
    McCall et al. v. Corning et al.
    The holder of a bill is allowed to profit by an accidental payment, though the drawer's name be forged, when there has been an interval between payment and notice to him of the forgery, and his situation has been altered to his prejudice, either in fact or in legal presumption. The rale that payment by the drawee admits the genuineness of the drawer’s signature, and that the former is thereby legally estopped irom disputing it, is only true in this qualified sense.
    Acceptance of a bill is not an admission of the payee’s signature.
    The holder of a bill, upon which the payee’s endorsement is forged, cannot recover from tho acceptor, whose engagement is to pay according to the tenor of the bill, that is, to tho payee himself, or his genuine order.
    A bondJHe holder of a bill, of which the payee was a fictitious person, ignorant of the fact, may recover against an acceptor who knew that the payee was a fictitious person; but an acceptance, without knowledge by the acceptor of the fictitious character of the payee, is completely void.
    Where the holder of a bill endorses, and presents it for payment to the acceptors, he must be considered as representing, if not as warranting, to the aeceptors, the genuineness of the endorsement of tbe payee, and where the payee's endorsement proves to have been forged, the acceptors, who have paid upon a false representation, however innocent, may recover the amount from the holder; and the holder will have the same remedy against his prior endorser, that the acceptors have against him.
    Where a bill, on which the names of the drawer and payee are proved to be forged, is accepted and paid through error, to an endorsee who acted as agent of a prior endorser, but whoso agency was not disclosed at the time, the amount of the bill hav-ing been paid by the first endorser to the forger; and it is shown that the acceptors, as soon as they ascertained the forger, communicated the fact to the holder, and demanded the return of the money, before the latter had paid it over, which was refused, and the good faith of the acceptors, the holder, and of his principal is admitted, the acceptors will be entitled to recover back the amount so paid in error. C. C. 2279, 2280,2281, 2283.
    APPEAL Appeal from the Fourth District Court of New Orleans, Slrawbridge, J. The facts of this case are stated in the opinion infra.
    
    
      Bradford, for the plaintiffs.
    
      Grymes, for the appellants.
    1st. There was gross negligence on the part of the plaintiffs, the drawees of the bill in question, in paying the same when the signature of the drawer, their customer, was a manifest forgery. 2d. There was gross and unnecessary delay and negligence, in not discovering and communicating the fact of the forgery of the defendants, in time to enable them to preserve their remedy on the bill, against all antecedent parties. 3d: There was no knowledge, negligence or laches, nor any direct or indirect representations, or any other act on the part of the defe'ndants calculated to lead the plaintiffs into error in regard to the payment of -the bill. 4th. These facts amount in law to a complete bar to the plaintiffs action, to recover back the money paid in discharge of the bill. See Story on Bills, (last ed. 1847,) s. 451, and note. 6th Taunt. Rep. 76. 3d Barnes and Cress. 428. 9th Barnes and Cress. 902. 17 Mass. Rep. 1, 33. 13 Seargt. and Rawle, 318. 4 Dali. 234. IstBinney, 27. 10th "Wheaton, 333. Civ. Code, art. 2288. 2 Pardessus, 451. 4 Piar, and Johns. 376. 3d Johns. Cas. 5, 259. 1st Wendell, 433. 6th lb. 445. 6th Cowen, 484.
    
      Halsey, on the same side.
    It is proved that the defendants’ customers, BrittonnnA Co., took the bill from a person recommended to them by the most respectable introduction. It does not appear that either the defendants or Britton and Co. had any acquaintance with the signature of the drawer, or with that of the payees, Pike and Hart; so that they are not at all in fault, for tbe discovery was not in their power, and they had no reason to suspect a forgery-It is proved that plaintiffs are the factors of the drawer; that, when the bill waepresented, they neither had funds of his, nor his crop in their hands; that they had not received the letter of advice, usually preceding his drafts on them; and that the imitation of Conrads signature was so bad, that any one familiar with his signature could easily have discovered the forgery. It is proved that more than a week had elapsed since the payment of the bill, when the forgery was notified to the defendants and the return of the money demanded. The plaintiffs were in fault for not discovering and giving notice of the forgery immediately. And they are without excuse, for their attention was directed to an examination of the bill, by the extraordinary circumstance attending the draft; and with their familiarity with Conrads signature, they would have detected the forgery had they heeded the call for their scrutiny and examined the signa, ture. See the cases of Price and Neal, W. Blaekstone, 390. Cocks, v. Master-man, 9 Barnes and Cress, 902. Smith v. Mercer, 6 Taunton, 76. Levy'!. Bank of the United States, 1 Binney, 29 ; and United States Bank v. Bank of Georgia, 10 Wheaton, 333. '
    1st. It is plain from these cases that the diligence in giving notice after the discovery of the forgery is not sufficient, there must be no delay in the discovery.
    2d. Any prejudice or injury to the holder arising from the delay to give him notice of the forgeiy, releases him from his obligation to return the money. In the earlier cases it was held that the holder ought not to be obliged to refund under any circumstances, although he could not have enforced payment, and although he had immediate notice of the forgery, because the drawee was bound to know the hand-writing of the drawer, and, because the holder, being ignorant of the forgery, ought to have the benefit of the accident of such payment by mistake, and not be compelled to refund. The later decisions have permitted the recovery where the forgery was discovered, and notified on the day of the payment, because the holder “is enabled to proceed against-all the other parties precisely the same as if the payment had not been made, and consequently the payment to him has not in theleastaltered his situation, nor occasioned any delay or prejudice.” Chitty on-Bills, pp. 462, 464. Under the modern doctrine, the holder cannot refuse to return the money, unless he has been injured by the delay to give him notice. Now, it may be said that the parties prior to these defendants are responsible to them without notice, under their guarantee of the genuineness of the bill, and as, in the cases of Cocks v. Mastermann, and Smith v. Mercer, the holder’s recourse on his endorsers had been entirely destroyed bythe-delay, those cases are not conclusive on this, for these defendants have not lost their recourse by the delay. But none of the authorities make the loss of all remedy the only sufficient injury to constitute a defence. When Chitty, in commenting on Smithy. Mercer, remarks that Gibbs, J. was the only judge who put the case on the true ground, viz: the loss of the holder’s recourse, he means the true ground as distinguished from the old doctrine taken by Dallas and Heath, J., the ground of injury by the delay, as distinguished from the doc- ] trine of mere neglect of duty on the part of. the drawee. Chitty means that the only true ground of defence is, an injury from the delay ; he does not mean, that the injury must be, as in that case, the loss of all remedy against the prior parties. For, as we have seen when he gives the reason for which the recovery is allowed where no delay has occurred, he says the holder “is enabled to* proceed against all the other parties precisely the same as if the payment had-not been made, and consequently the payment to him has not in the least altered his situation, nor occasioned any injury or prejudice.” These are Chitty’s expressions, and they imply clearly that if the payment has in the least altered-the-situation of the holder, or occasioned him any delay or prejudice, the drawee cannot recover. Now, if it be true that the defendants have a remedy against all their prior parties, it is also true that by the delay of notice of the forgery they have suffered a delay in the exercise of their remedy, and this, in the expression of Chitty, “any delay or prejudice,” will prevent the drawee’s recovery. The delay is sufficient without evidence of prejudice, for the law will-presume an injury from the delay. “ Proof of actual damage may not always be within the holder’s reach, and, therefore, to confine the remedy to cases of the sort, would fall far short of the actual grievance. The law will, therefore, presume a damage, actual or potential, sufficient to repel any claim against the holder.” Story, J., United, States Bank v. Bank of Georgia, 10 Wheaton, 344.
    If the plaintiffs had not paid the bill it would have been returned immediately to Britton and Co., who might have recovered the amount of their endorser. Non constat but that he could have been made to pay had steps been munedi- 1 ately taken against him, and during the interval of the delay, his situation may have become worse, and perhaps such that suit had become useless. It is no answer that he was a forger, and had probably fled the country even before the draft was paid. It is a rule of commercial law, that it is no excuse for a neglect of notice to a drawer or an endorser, “ that the chance of obtaining anything on their remedy over was hopeless, that the .persons against whom that remedy would apply were insolvent or bankrupt, or had absconded. Parties are entitled to have the chance offered them.” Chitty on Bills, p. 482. It seems clear on principle, that the same delay of notice that would discharge an endorser must release the holder, who has received payment.
    3d. But it is-said that this case differs from all the cases cited; that here is a forgery of the payee’s signature, as well as of thatof the drawer; that for the purpose of this discussion, it must be considered that the bill was a true bill; that the defendants, as well as the plaintiffs, are estopped from denying the signature of the drawer, and, .if it be a true bill, that the title is in Pike and Hart; that, as.in an action againstthe plaintiffs, as acceptors, the defendants could not have recovered for want of title, so, having received the amount without title, they must refund it.
    It is true that in an action on the bill, against the acceptors as such, the proof of title by the endorsement of the payee is essential to a recovery. For though the bill be forged, such an action implies its reality. But is this .implication unavoidable in a action against the acceptor of,a forged bill? Where the fact is that the bill was not drawn by the drawer upon it, is the holder estopped from alleging and proving that fact ? Is he limited to his .action on.the bill, or has he an action on the obligation of the acceptor to hold him harmless from the consequence of the acceptor’s neglect?
    It is said that the holder is estopped from alleging and proving the forgery of the drawer’s name, by his guarantee of the genuineness of the bill; but does the holder make this guarantee to the acceptor, whose duty it is to know the signature of the drawer? Is not the holder’s guarantee to the acceptor, merely of his own title to the bill ? If such be the extent of his guarantee, he is not estopped by it from showing the forgery. Again, the action.of the holder is put by Judge Story on this ground : 11 First, that the drawee, before he accepts, is bound, as a matter of duty, to ascertain whether the signature of the drawer is genuine or not; .and next, that, where.one of two innocent persons must suffer, he who has caused a misplaced confidence, or has misled another, or has omitted his duty, shall suffer rather than the other party.” Story on Bills, § 411. An action not on the bill, but on the obligation flowing from the acceptor’s neglect, does not imply the reality of the bill, and as there is no obligation on the part of the holder to the acceptor estopping the holder from showing the forgery, he must be permitted to prove it. Further, as it is not inconsistent with his guarantee of title to show that the payees on the bill never held it, the holder may prove that fact also. Thus, the holder can show that neither by the drawing in their favor, nor by holding the bill in ignorance of the forgery, have the payees on the bill had any title to it. And after proof of that, there is no need of evidence of a transfer of title ; no need of proving the endorsement of the payees.
    In this case the plaintiffs’ allegations, which they are estopped from denying, are that, the bill was never drawn in favor of the payees upon it; and their evidence, which they cannot controvert, is that, the payees.on it never held it. The plaintiffs have presented the fact that the payees never owned the bill; and if the action were against the plaintiffs as acceptors, they could not require proof of a transfer from the payees. All the cases of refusal of recovery, or of judgment to refund, on the ground of forgery of the payee’s .endorsement, are cases presenting a title in the payees. Hick v. Leverich, 11 La. 573. Canal Bank v. Bank of Albany, 1 -Hill, 287.
    The plaintiffs are responsible to the defendants, from, their neglect in not discovering and giving notice of the forgery. This responsibility .avails the defendants as a grouud of defence, as it would avail them as a ground of action. Their defence is not on the bill, and there is no implication from it of the genuineness of the bill, and of a title in Pike and Hart. The forgery of the bill, and the absence of title in Pike and Hart, are presented by the plaintiffs’ allegations and evidence, and hence, as there is no need of Pike and Hart’s endorsement, the forgery of it is immaterial. In. testing the defendants’ right to retain the money, the counsel for the plaintiffs errs in the premise of his argumenf, the estoppel of the defendants from denying the signature of the drawer. He has assumed this premise, and in doing so he has assumed a point in controversy, whether the holder is limited to an action on the bill, or has his action on the obligation of the acceptor under his neglect.
    The technical ground taken by the plaintiffs’ counsel cannot prevail. Indeed, it is inconsistent with the ground of the plaintiffs’ action, which is, that the money must be returned, not because it belongs to the payees, but because it does not belong to the defendants, as having been paid them in an erroneous belief that the bill had been drawn by the plaintiffs’correspondent. The forgery of the drawer’s signature is the ground of their action.
   The judgment of the court was pronounced by

Seidell, .1.

This is an action to recover from the defendants the amount of a bill of exchange for §¡>2847 50, drawn in the name of F. D. Conrad, upon the plaintiffs, to the order of Messrs. Pike and Hart, endorsed in the name of the payees in blank; also, by L. B. Belgrove, W. A. Britton and Co., and by J. Corning and Co. The bill was at sight, and dated at Baton Rouge, 4 Feb., 1847. It was paid by the plaintiffs to Corning and Co., on the 12th day of Feb., 1847. The signatures of Conrad, and of Pike and Hart, were both forgeries.

It appears that, in 1847, a person calling himself Belgrove, was introduced to Conrad, a planter living in Louisiana, by a letter from Henry Clay; who stated that Belgrove had been introduced to him by Abbott Lawrence, and was desirous to obtain information in relation to the culture of sugar. Relying upon this introduction, Conrad entertained him at his plantation; and, while there, from a conversation between Conrad and a member of the firm of Pike and Hart, Belgrove ascertained that there were some business relations between Conrad and Pike and Hart, and that McCall and Adams were Conrad’s factors. A few days afterwards Belgrove went to Natchez, and there, through a letter of introduction from Mr. Clay, obtained the acquaintance of a gentleman who introduced him to Duncan, a planter living in that vicinity. He stated to this person that, he wished to negotiate a draft on New Orleans, and was accompanied by him to the office of Britton and Co., bankers, at Natchez. Duncan stated to Britton and Co. that Belgrove had brought letters from Henry Clay, and upon iheir enquiring whether the bill was all correct, replied: “I have no doubt it is.” Britton and Co. then cashed the bill, and Belgrove left Natchez a day or two afterwards, and has notsince beenheardof. Britton and Co. endorsed, and have remitted the bill to the defendants, who received it on the 12th February, 1847, and having endorsed it in blank, presented it for payment by their clerk, to Adams, one of the plaintiffs. Ad,ams said he had no advice of it, and asked the clerk to leave it; that he would see his partner, and if it was right, would send a check. At 3 o’clock on the same day, Adams bought a cheek of McCall and Adams for the amount, and stated that Conrad had no authority to draw the draft, his erop not being in hand, and that he would write him a letter censuring him. It does not appear that, in presenting, or receiving payment of the bill, Corning and Co. held themselves out as other than principals. On the 14th February, McCall&nd Adams wrote a letter to Conrad informing him that they had paid the draft. Conrad immediately sent a special messenger to Me Call and Adams, to inform them that he had not drawn such a draft. This messenger reached New Orleans with all possible despatch, and sooner than a letter could have reached the city by mail; and, immediately upon reception of this information, to wit, on the 18th February, the plaintiff communicated it to the defendants, and asked the return of the money, which the defendants declined. The defendants gaye Britton and Co. credit on account for the amount of the draft; and subsequently, after notice of the forgery, paid it over to Britton and Co. The forgery of both names is conclusively established. That of the drawer bore some resemblance, it is proved, to the genuine signature of Conrad, but was a bad imitation. That of the first endorser bore no remblance to to the genuine signature. The good faith of the plaintiffs, of the defendants, and of Britton and Co. is entirely unimpeached. But it is asserted by the defendants in argument, that there was, under the circumstances, gross negligence on the part of the plaintiffs in paying the bill, and that there was also gross and unnecessary delay and negligence in discovering and communicating the fact of the forgery. Upon these charges, we premise that the latter appears entirely untenable; as to the former, there seems to us to have been an over confidence on the part of the plaintiffs, amounting perhaps to imprudence, but not amounting to gross negligence. The indiscretion is much palliated by the consideration that Conrad was not a merchant, but a planter; one of a class not punctual in their advices. As regards the signature of the drawer, it is obvious that their suspicions were not in the least excited on that score; and it is not shown that the relations between him and the plaintiffs had been so intimate and so frequent, as to have given that familiarity with his signature which should have led them to pronounce the draft a forgery.

The question presented by this case is certainly perplexing. In deciding it we are not aided by any conclusive and direct authority, and must seek its solution by the application of general principles and by a consideration of those rules pertinent to the subject, which are peculiar to bills of exchange.

It is perhaps a safe starting point in our investigation to consider what would have been the rights of the plaintiffs, had the forged instrument upon which they made the payment not been a bill of exchange, but one falling within the domain of ordinary rules. Thus let us suppose that Belgrove had forged an order of Conrad upon McCall and Adams, his factors, to deliver to Pike and Hart, or their order, fifty hogsheads of sugar; and had also forged the signature of Pike and Hart to a transfer of the instrument; that he had transferred it to Britton and Co., who, in their turn, had transferred it to Corning and Co., and that Corning and Co., on presentation of the order, had received the sugar-, and that, upon discovery of the forgery, a prompt call had been madeupon Corning and Co. to restore the sugar, and they had refused — could McCall and Adams have recovered its value from them ? The prompt answer to this enquiry would not admit of a doubt. The payment would have been made in error. They would be considered as having made it solely upon the belief, created by the forged order, that they were complying with the request of their principal.

“ He who receives what is not due to him, whether he receives it through error or knowingly, obliges himself to restore it to him from whom he has unduly received it.” “ He who has paid through mistake,” says the Code, “ believing himself a debtor, may reclaim what he has paid.” “ To acquire this right, it is necessary that the .thing paid be not due in any manner, either civilly or naturally. A natural obligation to pay will be sufficient to prevent the recovery.” “That which has been paid in virtue of a void title is also considered as not due.” Civil Code, arts. 2279, 2280, 2281, 2283. Here all the circumstances^ concur which the Lw requires to authorize the relief. Mistake, for McCall and Adams believed the order genuine; an absence of all civil or natural obligation, for their duty was only to Conrad; and a void title, the instrument being forged. The articles we have cited confer a right to recoyer back upon him who has paid,'what was not due, and impose ihe correilative duty on him who has unduly received to restore; and the knowledge or the ignorance, the fraud or the good faith, of the party so unduly receiving, is immaterial. The obligation rests upon that great rule of natural equity, “ Neminem cum alterius detrimento et injuria fieri locupletiorem. It is true that the question is, which of .two innocent parties is to bear the loss; but the Joss had already fallen upon the holders before they presented the forged order; and they could not equitaably ask to shift that loss to another, through that person's mistake. In legal contemplation McCall and Adams would be regarded as never having consented to the delivery of the property; for he does not consent who consents in error.

In the supposed case we hold it to be clear that, upon principles of natural equity,.and under the express rules of law, McCall Sp Adams would be entitled to relief. And if so, it is obvious that they must be relieved in the present case, unless the peculiar nature of the transaction, as growing out of a bill of' •exchange, subjects them to some technical rules which forbids the .application ■of the ordinary standards of justice and legal obligation. We think it was fairly put by the ¡plaintiffs’ counsel that, if the cause is to be withdrawn from tho •operation of general principles and they are subjected to the burden of technical rules, .they are also .entitled to the advantage of such rules.

The rule which is invoked against the plaintiffs is, that payment by the drawee admits the genuineness of the drawer’s signature, and the .drawee is .legally estopped from disputing it. The rule, in a qualified sense, is true. The holder, it seems, is permitted to profit by the accidental payment, though the drawer’s name be forged, when there has been an interval between payment and notice to him of the forgery, and his situation has been altered to his prejudice, either in fact or in legal presumption.

But, on the other hand, acceptance is notan admission of the payee’s signature. Here a technical rule comes in aid of the acceptor. If sued upon his .acceptance, even if .estopped from disputing the signature of the drawer, he has a right to insist upon proof of the payee’s signature. The very rule which .concludes him as to the genuineness of the drawer’s signature and supposes that signature to be genuine, places him in the attitude of one who is really •ordered to pay to the payee named in the bill, or his order. How then can the holder of a bill, upon which the payee’s endorsement is forged, recover from the acceptor, who can be considered only as having admitted the genuineness Tof the drawer’s signature 1 Tested, therefore, by technical rules^it seems to I us it would be im possible to condemn Me Call Sp Adams, were this a suit against ' them upon the bill as acceptors. An acceptance is, an engagement to pay according to the tenor of the hill. But the tenor of the bill was “ pay to Pike <$* Hart, or their order;” and Pike .Sp Hart have never ordered its payment to Corning Sp Co.

But it is said that Pike Sp Hart never had any interest in the bill, and must be regarded as fictitious payees. If they be so regarded, that still would.not authorize a recovery against McCall Sp Adams, had they accepted. For the rule with regard to fictitious payees has only been carried to this extent, that the hona fide holder of such a bill, ignorant of the facts, may recover against an acceptor who knew that the payee was a fictitious person.f The use of such 'names" has been, indeed7highly censureHTFnd an" acceptance, without knowledge by the acceptor of the fictitious character of tlie bill, would, it seems, give no remedy and be completely void. (1 This seems to accord with principle; for the acceptor promises to pay the payee, or his order; and if the payee 1ms no existence, there is no one in whose favor the promise takes effect. Hence it seems to us clear that if this forged bill had been at so many days sight, or after date, and had bean accepted by McCall Sf Adams, Coming <$• Co. could not have recovered on the bill. ,

This view of the case, their having paid a bill which they could not have been compelled by suit to pay, goes very far to show that they ought not to be estopped from recovering it back. But as, perhaps, there may be a question how far the right to resist payment in the one case, and to recover back in the other, are to be treated as identical in principle, we proceed to another view of the rights of the parties, technically considered.

When this bill was presented for payment to McCall Sf Adams by Corning Sf Co., the names of the latter were upon it, and they were endorsers of the bill. Let it be conceded that, according to the technical rule, McCall Sf Adams are to be considered as having admitted the signature of Conrad, and estopped themselves from denying it; was there no legal consequence flowing, on the other hand, from the endorsement of Corning Sf Co., and the presentation of the bill for payment by them 1 We think there was. They are to be considered I as representing at least, if not warranting, to' Ik?c Call Sf Adams, that Pike Hart, the persons named as payees, had negotiated the drafts — that their en- ' dorsement was genuine and true.

The case of The East India Company v. Tritton, 3 Barnwall & Creswell, 82, has been cited as authority that an endorsee does not warrant the genuineness of the prior endorsements. But what is there said cannot be regarded as authority, in the proper sense of the term. The bill had been endorsed by one 'Card, professing to actas attorney of Hope, the payee, but under an insufficient power of attorney. The East India Company accepted the bill, and paid it to the defendants, the' holders, who had taken it from Card's endorsees, and subsequently sued the defendants to recover back the amount which the company had been compelled to-pay a second time to Hope's administrator. It was found by the special verdict that, before the bill was paid, the plaintiffs took all such steps as they judged fit to satisfy themselves that the first endorsement by Card was made by virtue of a sufficient authority. The power was not produced by the defendants, and it did not appear that- they ever saw it, or had any means whatever of forming a judgment as to its'suffieiency. Abbott, C. J. notices the facts as favorable to the defendants, but puts the ease, as with the defendants, upon the ground that they received the money as agents, and paid-over to their principals before any discovery was made of the insufficiency of Card’s authority; that it was unjust to call upon them to restore money no longer in their hands, and which they had not a right to withhold from their principals. Bayley, J. said, he was not prepared to admit that every endorsee warrants the genuineness of the prior endorsements; but added that it was not necessary to decide or discuss that question; that the power was shown to the-plaintiffs, and it was for them to judge of the extent of the authority conferred by it. He then adopts the same ground as the chief justice, that the defendants, having received the money as agents and paid it over, it would be unjust to make them refund. Holroyd, J. thought the plaintiffs, having the means of knowledge in their power, had made a mistake of law, and not of fact, with regard -to the power, and that, under the facts, a promise to repay, if the endorsement proved insufficient, could not be implied. Littledale, J. said, he was not aware that a warranty of the genuineness of endorsements was to be implied, but if there were such an implied warranty in ordinary cases, it was negatived there by the finding of the jury.

Mr. Story, in his Treatise on Bills, very clearly intimates his dissatisfaction with the dicta in the East India Company’s case. In the text he says: ■“ There is yet another engagement which is implied in every endorsement, on the part of the endorser. It is that the instrument which he endorses is a genuine instrument, and not forged; that the signature of the drawer, and also of the antecedent endorsers, are genuine; and that he, the endorser, has a good right to transfer the same to the immediate endorsee.” Story on Bills, § 111. These expressions, it is true, point to the relation of the endorser to his endorsee ; but the reason of the rule, so far at least as the warranty of the payee’s endorsement is concerned, applies with equal force to the acceptor; for if the payee’s endorsement be forged, the holder would be receiving a payment to which he had no right; and there is the same justice in his warranting his title to the acceptor from whom he receives payment, as to the endorsee who gives him the money upon the negotiation of the bill. In a note, Mr. Story comments upon the case of the East India Company, as not supporting the doctrine that the endorser does not warrant the genuiness of antecedent names; and cites the contrary opinion of Pardessus. See also Febrero, vol. 3, p. 350, where it is said: El portador de una letra de cambio es enteramente garante de la validación de ella, y de todos sus endosos. See also Dalloz, 1844, part 2, p. 200. Jousse, Nouveau Commentaire sur les Ordonnances de 1669 and 1673, p. 62. Kent’s Commentaries, edit, of 1844, p. 88.

Whether the endorser may be considered as warranting or not to the acceptor the genuineness of the payee’s name, it is hard to conceive, at all events, how he can be considered otherwise than as representing the payee’s endorsement as genuine. It is certain that, if the title to the bill has not been passed to the holder, he has no right to receive payment; and the presentation for acceptance or payment, is an implied declaration that the title is in him.

The presentment of the bill for payment by Corning 8f Co., being an implied representation by them to McCall Sf Adams, that Pike 8p Hart, the payees named in the bill, had endorsed it, if McCall 8^ Adams are to be held to the technical rule of an implied admission of the drawer’s signature, they must have the benefit of the implied representation; and, having paid upon a false representation, however innocent, the money should be restored to them.

It is not admissible to say that Corning 8f Co.'s endorsement, and the implied obligation which it involved, had no effect upon McCall 8f Adams, in inducing them to pay the bill. The very fact that a house of such respectable standing presented the bill, was a circumstance which probably lessened their vigilance. If the forger, a stranger, had presented the bill, it is not at all improbable that they would have waited for advice.

It is an important feature in this case that the holders were not induced to take the bill by any act of the plaintiffs, and the case is thus relieved from any equity which might be urged, in the case of a forged bill accepted by the drawee, and going after acceptance into the hands of a bond fide holder for value.

It cannot be said that the holder loses his remedy over against his prior endorsers, by the payment of the bill to him by the drawee; if we are right in the doctrine that an endorser is to be considered as representing the genuineness of prior endorsements, then the holder has the same equity against his • prior endorser as the drawee has against him.

The maxim invoked by the defendants, “ In equal: jure melior est conditio possidentis,” is one which cannot be applied in this case, without assuming that the parlies do stand in equal right. But this cannot properly be said; for here the loss had first fallen on Britton 8f Co. without any act or fault whatever of the plaintififs, and if there was some overconfidence or indiscretion on the part of the plaintiffs, it does not appear that the defendants were put in a worse position by the brief delay between the payment and the discovery of tho forgery; and it would be going very far to say that, a simple indiscretion, not shown to have actually made the situation of the defendants, or of Britton ¿j-Co., their principals, worse, should shift the loss from the party upon whom it had first fallen, to a party who paid under an evident mistake of facts, and in good faith.

The defendants had notice of the forgery, and of the plaintiiFs claim upon them, before they paid over the money to Britton Sf Co., and cannot complain that they are treated as principals. We have also seen that on the presentment and receipt of payment they did not disclose their agency.

We have considered the question presented in this cause With care on account of its commercial importance, and have not come to a conclusion without diffidence. The case is embarrassing in consequence of the double forgery of the names of the drawer and payee; and we have not the benefit of authority in point. We are clear that the cause is with the plaintififs upon principles of natural justice, and under the ordinary rules of law; and when technical rules are invoked to break down the equity of a case, they ought to be so clearly applicable and conclusive as to leave no room for doubt.

Judgment affirmed.  