Case Name: Potheringham against The Executors of Price
Court: South Carolina Court of Common Pleas
Jurisdiction: South Carolina
Decision Date: 1793-01
Citations: 1 Bay 291
Docket Number: 
Parties: Potheringham against The Executors of Price.
Judges: 
Reporter: South Carolina Law Reports
Volume: 1
Pages: 291–294

Head Matter:
Potheringham against The Executors of Price.
Where a pro-inste is made i>v an indorser of a bill of en-change, to ^iienitis r£ of the i-iraim-stance or due diligence not lia\in*; been med' by the primee shall yyj,eí?¿iu uin,¿ drawer at 'J»<? time of drawing, has no effects in tha drawue’s tice or protest ]j?a'ver • ^'fo-that is a fraud. la itself, hut it is otherwise against the ind'jrser-
THIS veas an action of assumpsit upon a bill of ex- , . . change, by the indorsee against the executors of the indorser.
The declaration contained two counts; 1st. A common count by an indorsee against the executors of the indorser, under the law of merchants. 2d. A special count, by L . which he made himself liable by his promise to pay it. ' . , . . r% _» .
1 he circumstances were these : on the 1st ot liZ-% fames Neilson drew the bill in question for five hundred guineas, at sixty days, on Samuel fs5 3-loses Bfyers, in Amsterdam, in favour of William Price, the ‘defendants’ íes-7 ' ^ iator. This bill afterwards came into the hands of the , , , ,. , . , plaintiff, by indorsement; on the the 30th of August, 17 84, it was presented and noted for non-acceptance, but was not protested iov non-payment till the 4th of November, 1785, and returned in February, 17'86« In support of the first count, the bill and protest were produced in the usual form, .... r . , . . And in support or the second count, a witness proved, that upon receiving advice that the bill was refused in November, 1784, he called and gave Price a verbal notice of it, and that a few days after, Price called on him and said that Neilson had directed an attorney to secure the payment out of some bonds he had placed in his hands for recovery. Thai on the 2d of June, 1785, he wrote Price a letter on the subject, and that he then promised payment* That nothing further passed between them respecting it till the bill and protest made their appearance in February, 1736» It came out also from other testimony in the course of the cause, that other bills which Netlson had drawn in the sum mer of 1784, had been returned in the spring of 1786, duly protested, and that he had duly taken them up, particularly one for 600/. to Mr. Blachlock, and another for 1,000/. in favour of Mr, Legare.
For the defendants, it was contended, that the deceased, Price, was never chargeable by the law and custom of merchants, on account of the laches the holder had been guilty of in not returning the bill in due time, when Neilson was solvent, and when he, Price, could have compelled him to give him security for, or paid the amount ; both of which he was prevented from doing, by not receiving the bill and protest, either for non-acceptance or non-payment in due time. That as to the promise to pay, it was made under an impression and idea that every step which the law of merchants made necessary, had been taken by the plaintiff, or his agents ; the laches of the holder being then utterly unknown to him ; and that had he been apprised of that circumstance, he never would have made such a promise j and, therefore, under these circumstances, it was contended his promise was not binding.
For the plaintiff, it was answered, that where a drawer has no funds in the hands of a drawee, there no protest is necessary in an action against the the drawer; because he cannot possibly suffer any damage for want of' protest. 5 Burr. 2670, 2671. Durn. & East, 408. And that the same reason should hold good with regard to an indorser. That at all events, a person may waive a right or benefit which the law gives, and that ought to charge him.
For the defendants, in reply, it was admitted that where a drawer has no funds in the hands of the person on whom he draws, no notice or protest, in an action against him, is necessary, for the reason mentioned; but it is very different in an action against an innocent indorser, who knows Slothing of such circumstance. As to him, therefore, it.is indispensably necessary, that he may be enabled to secure himself from the drawer. That if the protest had come in due time, Price could have compelled Neilson to have paid 1 . . or otherwise secured him. But as it did not, it was optional in Neilson to do it or not, as he thought proper ; and although he promised to give his attorney orders to pay it out of bonds and notes in his hands, he never did it. In the other cases, where the protests were sent out in time, the indorsers were secured and paid ; but, owing to the plaintiff’s neglect, the indorser in this case, was not; for Neilson became insolvent soon after the bill arrived in 1786» That as to the promise made by Price to pay this note, it was void: for it is clear law, that if a person not bound hj taw make a promise, under a concealment of facts, or an ignorance of them, he shall not be bound by it. 1 Durn. Past, 712. 169, 170. In the present case, the bill was not protested for fourteen months after it became due, of all which, Price, the indorser, was totally ignorant. He promised under an idea that all was regular, and that he. was by law chargeable ; and as he was not, such a promise is void.
All the judges were present at this trial, and were unanimously with the defendants on both grounds, to wit, that where a drawer has no effects in a drawee’s hands, no protest as between them, is necessary ; but where an indorser is to be chargeable, it is necessary. In the first case, it is a fraud in the drawer to draw without funds ; he cannot possibly, therefore, be injured: besides, it is a maxim that no man shall take advantage of his own wrong. But with respect to an innocent indorser, he has no' other way to compel a drawer to do him justice, but by having the protest in his possession, to enable him to call regularly on him. It is clear, therefore, that Price was not, on account of this laches, chargeable by the law of merchants. As to the promise, it was evidently made under an idea «bat he was by law liable, when in fact he really was not¿ and that so being made, under an ignorance of the circuit^ stances of this case, it, was in itself void.
Pinckney and Parker, for plaintiff.
Rutledge, for defendants.

Opinion:
Verdict for defendants.