Action against the endorser on a promissory note.
The notary public, after the note became due, called at the
house of the endorser who resided in the City of Cincinnati, which
he found shut up and the door locked, and on inquiry of the nearest
resident, he was informed that the endorser and family had left
town on a visit, whether for a day, week, or month he did not know,
nor did he inquire. He made use of no further diligence to
ascertain where the endorser had gone or whether he had left any
person in
town to attend to his business. He left a notice at the house of
a person adjoining, with a request to hand it to the endorser when
he should return.
Held that this was sufficient diligence
on the part of the holders of the note to charge the endorser.
The general rule of law applicable to this subject has long been
settled; that to enable the holder of a bill of exchange or
promissory note to charge the endorser, it is incumbent on him to
prove that timely notice of the dishonor of the bill or of the
nonpayment of the note was given to the endorser, or if this could
not be done, he must excuse the omission by showing that due
diligence had been used to give such notice.
If the parties reside is the same city or town, the endorser
must be personally notified of the dishonor of the bill or note,
either verbally or in writing, or a written notice must be left at
his dwelling house or place of business. Either mode is sufficient,
but one or other must be observed unless it is prevented by the act
of the party entitled to the notice.
If a party to a contract who is entitled to the benefit of a
condition upon the performance of which his responsibility is to
arise dispenses with it or, by any act of his own, prevents the
performance; the opposite party is excused from proving a strict
compliance with the conditions. Thus, if the precedent act is to be
performed at a certain time or place, and a strict performance of
it is prevented by the absence of the party who has a right to
claim it; the law will not permit him to set up the nonperformance
of the condition as a bar to the responsibility which his part of
the contract had imposed upon him.
The holder of a bill or promissory note, in order to entitle
himself to call upon the drawer or endorser, must give notice of
its dishonor to the party whom he means to charge. But if, when the
notice should be given, the party entitled to it should be absent
from the state, and has left no known agent to receive it, if he
abscond, or has no place of residence which reasonable diligence
used by the holder can enable him to discover, the law dispenses
with the necessity of giving regular notice.
Where the parties reside in the same city or town, the notice
should be given at the dwelling house or place of business, and the
duty of the holder does not require him to give the notice at any
other place.
The court refused to hear a reargument upon a point decided in
the case of
Fullerton v. Bank of the
United States, 1 Pet. 612, that the act of the
Legislature of Ohio relative to proceedings against parties to
promissory notes had been well adopted as a rule of practice in the
courts of the United States for the State of Ohio.
Page 27 U. S. 97
This was a writ of error to the Circuit Court of Ohio, in which
court the Bank of the United States has instituted a joint action
under the authority of the Act of Assembly of the State of Ohio
passed 18 February, 1820, entitled "An act to regulate judicial
proceedings where banks and bankers are parties," &c., and by
the provisions of which, the plaintiff may make the drawer and
endorsers of a note or bill of exchange,
joint defendants
in the same action. Thus, the suit was against the defendant and
two others, and the declaration contained a common count for money
lent against all the defendants.
The pleas were nonassumpsit, and on the trial of the cause, two
several promissory notes drawn by J. Embree, endorsed by D. Embree
and Williams the defendant, in blank, were offered in evidence by
the bank. On the subject of notice, the bank then gave the
following parol evidence, which was the only proof offered,
to-wit:
"That the notary public, after the protest of the note and the
expiration of the usual days of grace, called at the house of the
defendant [Williams], who lived in the City of Cincinnati. He found
it shut up and the door locked, and on inquiry of the nearest
resident, he was informed that the defendant and family had left
town on a visit, whether for a day, or week, or month, he did not
know, nor did he inquire. He made use of no further diligence to
ascertain where said Williams had gone or whether he had left any
person in town to attend to his business. The witness left a notice
at the house of a person adjoining, with a
request to
hand it to the defendant, when he should return."
The counsel for Williams submitted to the court whether the
above facts were sufficient evidence of legal notice to charge the
endorser and to entitle the plaintiff to judgment. The court
decided that the evidence offered was conclusive against the
endorser, to which decision a bill of exceptions was tendered and
sealed, and judgment was then rendered for the bank, against
Williams for $12,202.88.
Page 27 U. S. 100
MR. JUSTICE WASHINGTON delivered the opinion of the Court.
This was an action of assumpsit, brought in the Circuit Court of
Ohio by the president, directors, and company of the Bank of the
United States, against J. Embree the maker, and D. Embree and M. T.
Williams, the endorsers of two several promissory notes. The only
count in the declaration is for money lent and advanced by the
plaintiffs to the defendants.
Upon the plea of the general issue, the case at the trial was,
by consent of the parties submitted to the court, and the above
notes were given in evidence by the plaintiffs in support of the
action. The court gave judgment against the defendants and ordered
it to be certified in pursuance of the statute of Ohio that it
appeared to the satisfaction of the court that J. Embree had signed
the notes on which the suit was brought as principal, and D. Embree
and M. T. Williams as sureties.
At the trial of the cause thus submitted to the court, the
plaintiffs having proved the demand, and the handwriting of the
endorsers of the notes, offered the following evidence of the
notice to the defendant Williams,
viz.,
"That the notary public, after the protest of the notes and the
expiration of the usual days of grace, called at the house of the
defendant Williams, who resided in the City of Cincinnati, which he
found shut up, and the door locked, and on inquiry of the nearest
resident, he was informed that the said Williams and family had
left town on a visit, whether for a day, week, or month, he did not
know, nor did he inquire. He made use of no further diligence to
ascertain where Mr. Williams had gone or whether he had left any
person in town to attend to his business. The witness left a notice
at the house of a person adjoining, with a request to hand it to
the defendant when he should return."
The court being of opinion that this evidence was conclusive of
legal notice to charge Williams, his counsel took a
Page 27 U. S. 101
bill of exceptions, and the cause is now for judgment before
this Court upon a writ of error.
The only question which this bill of exception presents is
whether due diligence was used by the defendants in error to give
notice to the endorser of the nonpayment of these notes by the
maker of them?
The general rule of law applicable to the subject has long been
settled; that to enable the holder of a bill of exchange, or
promissory note to charge the endorser, it is incumbent on him to
prove that timely notice of the dishonor of the bill or of the
nonpayment of the note was given to the endorser, or if this could
not be done, he must excuse the omission by showing that due
diligence had been used to give such notice.
If the parties reside in the same city or town, the endorser
must be personally noticed of the dishonor of the bill or note,
either verbally or in writing; or a written notice must be left at
his dwelling house or place of business. Either mode is sufficient,
but one or the other must be observed unless it is prevented by the
act of the party entitled to the notice.
In the case now under consideration, the banking house of the
defendants in error and the dwelling house of the plaintiff were
located in the same city. The notary called at the plaintiff's
house, which he found shut up, and the door locked. Upon inquiry of
the nearest resident, he was informed that the defendant with his
family had left town on a visit, but for how long a period was
unknown to this person; no further attempt was made to ascertain
where the plaintiff in error was gone, or whether he had left any
person in town to attend to his business. The question to be
decided is whether under these circumstances the defendants are
excused for not having given the notice which the law requires.
In the case of
Goldsmith and Bland, Bayley on Bills, p.
224, note, it was decided that it was sufficient to send a verbal
notice to the defendant's counting house, and if no person be there
in the ordinary hours of business to receive it, it is not
necessary to leave or send a written one. The principle
Page 27 U. S. 102
of this decision is that the counting house of the defendant is
the place in which the holder was entitled, during the regular
hours of business, to look for the person for whom the notice was
intended or for some person authorized by him to receive it, and
that the omission to give it was occasioned not by the want of due
diligence in the holder, but by the fault of the party who claimed
a right to receive it.
The principle here stated in not peculiar to this class of
contracts. If a party to a contract who is entitled to the benefit
of a condition upon the performance of which his responsibility is
to arise dispense with or by any act of his own prevent the
performance, the opposite party is excused from proving a strict
compliance with the condition.
Thus, if the precedent act is to be performed at a certain time
or place and a strict performance of it is prevented by the absence
of the party who has a right to claim it, the law will not permit
him to set up the nonperformance of the condition as a bar to the
responsibility which his part of the contract had imposed upon
him.
The application of this general principle of law to the subject
before us, may be illustrated by other cases than the one
immediately under consideration. The holder of a bill or promissory
note, in order to entitle himself to call upon the drawer or
endorser, must give notice of its dishonor to the party whom he
means to charge. But if, when the notice should be given, the party
entitled to it be absent from the state and has left no known agent
to receive it; if he abscond, or has no place of residence which
reasonable diligence used by the holder can enable him to discover;
the law dispenses with the necessity of giving regular notice.
So where the parties, as in this case, reside in the same city
or town, the notice should be given at the dwelling house or place
of business of the party entitled to claim it, and the duty of the
holder does not require of him to give the notice at any other
place. If the giving of the notice at either of these places be
prevented by the act of the party entitled to receive it, the
performance of the condition is excused.
In this case, the notary called at the dwelling house of
Page 27 U. S. 103
the endorser at the regular time and at a seasonable hour, for
aught that appears, to serve the notice and found the house shut
up, the doors locked, and the family absent from town upon a visit
of unknown duration to the agent of the bank or to his informer.
What was he to do? He was not bound to call a second time, nor was
he under any obligation to leave a written notice, even if he could
have found an entrance into the house.
But it is insisted that the defendants in error were bound under
the circumstances of this case to give notice to the plaintiff
through the channel of the post office, and the case of
Ogden
v. Cowley, 2 Johns. 274, is relied upon in support of this
position.
In that case, the notary called at the houses of the endorser
and of his deceased partner for the purpose of giving them notice
of the nonpayment of the note, but found their house locked up, and
on inquiring at the next door, was told that they were gone out of
town. On the same day, the notary put a letter into the post office
in the City of New York, addressed to the defendant and his
partner, informing them of the nonpayment of the note and that they
were looked to for payment. It appeared that at that time the
yellow fever prevailed in the city. The court decided that all
proper steps were taken to communicate the requisite notice to the
endorser, and that the notice was, of course, sufficient.
It may be remarked upon this case that the absence of the
endorsers from their houses was probably the consequence of a
temporary removal from the city on account of the prevailing
sickness, and that the case does not inform us whether the place to
which they had removed was known to the notary. We are not prepared
to say that in such a case the parties entitled to notice were
bound to be at their dwelling houses or to have any person there at
the time the notary called to receive notice, and consequently that
their absence and the closing of their houses ought to have excused
the holder from taking other steps to communicate notice to them.
But laying these circumstances out of the case, the court decided
no more than that the steps taken to give notice were sufficient in
point of law for that purpose,
Page 27 U. S. 104
and it is not to be doubted but that they were so. They do not
decide that in a case freed from the circumstances before noticed,
it was necessary that notice to the endorsers should have been
given through the post office.
In the case of
Crosse v. Smith, 1 Maule & Selw.
545, the cashier called at the counting house of the drawer for the
purpose of giving him notice of the dishonor of the bill. He found
the outward door open, but the inner locked. The cashier knocked
and made noise enough to have been heard if anybody had been
within. After waiting a few minutes, and no person appearing, he
left the house and took no further legal step to give the notice.
It was insisted in opposition to the sufficiency of the notice that
a notice in writing left at the counting house or put into the post
office was necessary. The answer given by the court was that the
law did not require either mode to be pursued. "Putting a letter in
the post," says Lord Ellenborough, "is only one mode of giving
notice; but where both parties are residing in the same post town,
sending a clerk is a more regular and less exceptionable mode." The
decision in this case as to the sufficiency of the notice was the
same as that given in the case of
Goldsmith v. Bland,
before referred to.
The case of
Ireland v. Kip, 10 Johns. 490, and 11
Johns. 231, was much pressed upon the court in the argument of the
present cause by the counsel for the plaintiff in error. We have
examined that case with great attention and respect, but have not
been able to view it in the same light as it seemed to have struck
the learned counsel. The place of residence of the defendant, the
endorser, was three and a half miles from the post office, within
the limits of the City of New York but without the compact part of
the city and without the district of any letter carrier. The case
does not state that the endorser had any counting house or place of
business in the city at which the notice could have been left. The
only notice given to the defendant was a written one, put into the
post office in the City of New York, directed to the defendant, and
stating that the note had not been paid. The place of the
defendant's residence was known to the clerk of the notary, who put
the written notice to the defendant
Page 27 U. S. 105
into the post office. The only question decided by the court was
that, under the circumstances of that case, the holder of the note
was bound to give personal notice to the defendant or to see that
the notice reached his dwelling house, and that merely putting the
notice into the post office was not sufficient.
Upon a second trial of the cause, it appeared in evidence that
the defendant had given directions to the letter carriers of the
post office to leave all letters that came to the post office for
him at a house in Frankfort Street in the City of New York; that
the letter carriers called at the post office three or four times
every day and took out and delivered all letters left there, and
that the defendant usually called or sent every day for his letters
to the house in Frankfort Street.
The learned judge who delivered the opinion of the court stated
that, admitting a service of the notice at the house in Frankfort
Street would have been good and equivalent to a service at the
defendant's dwelling or counting house, still the delivery of the
notice at the post office, unaccompanied with proof that it was
actually delivered at the house, was not notice. He added that
"the invariable rule with us is that when the parties reside in
the same city or place, notice of the dishonor of bills or notes
must be personal, or something tantamount, such as leaving it at
the dwelling house or place of business of the party, if
absent."
Now it is apparent that the question which arises in the case
under consideration was not and could not be decided in the case
just referred to. The objection to the notice in the latter case
was that it ought to have been given at the dwelling house of the
defendant, and could not be given through the post office unless it
also appeared that the notice so given reached the dwelling house
or the house in Frankfort Street. No attempt was made to give the
notice in the former mode, as was done in this case, and the latter
mode, so far from being considered as tantamount to the former or
as being necessary in order to excuse the want of personal notice,
is declared throughout to be insufficient without further
proof.
Page 27 U. S. 106
The opinion of this Court is that the defendants in error were,
under the circumstances of this case, excused from taking any other
steps than they did to give notice to the plaintiff of the
nonpayment of these notes, and that the judgment of the court below
ought to be
Affirmed with costs.
[The counsel for the plaintiff in error stated another point,
which he admitted had been settled by this Court in the case of
Fullerton v. Bank of the
United States, 1 Pet. 612, but requested permission
to reargue the point in case the Court should decide the first
point against him. I am directed by the Court to say that the case
referred to was well considered by the Court; that we are entirely
satisfied with the decision made in it, and see no cause to call
for a reargument of the principle there decided.]
This cause came on to be heard on the transcript of the record
from the Circuit Court of the United States for the District of
Ohio and was argued by counsel, in consideration whereof it is
ordered and adjudged by this Court that the judgment of the said
circuit court in this cause be and the same is hereby affirmed with
costs.
