CROSSED CHECKS. The practice of crossing checks originated at the clearing house, the• clerks of the different bankers who did bust ness there having been accustomed to write across the checks the names of their em ployers, so as to enable the clearing house clerks to make up their accounts. It after wards became a common practice to cross checks which were not intended to go through the clearing house, with the name of a banker or with "& Co.," and a custom or usage grew up in regard to this also ; 7 Exch. 389, which held the practice of cross ing checks to be a safeguard to the owner and not to restrict their negotiability.
A check is said to be specially crossed when the name of a bank or banking firm is written across the face of the check (it is then payable only to the bank indicated), and it is said to be generally crossed when the words "and company" or any abbrevia tion thereof, usually "& Co.," between two parallel -transverse lines are written across the check (it must then be paid only to some bank). Another form of the general cross ing is recognized by the later English stat utes which consists merely of two parallel transverse lines across the face of the checks without any words ; Farmers' Bank v. John son, King & Co., 134 .Ga. 486, 68 S. E. 85, 00 L. R. A. (N. S.) 697, 137 Am. St. Rep. 242.
Crossed checks in England are now gov erned by the Bill of Exchange Act of 1882, providing that where a banker in good faith and without negligence receives payment from a customer of a crossed check, and the customer has no title, or a defective title thereto, the banker shall not incur any lia bility to the true owner of the check by rea son only of having received such payment ; [1903] A. C. 240, affirming [1902] 1 K. B. 242 ; [1904] 2 K. B. 465.
The effect of crossing a check with the name of a banker means a direction to the drawee, by the owner, to pay it only through the banker ; disregard of this direction would be evidence of negligence if payment were made to one who was not the lawful owner; 7 Exch. 389. By 19 & 20 Vict. c.
25, this custom was made statutory ; Q. B. Div. 31.
In the United States the system of "cross ed checks," strictly so called, is unknown. But of late the germ of a similar custom has begun to manifest itself. Occasionally checks have stamped or written upon them some form of words which is intended to secure their payment exclusively through the Clearing House.
Where a check was stamped at the time it was drawn with the words "payable through (a named bank) at current rate," it was' held a material part of the direction, and the drawee bank was not required to pay the check when not presented through the bank thus named ; Farmers' Bank v. Johnson, King & Co., 134 Ga. 486, 68 S. E. 85, 30 L. R. A. (N. S.) 697, 137 Am. St. Rep. 242.
There a practice of writing across checks "memorandum," or "mem." They are given thus, not as an ordinary check, but as a memorandum of indebtedness; and be tween the original parties this seems to be their only effect. In the hands of a third party, for value, they have, however, all the force of checks without such word of restric tion ; Franklin Bank v. Freeman, 16 Pick. (Mass.) 535; Dykers v. Bank, 11 Paige (N. Y.) 612 ; Story, Pr. Notes § 499. See IN' DORSEMENT.
Giving a check is not payment unless the check is paid ; Cromwell v. Lovett, 1 Hall (N. Y.) 64; Franklin v. Vanderpool, 1 Hall (N. Y.) 88; L. R. 10 Ex. 153; Small v. Mining Co., 99 Mass. 277; Sweet v. Titus, 4 Hun (N. Y.) 639; Heartt v. Rhodes, 66 Ill. 351; Patton's Adm'rs v. Ash, 7 S. & Ii, (Pa.) 116. But a tender was held good when made by a check contained in a letter, re questing a receipt in return, which the plain tiff sent back, demanding a larger sum, with out objecting to the nature of the tender; and receiving a check marked "good" is pay ment; 2 Dan. Neg. Inst. 559. See PAYMENT.