of the court in refusing and modifying cause the drawer had not then funds sufficient propositions of law presented at the trial. The to meet it. relation of the banker to the check holder has been frequently considered by this court, and the right of the check holder to payment on presentation of the check, provided there are sufficient funds on deposit to meet it, has been recognized and upheld in every case. This court has constantly held that when the check of a depositor is presented to the banker, if the deposit is sufficient to pay the check, it is an absolute appropriation of the amount of the check to the holder, and that the contract implied by law between the banker and his depositor, for the benefit of whoever may become the holder of a check, is one upon which such holder can maintain an action. A different rule prevails in some other jurisdictions, but this one has been affirmed by many courts and out-leading text-writers as the logical one.

The bank was under no obligation to anyone, either upon the check or because of the check. It could with safety have paid to Knill the small balance standing to his credit. Knill was under no obligation to make further deposits, the bank was under no obligation to receive them, even if tendered.

The bank and Knill, then, were at liberty to deal further with each other or not, as they saw fit, and no limitation on this right was created by the fact that this check was standing.

Richardson v. International Bank, 11 App. 582.

Ill.

While the drawing of the check operates as an assignment pro tanto of the fund, this is so only as between the drawer and the payee; and it has no effect whatever upon the rights of the bank until the check is presented for payment. Bank of Antigo v. Union Trust Co. 50 Ill. App. 434, 149 Ill. 343, 23 L. R. A. 611.

Cartwright, J., delivered the opinion of

the court:

Henry C. Knill was a depositor in the bank of appellee, and on June 21, 1893, drew his check on appellee for $300 payable to the order of Leroy Payne, and delivered it to the payee. Payne on the same day indorsed the check, and delivered it to appellant, who paid him $300 for it. Appellant deposited the check to the credit of its account with its bank, the Union Trust Company of Chicago; and the latter sent it through the clearing house, and it was presented to appellee for payment on June 23. On the day the check was drawn the amount of Knill's deposit was $98.53, but he made subsequent deposits, and when the check was presented he had on deposit with appellee funds in excess of the amount of the check. Appellee refused payment on the ground that Knill had ordered it not to pay the check, and the paying teller marked it, "Payment stopped." On June 24 the dishonered check

The

case of Munn v. Burch, 25 Ill. 35, has been
generally regarded as the leading case in this
country stating the nature of the contract, and
affirming the right of the check holder to sue
and recover from the bank for refusing to
honor a depositor's check under such circum-
stances. In that case, after stating the uni-
versal custom which enters into, and forms a
part of, every contract between a banker and
depositor, it was said (p. 40): "This universal
custom shows us what the contract of all the
parties is. It shows us that the banker, when
he receives the deposit, agrees with the de-
positor to pay it out, on the presentation of his
checks, in such sums as those checks may call
for, and to the person presenting them; and
with the whole world he agrees that whoever
shall become the owner of such check shall,
upon presentation, thereby become the owner,
and entitled to receive the amount called for
by the check, provided the drawer shall at
that time have that amount on deposit.
shall object to that portion of the contract
which the law raises by implication on the
part of the banker to the third person,-to
anybody and to everybody?" And it was
further said: "We hold, then, that the check
of a depositor upon his banker, delivered to
another for value, transfers to that other the
title to so much of the deposit as the check
calls for, which may again be transferred to
another by delivery; and when presented to
the banker, he becomes the holder of the

Who

money to the use of the owner of the check, and is bound to account to him for that amount, providing the party drawing the check has funds to that amount on deposit, subject to his check at the time it is presented. In Fourth Nat. Bank v. City Nat. Bank, 68 Ill. 398, this court said (p. 402): "The universal custom informs us what the contract of all the parties to such transaction is. It informs us that the banker, when he receives the deposit, agrees with the depositor to pay it out, on the presentation of his checks, in such sums as those checks may specify, and to the person presenting them; and with the whole world the banker agrees that whoever shall become the owner of such check shall, upon presentation thereof, become thereby the owner, aud entitled to receive the amount specified in the check, provided the drawer shall at that time have that amount on deposit.' The same doctrine has been affirmed in the following cases: Bickford v. First Nat. Bank, 42 Ill. 238, 89 Am. Dec. 436; Union Nat. Bank v. Oceana County Bank, 80 Ill. 212, 22 Am. Rep. 185; National Bank v. Indiana Bkg. Co. 114 Ill. 483; Metropolitan Nat. Bank v. Jones, 137 Ill. 634, 12 L. R. A. 492; Bank of Antigo v. Union Trust Co. 149 Ill. 343, 23 L. R. A. 611. It is also the rule that the drawer of a check cannot stop payment of it after it has passed into the hands of a bona fide holder. Union Nat. Bank v. Oceana County Bank, 80 Ill. 212, 22 Am. Rep. 185.

These decisions are not controverted by ap pellee, but the argument in its behalf is that, after the check was given, Knill could make an arrangement with appellee that future deposits should not be applied to its payment. When the check was drawn the amount to Knill's credit was not sufficient to pay it, and after Knill had given the order not to pay it the bank received deposits before the presentation which increased his balance to more than the amount of the check. It is insisted that Knill was free to make, and appellee to receive, deposits under an arrangement that this check should not be paid. Of course, if Knill could make such an arrangement on June 21 as to further deposits, he or any other depositor in a bank could make a special contract, when opening an account, that only certain checks should be paid, or at any time limit the liability of the bank by a secret arrangement between himself and the bank as to checks that might be drawn in the future, in any manner that they saw fit. We think such a proposition plainly unsound, and in conflict with the decisions above referred to. If such a special agreement could be made, a person about to take a check could not rely upon the contract implied by the law, but would be compelled to go to the bank and ascertain whether the account had been opened under any special or private arrangement between the banker and depositor, or whether any instructions had been given by the depositor as to what checks should be paid. Even if he should find that there was no agreement or instruction, and should take the check, he could not then rely upon the banker's contract to pay it if the funds were on deposit, since they might be checked out or withdrawn, and a new deposit made under an agreement or instruc

tion that he should not be paid. The basis of the decisions has been that by universal custom there is a contract between the banker and depositor, created by the deposit and receipt of the money, with the whole world, and for the benefit of every person who shall become the holder of a check. If the funds are in the bank when the check is drawn, the drawing is an appropriation, as between the drawer and the payee, of the sum of money named in the check, which is to lie in the bank until called for by a presentation of the check. It is true that in such a case there is no privity between the bank and the check holder until presentment, and that priority in drawing a check does not give priority of right to the fund, as against the banker, but that such priority of right is determined by the order of presentation. In Munn v. Burch, 25 Ill. 35, it was said (p. 40): "Surely every sound lawyer will at once perceive a privity of contract between the banker and the holder of the check, created by the implied promise held out to the world by the banker, on the one side, and the receiving of the check for value, and presenting it, on the other. It is a familiar principle of daily illustration, that a promise made to the public that the performance of a particular act shall entitle the person performing the act to a particular right is a valid assumpsit to such person. The promise on the one hand, and the performance on the other, creates a privity between the parties as intimate and as obligatory as if the promise had originally been made to the particular person.' In 2 Daniel on Negotiable Instruments (§ 1638), the author says: The objection to the check holder's suing the bank, on the ground that there is no privity between him and the bank, seems to us utterly untenable. It is true that there is no privity before the presentment of the check, but by that very act they are brought in privity, and the check holder's right to sue the bank completed. Knill had a right to draw his check in the reasonable expectation that he would have funds at the time of presentment, adequate to meet it, and he did have sufficient funds to his credit at the time of presentment. By giving the check he assumed the obligation that the funds should be there. Of course he might have withdrawn his deposit before presentment, or have declined to make a further deposit to meet the check, and have thus committed a fraud upon appellant; but, if he had done so, it would have been his fraud, and not that of appellee, and appellee would have been in no wise responsible for it. It does not aid appellee that Knill might have committed a fraud in that way, so that appellant is no worse off than it would have been if he alone had committed the fraud. Its duty was to stand indifferent and perform its obligation. When it accepted his account, it did so with an agreement with the whole world that whoever should become the owner of his check should, upon presentation thereof, become the owner and entitled to receive the amount specified in the check,-not as a matter of favor, but as a matter of right,-provided Knill at the time had the amount on deposit. This agreement was for the benefit of such check holder, and we think no special contract could be made to abrogate it, without the consent of

it.

The judgments of the Appellate Court and Circuit Court are reversed, and the cause is remanded to the Circuit Court.

the check holder. Appellant in taking the | ber Asphalt Company is a private corporation, check had a right to rely upon the contract having its principal office in the city of Chiimplied by the law and was entitled to enforce cago; that there were at least five other companies or corporations having offices in the city of Chicago engaged in the business of selling asphaltum procured in the island of Trinidad for street paving, but not procured at Pitch lake, in said island, but which asphaltum was equal, for street-paving purposes, to the asphaltum obtained from said Pitch lake; and that all of said companies and said Barber Asphalt Company were competitors in the business of supplying asphaltum for paving streets in the city of Chicago.

Randolph E. FISHBURN et al., Appts.,

v.

City of CHICAGO.

(171 Ill. 338.)

An ordinance precluding competition for a street-paving contract by requiring the use of asphaltum which can be obtained only from premises owned and controlled by one private corporation is void as against public policy in creating a monopoly, although the ordinance provides that the work shall be awarded to the lowest responsible bidder.

(February 14, 1898.)

PPEAL by defendants from a judgment of A the Circuit Court for Cook County enforcing payment of an assessment for the paving of Gladys avenue.

Reversed.

The facts are stated in the opinion. Messrs. Wilson, Moore, & McIlvaine and Charles D. Richards, for appellants: The provision limiting the material to as phaltum obtained from Pitch lake in the island of Trinidad, is contrary to law, being in restraint of trade, and contrary to public policy. 1 Dill. Mun. Corp. § 362, note 3, p. 544; Dean v. Charlton, 23 Wis. 590, 99 Am. Dec. 205; Nicholson Pavement Co. v. Painter, 35 Cal. 699; Dolan v. New York, 4 Abb. Pr. N. S. 397; Burgess v. Jefferson, 21 La. Ann. 143.

Boggs, J., delivered the opinion of the

court:

This was a petition for judgment confirming a special assessment to defray the expense of improving Gladys avenue, in the city of Chicago. Objections interposed by the appellants were overruled, and judgment entered in ac cordance with the prayer of the petition. This is an appeal to bring the judgment into review

in this court.

The ordinance provides that "the cementing material shall be a paving cement prepared from refined Trinidad asphaltum, obtained from Pitch lake, in the island of Trinidad;" and the objection is, that the effect of this provision is to prevent competition among those desiring to contract to perform such work and furnish the material necessary to complete the improvement. It is conceded this alleged objection does not appear from the face of the ordinance, but appellants offered to produce evidence to show said Pitch lake, in the island of Trinidad, is, and was when the ordinance was passed, the private property, and under the absolute control, of the Barber Asphalt Company; that said Bar

NOTE. For municipal contracts for work or articles which embody a patented invention, see Kilvington v. Superior (Wis.) 18 L. R. A. 45.

It is a well-settled general rule that all contracts, in which the public are interested, which tend to prevent competition, whenever a statute or known rule of law requires competition, are void. Chicago v. Rumpff, 45 Ill. 90, 92 Am. Dec. 196; People, Peabody, v. Chicago Gas Trust Co. 130 Ill. 268, 8 L. R. A. 497; Foss v. Cummings, 149 Ill. 353; 1 Addison, Contr. p. 273; 2 Beach, Modern Law of Contr. § 1108. The statute by the authority of which the city council enacted the ordinance under consideration provides as follows: "All contracts for the making of any public improvement, to be paid for in whole or in part by a special assessment, and any work or other public improvement, when the expense thereof shall exceed $500, shall be let to the lowest responsible bidder, in the manner to be prescribed by ordinance-such contract to be approved by the mayor or president of the board of trustees; provided, however, any such contract may be entered into by the proper officer without advertising for bids, and without such approval, by a vote of two thirds of all the aldermen or trustees elected." 1 Starr & C. Anno. Stat. 1896, chap. 24, p. 777, ¶ 166. The ordinance in question provided the contract to perform the work should be awarded to the lowest responsible bidders. If the requirement that the asphaltum to be used in the improvement should be obtained from Pitch lake, in the island of Trinidad, tended to restrict competition among those who might desire to become bidders for the performance of the work of improving the street, or tended to create a monopoly in favor of anyone having for sale the asphaltum necessary to be used in the work of paving the said street, it would fall under the ban of this general rule of the law, and must be declared inoperative and void. It does not appear from the face of the ordinance that the effect is necessarily to so prevent competition or create a monopoly; but the proffered proof, which the court excluded, unmistakably disclosed that the asphaltum required by the ordinance to be used in making the street was a product which could only be ob tained by purchase from a single corporation. The direct effect of the requirement, therefore, was to create a monopoly in favor of that corporation and to restrict competition in bidding accordingly. The principle under which the rejected evidence under consideration must be, as it is, held by us to be competent, came before this court for discussion in the case of Chicago v. Rumpff and Chicago v. Turner, which cases were consolidated and decided together, and are reported in 45 Ill. 90. The conclusion of the court was that the ordinance then under

rule, they have little application to the case in hand, for the reason the monopoly created under the ordinance under consideration is not in favor of a patented article. The asphaltum offered for sale by the Barber Asphalt Company has no superior legal right in the marterms of the ordinance, nor is it lawful for the ordinance to give it an improper preference; but it should be left to depend upon its merits for any monopoly it may obtain in the good opinion of the public. But it may be said that cities, in the construction of public im

consideration tended necessarily to create a monopoly, and was therefore void; and the doctrine of the case is approved in People, Peabody, v. Chicago Gas Trust Co. 130 Ill. 268, 8 L. R. A. 497, and Foss v. Cummings, 149 Ill. 353. The only cases to which we have been re-kets, and is not entitled to be given any by the ferred which support the view that a city, when providing by ordinance for a public improvement, where the work is to be done and materials to be furnished by the lowest responsible bidder, may, by provisions in the ordinance, restrict the bidders, or provide for the use of an article solely controlled by one per-provements, ought to have, as have individson, are cases where the city desired to use uals in the construction of private structures, some patented article or process covered by the right to select for use the article or subpatent. The supreme courts of Michigan and stance best fitted and adapted to the purpose, of New York (in the former state, by a divided and that to deprive the public of the right to court) entertained the view that an ordinance select and use such superior articles is opposed which provided a contract should be let to the to public policy, and positively disadvantagelowest bidder for the improvement of the street ous to the public. The force of this arguby the use of a designated patented pavement ment must, of course, be admitted; but upon was valid; and the decisions of the supreme reflection it is readily seen it is not necessary court of Kansas in Yarnold v. Lawrence, 15 to foster and create a monopoly, and prevent Kan. 126, is frequently cited as an authority competition in the letting of public contracts, in support of the same view of the question. by providing in ordinances that a certain subIn Yarnold v. Lawrence, 15 Kan. 126, the de- stance or article, and no other, shall be used. cision was rested upon the ground the statute If it be the judgment of the city council that of that state did not require the contract in the most suitable and best material to be used question should be let to the lowest bidder, and in any contemplated improvement is the prodfor that reason that court upheld the ordi- uct of some particular mine or quarry, or some nance, without deciding the question here in-substance or compound which is in the convolved. The supreme court of Wisconsin and trol of some particular firm or corporation, the other states have adopted the view that such ordinance might be so framed as to make such ordinances are void; and Mr. Dillon, after dis-production, substance, or compound the standcussing the question in the first volume of his work on Municipal Corporations (in § 467), says, "The question is close, but there seems, so far, to be a tendency in the courts to adopt the Wisconsin view." In all of the cases where an ordinance has been held valid which provided for the use of some patented article or process, the argument most relied upon by the courts to justify the view the ordinance was valid is that municipal corporations ought not to be denied the right to avail themselves of the advantages arising from the discoveries and inventions of the age, and that when the general government protected a discovery or invention by a patent, which created a monopoly therein, competition in the purchase or use of such patented article or process became impossible, and that the monopoly which it was urged the ordinance tended to create in fact had legal existence entirely independently of the ordinance, and that, therefore, the ordinance did not have any effect to create a monopoly, or prevent competition among bidders. Because of the error of the court in ruling In Mr. Dillon's view, these cases are rather the proffered testimony was inadmissible, the overcome by the current of authority; but, if judgment must be reversed, and the cause rethey should be accepted as stating the correct 'manded. 39 L. R. A.

ard of quality and fitness, and to require that material equal in all respects to it should be employed. An ordinance making it indispensable that an article or substance in the control of but a certain person or corporation shall be used in the construction of a public work must necessarily create a monopoly in favor of such person or corporation, and also limit the persons bidding to those who may be able to make the most advantageous terms with the favored person or corporation. If all the ordinances adopted by the city council of the city of Chicago providing for the paving of streets and public places in the city should select the stock in trade of a particular firm or corporation as the only material to be used in making such street improvements, the evil would be intolerable; and, if they may lawfully select such article in one ordinance, it cannot be unlawful to make it the settled policy of the city that material for paving streets shall be purchased of but one seller.

IOWA SUPREME COURT.

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1. An original package is that package which is delivered by the importer to the carrier at the initial point of shipment, in the exact condition in which it was shipped.

2. The determination of the internal revenue department that a package is a proper and original package for purposes of taxation does not show that it is an original package

of commerce.

and good order among them" (Bowman v. Chicago & N. W. R. Co. 125 U. S. 465, 514, 515, 31 L. ed. 700, 717, 1 Inters. Com. Rep. 823; Leisy v. Hardin, 135 U. S. 114, 34 L. ed. 134, 3 Inters. Com. Rep. 36), by suppressing the manufacture and sale of an "article the use or abuse of which it [the state of Iowa] deemed deleterious" (Leisy v. Hardin, 135 Ú. S. 114, 34 L. ed. 128, 3 Inters. Com. Rep. 36); and that those laws were "fairly adapted to accomplish those objects."

Bowman v. Chicago & N. W. R. Co. 125 U. S. 465, 514, 515, 31 L. ed. 700, 717, 1 Inters. Com. Rep. 823.

And yet that court in passing on these laws, 3. A pine box in which are packed for held that a state cannot, without the consent convenience in shipment packages of of Congress, express or implied, regulate comcigarettes, each of which contains ten cigar-merce between its people and those of other ettes and is sealed with an internal revenue stamp, without any other packing or inclosure around or about them except the box itself, is the origi

nal package of commerce; and when that is opened the packages of cigarettes are subject to the police power of the state as a part of the common mass of property therein.

(January 24, 1898.)

states of the Union, in order to effect its end, however desirable such a regulation might be.

Leisy v. Hardin, 135 U. S. 113, 34 L. ed. 134, 3 Inters. Com. Rep. 36; Wilkerson v. Rahrer (Re Rahrer), 140 U. S. 559, 35 L. ed. 576.

The sealed packages, containing ten cigarettes each, were the "original packages" notwithstanding that, for convenience of shipment, a number of them were put in a wooden

APPEAL by petitioner from an order of the case,

Superior Court of Cedar Rapids County denying a petition for writ of habeas corpus to obtain petitioner's release from custody of the sheriff of Linn County to which he had been committed for violation of the anti-cigarette law. Affirmed.

Statement by Deemer, Ch. J.:

This is a habeas corpus proceeding in which plaintiff and appellant alleged that he was unJawfully restrained of his liberty by defendant, who is sheriff of Linn county, under a warrant of commitment issued by one Rall, a justice of the peace in and for said county, in pursuance of a judgment of conviction for violation of what is familiarly known as the "Anti-Cigarette Law." Plaintiff alleges that his commitment was and is illegal, for the reason that while he sold cigarettes, yet that the same were sold in the “original package" in which imported, and that the law under which he was convicted is unconstitutional in so far as it applies to such sales. The trial court remanded the petitioner, and from the order and judgment so entered he appeals.

Messrs. John M. Redmond and W. W. Fuller, for appellant:

It was admitted by the Supreme Court of the United States that the prohibitory liquor laws "were enacted in the exercise of the police power of the state" (Leisy v. Hardin, 135 U. S. 100, 34 L. ed. 128, 3 Inters. Com. Rep. 36; Wilkerson v. Rahrer (Re Rahrer), 140 U. S. 559, 35 L. ed. 576), "and not at all as regula tions of commerce" (Wilkerson v. Rahrer (Re Rahrer), 140 U. S. 559, 35 L. ed. 576); that they "were enacted solely to protect the health and morals of the people, and to promote peace

United States v. Goldback, 1 Hughes, 529; Ex parte Jervey, 66 Fed. Rep. 957; Bowman v. Chicago & N. W. R. Co. 125 U. S. 465, 31 L. ed. 700, 1 Inters. Com. Rep. 823; Re Beine, 42 Fed. Rep 545; Re Harmon, 43 Fed. Rep. 372.

The very question in issue here has been decided more than once by this court, and it would seem to be unnecessary to fortify the court by the citation of decisions in other jurisdictions, and that the appellant should be able to invoke with confidence and safety the wholesome maxim, Stare decisis.

Collins v. Hilis, 77 Iowa, 181, 3 L. R. A. 110; State v. Coonan, 82 Iowa, 400, 3 Inters. Com. Rep. 670; Hopkins v. Lewis, 84 Iowa, 690, 15 L. R. A. 397; State v. Miller, 86 Iowa, 638.

Identical cases, in all respects, with the case at bar, were the cases of State of Washington v. Coovert, decided by the United States Circuit Judge Hanford in June, 1893.

State v. Goetze, 27 S. E. 225, decided in June, 1896, by the circuit court of West Virginia, was a case where the facts were in every particular identical with the facts in this case.

Mr. Milton Remley, Attorney General, for appellee:

Putting up goods for the convenience of the seller at retail into bundles, papers, bottles, or boxes carries with it nothing of the idea of putting goods in packages for transportation.

A small paper box or bundle or bottle which in that form is unsuitable for shipment but is required to be packed in the same kind of a box, barrel, crate, or bundle for shipment after it is taken out of the package in which it was shipped, is not an original package.

Keith v. State, 91 Ala. 2, 10 L. R. A. 430; State v. Parsons, 124 Mo. 436; Com., Philadel

NOTE.-As to what constitutes an original pack- | Com., Philadelphia County, v. Schollenberger (Pa.) age of commerce, see also State v. Chapman (S. D.) | 22 L. R. A. 155, and Com. v. Paul (Pa.) 30 L. R. A. 10 L. R. A. 432; Keith v. State (Ala.) 10 L. R. A. 430; | 396.

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