TRIPHONOFF v. SWEENEY et al.

18 March 1913; 65 Or. 299, 130 P. 979; Bean, J.

FACTS
J.W. Sweeney Construction Company drew its check on the US National Bank
of Portland Oregon for USD 2,294.74 payable to the order of DAN
MALCHEFF. The check was drawn and delivered on or about March 25, 1911
but was POSTDATED APRIL 15, 1911.
Malcheff negotiated it to TRIPHONOFF before April 15, 1911 who took it for
value and in good faith. J.W. SWEENEY CONSTRUCTION (the drawer) stopped
payment for the check on the ground that Malcheff (the named payee), an
employee of the drawer, obtained the check by means of false and forged
estimates of work done by him for the drawer. The check was DISHONORED
UPON PRESENTMENT about APRIL 17, 1911.
Triphonoff (INDORSER) sued the drawer J.W. SWEENEY. The latter argued that
Triphonoff should have been put on notice of the infirmity in the instrument or
defect in the tile of MALCHEFF by the fact that the check was POSTDATED.
Counsel for Sweeney goes as far as arguing that a postdated check is not a
negotiable instrument if taken before the date on which demand can be
made for payment but is simply an assignment of rights of the payee and
opens the check to all equities and defenses.
ISSUE
1. Whether or not the check in this case is NOT a negotiable instrument? NO
2. Whether or not postdating of the check amounts to a notice of the infirmity on
the instrument as to disqualify the holder from becoming a HIDC? NO.
RATIO
1. The check is a negotiable instrument. It is full and complete on its face as it
satisfies the requirements of the law for an instrument to be negotiable. It is worthy
to note that the law does not require an instrument to be dated. It is settled that the
instrument is not rendered invalid by its antedating or postdating provided that it is
not done for an illegal or fraudulent purpose.
2. The plaintiff indorsee was not as a matter of law put into inquiry by reason of the
checks being negotiated prior to day of its date. The law itself does not proscribe
postdating of the check. It is noteworthy that the drawing of a postdated check is an
everyday occurrence in the commercial world and the uniform understanding of the
parties is that, when a check is postdated, it is payable on the day it purports to be
drawn even though it be negotiated beforehand