# Cox v. National Bank Clardy

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United States Supreme Court
100 U.S. 704
Cox v. National Bank Clardy
ERROR to the Circuit Court of the United States for the District of Kentucky.
The first of these cases is an action by the National Bank of the State of New York against Merritt Cox, the drawer, J. C. Whitlock, the payee, and W. F. Cox and William Cowan, the two last doing business as partners under the firm name of Cox & Cowan, the acceptors of the following bill:--
'$5,000. HOPKINSVILLE, KY., Aug. 3, 1875.
'Eighty days after date pay to the order of J. C. Whitlock five thousand dollars, value received, and charge to account, renewing a bill for same amount and names, due Aug. 3, 1875.
'MERRITT COX.
'To Messrs. COX & COWAN, New York, N. Y.'
Written across the face of the bill were the words, 'Accepted: Cox & Cowan.'
Whitlock indorsed said bill to E. M. Wright & Co., of New York, who in turn indorsed it to the bank.
The petition of the plaintiff alleges the presentation of the bill in the city of New York for payment, the refusal thereof, and protest and notice to the drawer and indorser.
Cox & Cowan made no defence.
Merritt Cox and Whitlock, however, answered, denying notice of protest, the due and proper presentation of the bill, or the demand of payment.
At the trial, the plaintiff, having read the bill and the protest thereof to the jury, offered evidence tending to show that the notary intrusted with said bill made reasonable and diligent inquiry for the acceptors and their place of business in New York City at the place or places frequented by them when there, and could not, after such inquiry, find them or any place of business of them or either of them; that he then demanded payment on the day of maturity in business hours at the place so frequented by them when in said city, and that payment of said bill was then and there refused; that they caused inquiry to be made by the said notary in New York on the twenty-fifth or twenty-sixth day of October, 1875, of E. M. Wright, a resident of New York City, and one of the firm of E. M. Wright & Co., who indorsed said bill to the bank, as to the post-office address respectively of said Merritt Cox and J. C. Whitlock; that said notary was then informed by said Wright that the post-office address of each of said defendants was Hopkinsville, Ky.; that said notary, on the twenty-sixth day of October, 1875, mailed notices of said protest to each of said defendants at Hopkinsville, Ky. There was no evidence to show that the bank, or any one for it, at any time made any other inquiries for the post-office address of either or both of said defendants.
Cox and Whitlock introduced evidence tending to show that the bill was drawn by Merritt Cox, accepted by Cox & Cowan, and indorsed by Whitlock, all in Hopkinsville, Ky.; and it was there delivered to G. V. Thompson, to whom the bill, of which the one in suit was a renewal, had been sent by E. M. Wright & Co., who had indorsed the same to the bank as collateral security, and had received it after maturity from the bank (the holder) for the purpose of having it renewed; that Thompson sent the bill in suit to said Wright & Co., who immediately delivered it to the bank, and informed it that the bill had been executed and accepted in Kentucky; that at the time of the execution and acceptance of said bill, and at the time of its maturity, the acceptors thereof, W. F. Cox and William Cowan, composing the firm of Cox & Cowan, each resided in Hopkinsville, Christian County, Ky., and had their place of business there, and not elsewhere; that the bank, when it took said bill, and when it was executed and when it matured, was informed and had knowledge that the residence and place of business of Cox & Cowan were at Hopkinsville, Ky., at all the times aforesaid; that there was no presentment for payment of said bill or demand of payment of the same to or upon said acceptors, or either of them, in person or at their residence or place of business in Kentucky on the day of its maturity, or at any time; that there was no agreement to pay said bill in New York except as shown upon its face; that the post-office address of both Merritt Cox and J. C. Whitlock was then, and at all previous times for fifteen years had been, Newstead, Ky., and never at Hopkinsville, and that at all times when the bill in suit or the previous one existed G. V. Thompson, to whom the bill had been sent, resided in Hopkinsville, Ky., and well knew the post-office address of both Cox & Whitlock to be Newstead, Ky., and not Hopkinsville, that mail facilities between Hopkinsville and New York were ample and daily, and that a letter reached one place from the other in three days; that there was telegraphic communication between the two places; that E. M. Wright & Co. were factors and commission merchants in New York, and in that capacity did business for Cox & Cowan, and in the course thereof the bill was received; that each of the firm of Cox & Cowan during the course of said business, and up to June, 1875, on different occasions visited New York on business, and while there wrote and received letters at the office of said Wright & Co., and looked after business intrusted with said factors, and did the like with other factors in their employment in said city.
The plaintiff then introduced evidence tending to show that the original bill was sent to G. V. Thompson by said E. M. Wright & Co., who corresponded with said Thompson in their own names, disclosing no sort of agency for the bank; that he procured the renewal of said bill at their instance and by their instruction, and sent it to them when obtained; that he had no communication with the bank, and was never at any time in any respect its agent, and did not inform it or Wright & Co. of the post-office address of Merritt Cox or Whitlock, and was not inquired of as to either, and afterward had no further connection with the bill.
The court instructed the jury that the bills of exchange were in law payable in the city of New York, notwithstanding the plaintiffs may have known, before making acceptance and indorsement thereof, that the acceptors, Cox & Cowan, actually resided at Hopkinsville; that if the jury believed that the notary made reasonable and diligent inquiry for the acceptors at their place of business in New York, at the place or places frequented by them in that city, and could not after such inquiry find them or their place of business, then the demand of payment during business hours on the day of the maturity of the bill at the place so frequented by them in the city of New York was sufficient; that if the bank did not know the post-office address of the drawer, Merritt Cox, and the indorser, J. C. Whitlock, and if the notary made inquiry as to their several post-office addresses of Wright & Co., who had assigned the bills to the plaintiff, and who were the correspondents of the acceptors, and in the judgment of the notary were likely to be informed as to such post-office addresses, and who professed to know them, and was informed that their post-office office address was Hopkinsville, Ky.; and if the notary transmitted notices on the day after the protest by mail, postpaid. to the drawer and indorsers at the post-office address so ascer tained by the notary, such notice of protest was good to bind the drawer and indorsers respectively.
The defendants excepted to these several instructions, and also made several requests for instructions, each of which was refused.
There was a verdict and judgment for the plaintiff. The defendants, Merritt Cox and Whitlock, then sued out this writ of error.
In the second case the facts are in substance identical with those in the first case, except that J. D. Clardy was the payee and indorser of the bill.
Mr. Walter Evans for the plaintiffs in error.
The fact that the bill of exchange was addressed to Cox & Cowan, New York, N. Y., does not render it at all events payable there, and it was error for the court to so instruct the jury. Rowe v. Young, 2 B. & B. 276; Fenton v. Goundry, 13 East, 468; Chitty, Bills, 151; Lighter v. Will, 2 Watts & S. (Pa.) 140; Fisher v. Evans, 5 Binn. (Pa.) 541.
The acceptors never had a residence or place of business in New York. On the contrary, they lived and did business in Hopkinsville, Ky., where the bill was executed and delivered. Their residence or place of business was not subsequently changed. These facts were known to the bank when it took the bill, and before its date, and when it matured. Hence, in the exercise of the diligence necessary to bind the drawer and indorser, it was absolutely essential that presentment for payment should have been made in Kentucky at the maturity of the bills. Taylor v. Snyder, 3 Denio (N. Y.), 145; Spies v. Gilmore, 1 N. Y. 321; Bank of Orleans v. Whittemore, 12 Gray (Mass.), 469; 1 Parsons, Bills and Notes, 421-425, 441, 453; In re Glyn, 15 Nat. Bank. Reg. 502, 503; Fisher v. Evans, supra; Musson v. Lake, 4 How. 274; Whitesides v. Northern Bank, 10 Bush (Ky.), 502; Barnes v. Vaughan, 6 R. I. 259; Story, Bills, last clause, sect. 325.
While a protest was unnecessary, demand of payment and notice were quite as essential as in case of a foreign bill. Hager v. Boswell, 4 J. J. Marsh. (Ky.) 62.
The address of the drawee on a bill of exchange is nothing more than an intimation of where he is, or of where he resides or does business. It is perhaps prima facie his residence. Rowe v. Young, supra; Fenton v. Goundry, 13 East, 468; Chitty, Bills, 151; Lowry v. Scott, 24 Wend. (N. Y.) 358.
Mr. William D. Shipman and Mr. W. W. Macfarland, contra.
The bills were addressed to the drawees at the city of New York, and were accepted generally. They were therefore payable at that city.
No matter in what part of the world the acceptors may, in fact, have dwelt, they, by accepting a bill addressed to them at New York, elected to reside there for the purpose of its presentation and payment. Smith v. Little, 10 N. H. 526; 1 Am. Lead. Cas. (5th ed.), p. 454; Story, Bills, sect. 353; Chitty, Bills, 172-175, 322, 323, 397.
The duty of the holder is performed when he has made diligent effort to find the acceptor at the place where he has undertaken to pay the bill.
It follows that the charge on this point was right. Story, Bills, sect. 351 and note; 3 Kent, Com. (12th ed.), p. 96 and notes; 1 Parsons, Notes and Bills, p. 440 and note.
The charge of the court below upon the question of notice to the drawer and the indorsers of the bills was clearly within the rule laid down in Lambert v. Ghiselin, 9 How. 256. See also Hunt v. Maybee, 7 N. Y. 266; Story, Bills of Exchange, sects. 299, 308, 351, 387; Carter v. Smith, 9 Cush. (Mass.) 321.
MR. JUSTICE CLIFFORD delivered the opinion of the court.

## Notes

This work is in the public domain in the United States because it is a work of the United States federal government (see 17 U.S.C. 105).
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