This section of the book is from the "Canadian Banking Practice" book, by John T. P. Knight.
Question 276.— The amount of a draft is expressed in words in the body as $150, the figures in the margin being $250, and is collected by a bank from the drawee at the latter amount. Some time afterwards the drawee discovers the mistake. Has he a right to require the bank to repay the $100?
Would the position of the parties be different (1) if the draft had been drawn on an agent of the drawee and he had received the $250, and (2) if the bank which collected the draft merely held it for collection, and not as the owner?
Answer.—The sum denoted by the words would be the amount payable. The payment in excess of $150 would be a payment made by reason of a mistake in fact, and if the bank were not a mere agent in the matter, the $100 would be recovered from the bank by the drawee.
If the bank were an agent, but the agency were not disclosed to the drawee, the same result would appear to follow, unless upon discovering the bank's principal the drawee chose to pursue the principal, instead of the agent.
•If the bank were an agent acting for a disclosed principal, and the money received had been paid over to such principal, then the remedy of the drawee would appear to be against the principal and not against the bank.