Page:Federal Reporter, 1st Series, Volume 3.djvu/272

 FIRST NAT. BK. OP CHICAGO ». RENO COUNTT BK. 265 �Smith, 3 How. 763-70. That decision is based upon the case of Commonwealth Bank -v.Bank of New England, 1 How. 234, ■which is the only case referred to in the opinion, and in which case the question was not raised." �If this language does not overrule the doctrine enunciated in Wilson v. Smith, the principle this case clearly establishes, and the long array of cases cited with approbation, and which cannot be ïeconciled with Wilson v. Smith, it seems to me must be held to overthrow that case. That T am not alone in this construction of the Hoover v. Wise Case, I refer to the case of Ilyde v. First Nat. Bank, 1 Biss, 156, and First Nat. Bank of Crown Point y. First Nat. Bank of Bichmond, decided by the supreme court of Indiana, November term, 1878, both of which cases rest upon this construction of the Hoover v. Wise Case. In these cases the several indorsements were restrict- ive indorsements, showing that the paper passed through sev- eral banks for collection, as in the cise at bar, and in the Indiana case the defendant bank had notice of the failure of its correspondent, the Cook County Bank, before collecting and crediting the money. In these cases the Hoover v. Wise Case is cited as establishing the doctrine that no privity of action exists between the first crediter and the last collecting agent. In other words, a collecting agent cannot appoint Bub-agents for the first crediter. The bank from which the defendant received the paper is its principal, and to which it is alone answerable, and by its principal in this case it was ordered to collect for, and credit to the account of, the Mastin Bank. It obeyed that order, and that too before it knew of the failure of the Mastin Bank. It will be seen, by the plaintiff's amended petition in this case, that it sues the Eeno County Bank as its agent, placing its right of action on the ground that the Eeno County Bank collected the money, not for the Mastin Bank, but for the Chicago Bank. Indeed, it could not place its right of action on any other ground, for no one would contend that it could be sued as the drawee of the paper. �I am aware there is a direct oonflict on this question among the state cases, but what I hold is that the Hoover v. Wite ����