Case Name: President and Directors of the Company of the Bank of North America against Peter Barriere
Court: Supreme Court of Pennsylvania
Jurisdiction: Pennsylvania
Decision Date: 1794-04
Citations: 1 Yeates 360
Docket Number: 
Parties: *President and Directors of the Company of the Bank of North America against Peter Barriere.
Judges: 
Reporter: Reports of cases adjudged in the Supreme Court of Pennsylvania (Yeates)
Volume: 1
Pages: 359–363

Head Matter:
*President and Directors of the Company of the Bank of North America against Peter Barriere.
Wken a promissory note lias been indorsed, after it became due, it amounts to an original undertaking, as a note newly drawn by the indorser.
This cause was tried at the last January term, when a verdict was agreed to be taken for the plaintiffs for 1560I. the principal and interest appearing due on the face of a promissory note, subject to the opinion of the court on the following case.
On the 25th November 1784, John M’Cree, as servant of Haym Soloman, and duly impowered for that purpose, drew a promissory note for 2600 dollars, payable in 45 days, to Don Francisco Rendon or order, which Rendon indorsed in blank, and received the amount from the plaintiffs, deducting the discount. The note, which became due on the 9th January 1785, was dishonoured by Soloman, and due demand was made of him and notice thereof duly given tq Rendon, the indorser. It was afterwards protested on the 13th of January following.
Rendon, the payee of the note, being about to leave the continent of America and sail for' Europe, came to the bank of North America, accompanied by the defendant, on the 2d December 1786, when the cashier of the bank produced to them the note, and an account of the sum due thereon. Both Rendon and the defendant approved of the same, and the defendant indorsed his name on the note, to give it credit. No demand was made on Soloman in his life time, or on his administrators after his decease, subsequent to the time of the defendant’s indorsement; nor was any notice given to Rendon or the defendant of non-payment, subsequent to such indorsement, until some short time before the action brought.
If on these facts, the opinion of the court should be in favour of the plaintiffs, it was agreed, that the sum due to the plaintiffs should be ascertained by reference or an issue; if in favour of the defendant, then the verdict was to be set aside and judgment entered for the defendant.
The case was now argued by Messrs. Du Ponceau and Thomas for the defendant, and by Messrs. Lewis and Tilgh-man for the plaintiffs.
On the part of the defendant, it was said, that the plaintiffs had not founded their suit on a collateral contract, but had charged the defendant as an indorser, on general legal principles. The declaration states two counts. 1st, that Soloman drew the note through the instrumentality of M’ Cree, payable to Rendon *or order, on 25th November 1784, that r*ggi Rendon on the same day indorsed it to the defendant, >- who on the same day indorsed it to the plaintiffs: that on the 13th January 1785, demand was made of Soloman, who refused payment, and notice thereof .was afterwards given to the defendant, who in consequence thereof becoming changeable, promised to pay, &c. 2d, that Soloman on the 25th November 1784, drew the note payable to Rendon or order, that Rendon on the same day indorsed it to the defendant, who on the 2d December 1786 indorsed it to the plaintiffs, that notice was afterwards given to Soloman hereof, and a demand of payment of him, and his refusal; that notice thereof was afterwards given to the defendant, who in consequence of the premises becoming chargeable, promised to pay, &c.
Neither the proof at the trial, nor the case as stated, warrants the conclusion, that the indorsement was made and delivered by Rendon to the defendant, as laid in both counts. The demand on Soloman, as laid down in the second count, after the 2d December 1786, or notice given to Rendon or the defendant subsequent to his indorsement, is not admitted by the case. It is obvious then that the declaration states facts which do not exist, and the allegata and probata do not agree; consequently on the face of the record, the plaintiffs are not entitled to recover. If they choose hereafter to bring special assumpsit, founded on any supposed engagement of the defendant at the time of his indorsement, they must bring their suit accordingly and so declare.
The defendant’s indorsement of the note operated only as an order to Soloman to pay the contents to the plaintiffs; Soloman was bound to pay on demand, and on his-refusal and notice given thereof to the defendant in convenient time, a cause of action against him arose. The plaintiffs could only have marked above the blank indorsement of the defendant, either a receipt or an order to pay the contents to other persons.
The contract on the 2d December 1786, amounted to a new note drawn by Rendon indorsed by the defendant. This appears from the expressions of Justice Buller in 3 Term Rep. 83. To raise a charge therefore against the defendant, a subsequent demand should be made on Rendon. But no such subsequent demand it is admitted, was made either on him or Soloman. — Promissory notes assume the shape of bills ot exchange only when indorsed; and the indorsee must first make his demand against the maker of the note, and on his default only, can have recourse to the indorser, 2 Burr. 676. The indorser is conditionally liable. Demand must be made of the drawer, and notice must be proved to have been given t° the indorser of the * drawer’s default, before the in-J dorser can be charged. 2 Stra. 1087. Eovelass on Bills 40. Bayley 17, 28. 1 Wils. 48. 1 Espin. 35. (Eon-don edit. 32.) A demand of the drawer of a note, and notice to this effect to the indorser, are absolutely necessary to be laid in the declaration by the indorsee against the indorser. Doug. 654. Notice to an indorser means something more than knowledge; because it is competent to the holder to give credit to the maker. Per Ashurst, 1 Term Rep. 169.
The indorser is chargeable only in a secondary degree, and to render him liable, you must shew that the holder looked to him for payment, and gave him notice that he did so. Per Buller, lb. 170.
The protest before the. 2d December 1786, cannot affect the defendant. After his indorsement, the note might be considered as payable on demand; and in this light he only became chargeable after application made to Soloman, and notice thereof given to the defendant.
E contra,
it was urged for the plaintiffs, that the books of entries furnished no other precedents than those pursued in the present declaration, in order to charge an indorser. Rendon’s indorsement having been in blank, the plaintiffs were at liberty to apply it as they pleased. To effectuate the intention of the parties, Rendon had been considered as the indorser to the defendant, who lent his name to give a credit to the note; — which certainly was allowable. An acceptance to pay a bill of exchange, according to its tenor, made after the time appointed for its paymeent, is a general acceptance to pay it on demand, i Ed. Ray. 364.
The objection was taken therein, that the promisé was void, because impossible to be performed, the day of payment being past at the time of the acceptance of the bill, and so impossible to be performed secundum tenorem et effectum billtz prcedictce, all which appeared upon the plaintiff’s declaration. But the court held, that it would amount to a promise to pay generally. Ib. The indorsement of a bill after the day of payment is very common and usual, and a very good practice. Ib. 575. Bayl. 16, 17. I Show. 163.
The defendant’s counsel had certainly mistaken the meaning of Mr. Justice Buller. The words he uses in 3 Term Rep. 83, are ‘1 When the note has been indorsed after it became due, I “consider it as a note newly drawn by the person indorsing it. ’ ’ The indorsement of a note after the day of payment past, cannot be considered as a warranty for the drawer’s performing his contract. It would be morally impossible that he should perform it. The substance of the indorsement would operate as an * engagement to be- r*ooc> come the principal debtor, and 'be accountable for the *- money. Indorsement on a blank note or bill, is an engagement and letter of credit, to an indefinite sum. Doug. 496,

Opinion:
M'Kean, C. J.
I have taken time to deliberate on this matter, my brethren being stockholders of the North American Bank, and declining on that account to give any opinion.
This declaration is good in substance. The opinion of Buller, cited from 3 Term Rep. 83, goes the whole length of this case. Adjudications in England since the revolution, are not eqnally binding on us as those previous to our declaration of independencei But where they are founded on sound principles of law, general convenience applicable to our local situation, and good sense, they will have weight. Every indorsement of a bill of exchange is considered as a new bill. After the day of payment in a note is expired,, the indorser cannot be looked on otherwise than as a new drawer. The defendant here cannot be supposed to give a warranty for Rendon, who was then about to leave the continent, and sail for Europe. This would be 'an absurd notion. The parties must necessarily have meant something else; and it is obvious that the defendant's indorsement must have been considered as an original undertaking, to become responsible for the amount of the principal and' interest. It certainly must have been so understood at the time by all the parties; and the substantial justice of the case demands that I should pronounce
Judgment for the plaintiff.
In 8 S. & R., 355, Duncan, J., "The Bank of North America v. Barriere, I Yeates, 360, is a decision in apparent contradiction of this; but it was the opinion of one judge only, Chief Justice McKean, certainly a very eminent judge, and whose opinions are entitled to great respect, and is distinguished from this case. There the note was overdue two years, payable on a. certain day, had been dishonored and protested, and the defendant was a new indorser. That case was decided on its own circumstances."
In 12 Pa., 273, Coui/TER, J., said that the observations of Judge Duncan «ill not be sustained by a careful inspection of the case. .
In 18 Pa., 432, Lewis, J., sustained the criticism of Judge Duncan.
In 9 Watts, 353, Kennedy, J., followed the Bank of North America v. Barriere.
In 1 Phila., 283, the trial judge instructed the jury that the endorsement of a note by the defendant after maturity was equivalent to the making of a new note. The court in banc made absolute a rule for a new trial, saying: "The judge undoubtedly had in his eye the case of Bann of North America v. Barrieré, 1 Yeates, 360, which is to the point, and a dictum of judge Kennedy in Leidy v. Tammany, 9 Watts, 353, which seems to give the plaintiff an election to treat such an endorsement as a new note. Yet the commercial law seems now to be very well settled, as stated by Chancellor Kent, 3 Com., 93, that if a bill or note be negotiated after it is due, yet a demand must be made upon the drawer or maker within a reasonable time, and notice given to the endorser, in order to charge him, equally as if it had been payable at sight or negotiated before it was done. And our own cases of McKinney v. Crawford, 8 S. & R., 351, and Brezer v. Wightman, 7 W. and S., 264, fully sustain that position."
Referred to in 29 Pa., 532. See also Tyler v. Young, 30 Pa., 143.