Where one pays to an innocent holder for value a bill or note on which his own name is forged, he is usually denied relief:
Johnston v. Commercial Bank, 1885, 27 W. Va. 343; 55 Am. Rep. 315: Johnson, P. (p. 359): "It seems to us from the review of the authorities, that it is a rule of commercial law too firmly established to be shaken, being sustained by an unbroken line of authorities for more than a century, that the drawee of a bill of exchange is presumed to know the handwriting of the drawer, and a fortiori the maker of a negotiable note is presumed to know his own signature, and if the drawee accepts or pays the bill, or the maker pays the negotiable note, in the hands of a bona fide holder, to which the drawer's or maker's name has been forged, he is bound by the act and cannot recover back the money so paid." 4 may reasonably be lessened by the assertion, that the call itself makes to him in fact, though no assertion may be made in words."
1 See Stephenson v. Mount, 1867, 19 La. Ann. 295; Goddard v. Merchants' Bank, 1850, 4 N. Y. 147; Salt Springs Bank v. Syracuse Savings Inst., 1863, 62 Barb. (N. Y. Sup. Ct.) 101.'
2 1850, 4 N. Y. 147.
3 This case is criticized in Bernheimer v. Marshall, 1858, 2 Minn. 78; 72 Am. Dec. 79.
4 Accord: Mather v. Maidstone, 1856, 18 C. B. 273; Young v. Lehman, 1879, 63 Ala. 519, 523; Tyler v. Bailey, 1873, 71 111. 34, 37; Allen v. Sharpe, 1871, 37 Ind. 67, 73; 10 Am. Rep. 80; Third Nat. Bank v. Allen, 1875, 59 Mo. 310, 315; Jones v. Miners' & Merchants' Bank, 1910, 144 Mo. App. 428; 128 S. W. 829 ; Lewis v. White's Bank, 1882, 27 Hun (N. Y. Sup. Ct.) 396. See Ellis v. Ohio L. Ins. Co., 1885, 4 Ohio St. 628; 64 Am. Dec. 610; Ames, "The Doctrine of Price v. Neal," 4 Harv. Law Rev. 297, 302.
The Supreme Court of Massachusetts, however, has permitted a recovery.1 Upon the principle contended for by Professor Wigmore (ante, Sec. 86) the latter decision is correct, but in any other view, including that which rests the determination of these cases upon the ground of policy, it would seem that the loss must remain with the payor.2