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What is the significance of the case United States, Petitioner v. National Exchange Bank of Providence in the context of American law

The case of United States, Petitioner v. National Exchange Bank of Providence is significant in the context of American law as it established important precedents in the areas of commercial paper and negotiable instruments. This case involved the United States government seeking to recover payments made at the subtreasury in Boston upon pension checks, the signatures of which were forged. The Supreme Court had to determine whether government pension checks are subject to the general rules of commercial paper as between private parties.

The Court held that they are, and in doing so, it followed the earlier decision of White v. Continental National Bank, which established that government checks are not official warrants but are subject to the same rules as other commercial paper. This decision was a significant development in American law as it clarified the legal status of government checks and their treatment under commercial law. Furthermore, this case also established the principle that a drawee of a check or draft who is also the drawer is held in paying it to a knowledge of the true amount, which has become an important precedent in American commercial law.

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