Court Opinion

ID: 8629395
Source: CourtListenerOpinion
Date Created: 2022-11-24 19:35:15.058174+00
Date Added: 2024-06-11T16:55:42.962320
License: Public Domain

NELSON, Circuit Justice.
I. The case of Dugan v. U. S.. 3 Wheat. [16 U. S.] 172, is an authority in favor of the right of the plaintiff to sustain this suit in his own name, notwithstanding the endorsements upon the bill subsequent to that of Huston. The proof shows with reasonable certainty, that those endorsements were made for the purpose of transmitting and collecting the paper. They, therefore, might have been stricken out at the trial. But, if otherwise, and if they had been made for value, in the usual course of business, inasmuch as it appears that the plaintiff was the holder and owner of the paper at the time the suit was brought, it was properly brought in his name; and this, whether the endorsements were stricken out at the trial or not. On the plaintiff's becoming revested with the title to and interest in the bill, the endorsements, whether for value or transmission, became matters of form, and were properly disregarded.
II. The bill was presented for acceptance on the 21st of March, acceptance was refused, and it was duly protested. After-wards, on the 11th of June, it was protested for non-payment. A qualified acceptance by the defendants appears on the bill under the latter date, to the amount of the proceeds of the hams against which it was drawn, and it is insisted that this is conclusive upon the plaintiff, as he must be presumed to. have taken the conditional acceptance, and to have waived the benefit of the previous refusal.
There is no positive proof in explanation of the circumstances under which this conditional acceptance was written on the bill, The fact, however, that Stedman, who presented the bill for payment at that time, *276caused it to be protested on tbe same day for non-payment, affords ground for tbe conclm sion, that be did not assent to tbe qualified acceptance, but, on tbe contrary, regarded it as a refusal of payment, and as dishonoring tbe paper. Tbe subsequent receipt from tbe defendants of tbe avails of tbe bams, when taken in connection with tbe previous facts and circumstances, must be deemed to bave been an application of the proceeds, only as far as they would go towards payment, and not an acceptance of them in satisfaction. Tbe receipt does not purport to be in full, and the protest which Stedman caused to be made, at tbe time of tbe conditional acceptance, is altogether irreconcilable with the idea, that be intended to assent to that acceptance and take tbe proceeds in satisfaction. Tbe conclusiveness of tbe receipt of tbe proceeds depends upon tbe conclusiveness of tbe conditional acceptance. If tbe latter fails, tbe former must also.
III. Tbe main question in tbe case is, whether or not tbe plaintiff can maintain tbe suit in bis own name, under tbe counts charging tbe defendants with a promise to accept drafts drawn against consignment of western produce to him by tbe owner. Tbe draft in question having been drawn by Huston in pursuance of authority communicated by tbe defendants to Smith their agent, there can be no doubt that Huston could bave maintained tbe action in bis own name. It is insisted, however, that the plaintiff cannot, on tbe ground of a want of privity between him and tbe defendants, and that tbe promise, if made at all, was made to the owner and shipper of tbe produce, and not to any third person who might choose to advance money upon tbe draft.
Tbe eases of Coolidge v. Payson, 2 Wheat. [15 U. S.] 66, and of Boyce v. Edwards, 4 Pet. [20 U. S.] 111, are direct authorities to show, that the defendants in this case are not chargeable as acceptors of tbe bill. To make them liable in that capacity, the letters authorizing Huston to draw should have described the bill to be accepted, with reasonable certainty, so that its identity could not be mistaken by the party who should take it upon tbe faith of such authority. In Coolidge v. Payson the letters specified the particular bill to be drawn, and the endor-see, who had taken it on the faith of such authority, recovered against the defendants as acceptors. Tbe court came to the conclusion, after a review of all the cases, that a letter written within a reasonable time before or after the date of a bill of exchange, describing it in terms not to be mistaken, and promising to accept it, was a virtual acceptance, binding on the person who made the promise, if the bill was taken on tbe credit of the letter by a person to whom it was shown. In Boyce v. Edwards the plaintiff failed to recover against the defendants as acceptors, tbe authority to draw having been general, as it was in tbe case before us. The defendants were merchants in Charleston, who gave a general letter of credit to one Anderson of Georgia, to buy and ship cotton to them, and, on sending the bill of lading, to draw upon them for tbe price. The bills in question had been drawn in pursuance of this authority, and negotiated to the plaintiff, who took them on tbe faith of tbe letter of credit. In the court below tbe plaintiff was allowed to recover against the defendants as acceptors. Tbe supreme court, after referring to tbe case of Coolidge v. Payson, and other cases affirming the same doctrine, held, that the judgment of the court below was erroneous, on tbe ground, principally, that tbe letter bad no reference to the particular bills to be drawn, but was a general authority do draw at any time and to any amount, upon lots of cotton shipped, and that it did not describe any particular bills in terms not to be mistaken, which was indispensable in order to make the defendants liable as acceptors. The court further remarked, that tbe distinction between an action on a bill as an accepted bill, and one founded on a breach of a promise to accept, seemed not to have been adverted to, but that tbe evidence necessary to support tbe one or the other was materially different; that to maintain the former, tbe promise must be applied to tbe particular bill alleged in tbe declaration to bave been accepted, while in tbe case of the latter, the evidence might be of a more general character, and tbe authority to draw be collected from circumstances and extended to all bills coming fairly within tbe scope of the promise. The court also observed, that, as respected the rights and remedies of the immediate parties to tbe promise to accept, and of all others who might take bills upon the credit of such promise, they were as secure and as attainable by an action on the breach of the promise to accept, as they could be by an action on the bill itself; and that tbe action might bave been sustained, as the evidence stood, if tbe declaration bad contained a count, properly framed, on a breach of tbe promise to accept.
Tbe same doctrine was asserted and applied in the'case of Russell v. Wiggin [Case No. 12,165]. There the defendants gave to one Breed a letter of credit, authorizing one Bndicott to value on them at London, at six months sight, at any place in India, for account of Breed, for any sums not exceeding in all fifteen thousand pounds sterling, engaging that tbe bills should be duly honored when presenten, if drawn within twelve months from tbe date of the letter. The plaintiffs, to whom tbe letter was exhibited, took tbe bills in question for value, relying on tbe commercial standing of tbe defendants, and on their promise in tbe letter. The declaration contained a count on a promise to accept. Judge Story, after an elaborate examination of tbe question, both on principle and authority, came to the eonelu*277sion that the plaintiffs were entitled to recover. He referred to the case of Boyce v. Edwards, as affirming the same doctrine, and observed that in that case the court held, that if, because the bill to be drawn was not definitely described in the manner limited by the case of Coolidge v. Payson, the promise to accept would not operate as an acceptance in favor of the party receiving the bill, still it would operate as a promise to him to accept the bill when drawn, and thus be equally available. See, also, Adams v. Jones, 12 Pet. [37 U. S.] 207.
Upon the foregoing view of the authorities, therefore, this suit was properly instituted in the name of the plaintiff, and may be sustained on the promise to accept, as laid in the third and fourth counts of the declaration. New trial denied.