Court Opinion

ID: 3630917
Source: CourtListenerOpinion
Date Created: 2016-07-06 00:10:29.711956+00
Date Added: 2024-06-11T14:07:40.592141
License: Public Domain

Upon the facts of this case as found, the only question for review in this court is, whether where a note is made by a resident of this State without any place of payment designated, who, before the note is payable, removes from the State and takes up a permanent residence in another State, the holder of the note is bound to present it for payment at the last place of residence of the maker within the State in order to charge the indorser. The question has never been directly decided by the courts of this State, and it is proper therefore to look somewhat into the principles governing the law of commercial paper. Where a promissory note is not made payable at any particular place, the general rule of law is that, in order to charge the indorser, payment be demanded of the maker personally or at his dwelling-house, or other place of abode, or at his counting-house or place of business. (Story on Promissory Notes, § 235; Bank ofAmerica v. Woodworth, 18 J.R., 315; 19 Id., 391.) Though this is the general rule, yet a demand may be dispensed with entirely under particular circumstances. It is a question of due diligence, and if a demand is found to be impracticable, proper efforts for that purpose having been made, the indorser will still be held liable, due notice having been given to him by the holder. (3 Denio, 145.) Thus when the maker has absconded, that will ordinarily excuse a demand, and notice of the fact is sufficient to hold the indorser. (1 Ld. Raym., 443, 743; Chitty on Bills, 400, 401, 8th Am., from the 8th Lond. ed.; Story on Promissory Notes, § 237; 3 Kent's Com., 123, 6th ed.; Putnam v.Sullivan, 4 Mass. R., 45; 1 Watts  Serg., 126; 4 Serg. 
Rawle, 483; 3 Denio, 154). So when the maker is a seaman on a voyage, having no domicil in the State, the indorser is liable without a demand; and so indeed in every case where the maker has no known residence or place at which the note can be presented for payment, the indorser will be excused from making any demand whatever. (Story on Promissory Notes, § 237; Whittier v.Graffam, 3 Greenl. R., 82; Putnam v. Sullivan, 4 Mass. R., 53; Duncan v. McCullough, 4 Serg.  Rawle, 480; 3 Denio, 151.) In all these cases, *Page 38 
however, the excuse for not making a demand must be shown on the trial of the cause. In all these cases it must appear that the maker had absconded, was at sea, or had no known domicil or place of residence where the note should be presented. The rule is strict that a demand must be made or a proper excuse shown for its omission. The rule seems to be very well settled, also, that if the maker of the note, subsequent to the making and before its maturity, has removed from the State, and become domiciled in another State, the holder need not follow him and make a demand there. (3 Kent's Com., 123, 8th ed.; 9 Wheat. R., 598; 18 J.R., 322; 7 N.H.R., 199; 4 McCord's R., 503; 2 Watts  Serg., 401; 3 Denio, 151; Edwards on Bills and Promissory Notes, 159.) But whether in such a case the holder is excused from presenting the note at the last place of residence of the maker in the State, does not seem to be very well settled. I feel constrained to say, after a careful examination of the question, and the best reflection which I have been able to bestow upon it, I think he must make the demand at the last place of residence of the maker within the State; and if he omit to do so, that the maker is discharged. I know that it is held that the holder is excused from making any demand when the maker had absconded. The cases, it seems to me, are not analogous. The law will not indulge in any presumption that where a man has absconded he has left funds at his last place of residence in the State to pay his notes. It seems to me, however, where a man removes from the State, after he has made a note, and before its maturity, knowing the law to be that the holder is under no legal obligation to follow him into the State of his changed domicil, that the law will indulge the presumption that he has saved his indorser from protest by leaving funds at the place where he knew the holder would have to present it if he had remained in the State, or where he might think it would be presented at maturity. The elementary writers upon this branch of the law, so far as I have been able to consult them, without exception, seem to regard the demand at the last place of residence of the maker in the State as necessary. At least it is fairly to *Page 39 
be implied that they regard it as necessary from the manner in which they state the rule. Chancellor KENT states the rule, as follows: "If the maker of the note or acceptor of the bill has removed out of the State, subsequent to the making of the note, or accepting the bill, it is sufficient to present the same at his former place of residence." (3 Kent's Com., 130, 9th ed.) Edwards in his recent Treatise on Bills and Promissory Notes, page 159, states the rule in the same language. (Story on Bills of Exchange, § 352, 3d ed.; Chitty on Bills, pp. 412, 413, 12th Am. ed., from the 9th Lon. ed.) There are some of the judges in this State, certainly, who have assumed a demand to be necessary in such a case. It was so assumed by Chief Judge THOMPSON inAnderson v. Drake (14 J.R., 114). Judge BEARDSLEY assumes this to be the rule in delivering the opinion of the court inTaylor v. Snyder (3 Denio, 151), and so does Judge JEWETT in delivering the opinion of the court in the case of Spies v.Gilmore (1 Comst., 326, 327). This distinct question was presented to the Supreme Court of Massachusetts in the case ofWheeler v. Field (6 Met. R., 290), and the court held that the holder was bound to demand payment at the maker's last place of residence or place of business within the State where he made the note, if he can find it by due diligence. This case deciding what I think was, by the understanding of the profession, the law on this subject, I think we should follow it. I am aware that the Supreme Court of Ohio in the case of Gist v. Lybrand (3 Ham. Ohio R., 319), has decided this question directly the other way. The case, however, seems to have been decided upon the strength of the authority of McGruder v. The Bank of Washington (9 Wheat. R., 598). In that case the note was presented at the last place of residence of the maker within the District of Columbia, and the only question really presented for decision was, whether the note was properly protested on the demand made at the last place of residence of the maker, and the court held that it was. I cannot but think that the Supreme Court of Pennsylvania fell into an error in the case of Reid v. Morrison (2 Watts 
Serg., 401), where they say that the same rule which exists *Page 40 
in the case of an absconding maker applies equally to that of the removal of the maker into another jurisdiction after the execution of the instrument. Now it seems to me that we have seen that the two cases are not analogous: that there are good reasons for holding a different rule in the latter case. If I am correct in the views above expressed, it follows that the judgments of both the general and special terms in this case should be reversed, and a new trial granted.
COMSTOCK, Ch. J., expressed no opinion; SELDEN, J., was absent.
Judgment affirmed.