The deposit of a bill in one bank, to be transmitted to another
for collection, is a common usage of great public convenience, the
effect of which is well understood, and the duty of a bank
receiving such a bill for collection is precisely the same whoever
may be, the owner thereof, and if it was unwilling to undertake the
collection without precise information on the subject, the duty
ought to have been declined.
If in any case in which testimony was offered by the plaintiff
the court ought to instruct the jury that he had no right to
recover, such instruction certainly ought not to be granted if any
possible construction of the testimony would support the
By failing to demand payment of a bill held for collection, the
bank would make the bill its own and would become liable to its
real owner for the amount.
The allowance of days of grace for the payment of a bill of
exchange or note is now universally understood to enter into every
bill or note of a mercantile character, and so to form a pari of
the contract that the bill does not become due until the last day
It is the usage of the Bank of Washington and of other banks in
the District of Columbia to demand payment of a bill on the day
after the last day of grace, and this usage has been sanctioned by
the decisions of this Court. This usage is equally binding on
parties who were not acquainted with its existence but who have
resorted to the bank governed by such usage to make the bill
The usage of the place on which a bill is drawn or where payment
is demanded uniformly regulates the number of days of grace which
must be allowed.
The failure of a bank holding a bill payable after date for
collection to give notice to the drawer that the drawee was not
found at home when called upon to accept the bill is not such
negligence as discharges the drawer from his liability.
A bill of exchange payable after elate need not be presented for
acceptance before the day of payment, but if presented and
acceptance be refused, it is dishonored, and notice must be given.
The absence from his home of the drawee of a bill payable after
date when the holder of a bill or his agent calls with it for
acceptance is not a refusal to accept, but such absence when the
bill is due is a refusal to pay, and authorizes a protest.
In a suit instituted by the holder of a bill against the bank
for negligence in relation to demand or notice of nonpayment of the
bill, the court, although required, is not bound to declare the law
as between the holder and the drawer. The bank was the agent of the
holder, and not of the drawer, and might consequently so act as to
discharge the drawer without becoming liable to its principal.
Triplett & Neale, the appellees, instituted a suit in the
Circuit Court for the District of Columbia against the
Page 26 U. S. 26
President and Directors of the Bank of Washington, the
appellants; for mal-agency in relation to an inland bill of
exchange, dated Alexandria, 19 June, 1817, drawn by W. H. Briscoe,
for $625.34 at four months after date in favor of Triplett &
Neale upon Peter A. Carnes, Esq., "Washington City." About 19 July,
1817, the plaintiffs, being the holders and the proprietors of the
bill, placed it in the hands of the Cashier of the Mechanics bank
of Alexandria for the purpose of its being transmitted to a bank in
Washington for collection, they endorsing it in blank for that
purpose. The bill, after being endorsed by the cashier of the bank
to the order of "S. Elliott, Jr. Esq.," was sent by mail to the
Bank of Washington, of which Mr. Elliott was then cashier, together
with other bills and notes, without any statement of interest or
ownership in the same, by Triplett & Neale. On 19 October,
1817, the cashier of the Mechanics bank of Alexandria informed the
cashier of the Bank of Washington that
"the holder of the draft desired that if the draft should not be
paid, a notary should send a notice to P. A. Carnes, Baltimore, and
to Mr. W. H. Briscoe at Lessburgh, provided the bill should not be
paid in Washington."
On 24 October, 1817, the draft was returned to the Mechanics
bank of Alexandria, it having been protested, for nonpayment on 23
October, the drawer and endorser having been regularly notified of
the nonpayment by the notary. When the bill was received in
Washington on 21 July, 1817, the drawee was not to be found, one of
the officers of the bank having sought him in order to present the
bill to him and who was informed that he was in Baltimore. This
inquiry was repeated three or four days afterwards with the same
results, of which the cashier was informed. No notice of the
nonacceptance of the bill was given by the Bank of Washington to
the drawer or to the endorser. Evidence was given, by the defendant
below of the custom in the banks of the City of Washington, and
particularly of the defendants, as to the mode of treating bills
when the drawee could not be found and as to the practice of
protesting or not protesting such bills for nonacceptance. Evidence
was also offered as to the incompetency of Carnes and Briscoe to
discharge the bill at the time of its nonpayment, and that since
the said period Briscoe had inherited an estate.
The appellants, on the trial of the cause, requested the court
to instruct the jury:
1st. That on the evidence, if believed by the jury, the
plaintiffs could not recover.
2d. That the plaintiffs are not entitled to recover for and of
recourse against Briscoe, the drawer of the bill.
Page 26 U. S. 27
3d. That the failure of the defendants, after having called at
the residence of the drawee of said bill, to obtain his acceptance
thereof, as stated in the evidence of Reilly, and not finding him
or any other person there to accept the said bill, to notify the
drawer of that circumstance was not such a negligence as discharged
the said drawer from his liability on said bill, and entitles the
plaintiffs to recover.
4th. That if it believed from the evidence that the defendants
conformed to their former usage in regard to such bills as the one
in question in calling on the drawee for acceptance, the said
drawee being from home and not noting the same as dishonored and
giving notice thereof to the parties on the said bill, then their
failure to treat the said bill as dishonored and to give notice
accordingly of its nonacceptance did not discharge the drawer
thereof from his liability to the plaintiffs.
All of which instructions were refused by the court, and a
verdict was given against the Bank of Washington for the whole
amount of the claim. The defendants below took a bill of exceptions
to the opinion of the court upon the propositions stated and
thereupon prosecuted this writ of error.
Page 26 U. S. 28
MR. CHIEF JUSTICE MARSHALL delivered the opinion of the
On 19 June, 1817, Wiliam H. Briscoe, of Alexandria, drew a bill
on Peter A. Carnes, of Washington, payable four months after date
to the order of Triplett & Neale. The payees of the bill
endorsed it in blank and delivered it to the cashier of the
Mechanics bank of Alexandria for the purpose of being transmitted
through the said bank to a bank in Washington for collection.
The cashier of the Mechanics bank of Alexandria endorsed the
bill to the order of the cashier of the Bank of Washington and
transmitted it to him for collection in a
Page 26 U. S. 29
letter of 19 July, 1817. Neither of the banks had any interest
in the bill.
The bill was protested for nonpayment, and this suit was brought
by Triplett & Neale against the Bank of Washington to recover
its amount. The declaration charges that the bank did not use
reasonable diligence to collect the money mentioned in the said
bill, nor take the necessary measures to charge the drawer, but
neglected to present the bill either for acceptance or payment and
to have the same protested, whereby the plaintiffs have lost their
recourse against the drawer.
It was proved on the part of the bank that either on the day the
bill was received or the succeeding day one of its officers called
with the bill at the house of the said Peter A. Carnes for the
purpose of presenting it for acceptance, and was told that he was
in Baltimore. He called again three or four days afterwards for the
same purpose, and was again told that he was in Baltimore. These
answers were reported to the cashier.
On 9 October, 1817, the cashier of the Mechanics bank of
Alexandria addressed the following letter to the cashier of the
Bank of Washington:
"The holder of the draft on Peter A. Carnes for $625.34 desires
me to inform you that if the draft is not paid to make the notary
send a notice to P. A. Carnes, Baltimore, and likewise to W. H.
Briscoe, Leesburg, provided it is not paid at his residence in
On the 13th of the same month, the cashier of the Bank of
Washington, in answer to this letter, stated that the bill had not
been accepted because the drawee could not be found, and that the
directions given in the letter of the 9th, should be observed. On
24 October, the fourth day after that expressed on the face of the
bill as the day of payment, it was protested for nonpayment and
returned under protest to the Mechanics bank of Alexandria. Notice
was given to the drawer, who has refused to pay the same.
On the trial the counsel for the defendant moved the court to
instruct the jury:
1st. That upon this evidence, if believed, the plaintiffs are
not entitled to recover.
2d. That the plaintiffs are not entitled to recover for any loss
of recourse against Briscoe, the drawer of the said bill.
3d. That the failure of the defendants, after having called at
the residence of the drawee of the said bill to obtain his
acceptance and not finding him or any person there to accept it, to
notify the drawer of that circumstance was not
Page 26 U. S. 30
such negligence as discharged the said drawer, from his
liability on the said bill and entitles the plaintiffs to
4th. That if they believed from the evidence that the defendants
conformed to their former usage in regard to such bills as the one
in question in calling on the drawee for acceptance (the said
drawee being from home) and not noting the same as dishonored, and
giving notice thereof to the parties, on the said bill, then their
failure to treat the said bill as dishonored and to give notice
accordingly of nonacceptance did not discharge the drawer thereof
from his liability to the plaintiffs.
The court refused to give either of these instructions, to which
refusal the counsel for the defendants excepted, and a verdict and
judgment were rendered for the plaintiffs.
The plaintiffs in error insist that the circuit court ought to
have given the instructions first asked, because, 1st, no privity
existed between the real holder of the bill and the Bank of
Washington. That bank was not the agent of Triplett & Neale,
but was the agent of the Mechanics bank of Alexandria, some cases
have been cited to show that if an agent employed to transact a
particular business engages another person to do it, that other
person is not responsible to the principal. On this point it is
sufficient to say that these cases, however correctly they may have
been decided, are inapplicable to the case at bar. The bill was not
delivered to the Mechanics bank of Alexandria for collection, but
for transmission to some bank in Washington, to be collected. That
bank would, of course, become the agent of the holder. By
transmitting the bill as directed, the Mechanics bank performed its
duty, and the whole responsibility of collection devolved on the
bank which received the bill for that purpose; the Mechanics bank
was the mere channel through which Triplett & Neale transmitted
the bill to the Bank of Washington.
The deposit of a bill in one bank to be transmitted for
collection to another is a common usage of great public
convenience, the effect of which is well understood. This
transaction was unquestionably of that character, and there is no
reason for suspecting that the Bank of Washington did not so
understand it. The duty of that bank was precisely the same whoever
might be the owner of the bill, and if it was unwilling to
undertake the collection without precise information on the
subject, that duty ought to have been declined. The custom to
endorse a bill put in bank for collection is universal, and the
Bank of Washington had no more reason for supposing that Triplett
& Neale had ceased to be the real holders from their
endorsement than for supposing that the
Page 26 U. S. 31
cashier of the Bank of Washington had become the real holder by
the endorsement to them. It is the customary proceeding for
collection in such cases, and is for the advantage of the party
interested. At any rate, the letter of 9 October disclosed the real
party entitled to the money; and the answer to that letter, assumes
the agency, if it had not been previously assumed. The Court is
decidedly of opinion that the Bank of Washington, by receiving the
bill for collection and certainly by its letter of 13 October,
became the agent of Triplett & Neale and assumed the
responsibility attached to that character.
The first prayer of the defendants in the circuit court being to
instruct the jury that upon the whole evidence, the plaintiff ought
not to recover, if it might properly have been granted in any case
in which any testimony was offered, certainly ought not to have
been granted if any possible construction of that testimony would
support the action.
The liability of the bank for the bill placed in its hands for
collection undoubtedly depends on the question whether reasonable
and due diligence has been used in the performance of its duty. To
maintain the charge of negligence, the counsel for Triplett &
Neale have alleged the failure to give notice of the nonacceptance
of the bill and the failure to demand payment in proper time. The
counsel for the bank have brought the first question more
distinctly into view by a more definite instruction respecting it
which was afterwards asked, and its consideration will be deferred
until that prayer shall be discussed, but the first must be
disposed of under the general prayer.
Unquestionably, by failing to demand payment in time, the bank
would make the bill its own and would become liable to Triplett
& Neale for its amount. The inquiry, therefore, is into the
The demand was made on the fourth day after that mentioned on
the face of the bill as the day of payment.
The defendants in error insist that if the bill was never
presented for acceptance, payment ought to have been demanded on
the day mentioned on its face. If this be not so, then it ought to
have been demanded on the third day afterwards, which is the last
day of grace.
The allowance of days of grace is a usage which pervades the
whole commercial world. It is now universally understood to enter
into every bill or note of a mercantile character, and to form so
completely a part of the contract that the bill does not become due
in fact or in law on the day mentioned on its face, but on the last
day of grace. A demand of payment previous to that day will not
authorize a protest or charge the drawer of the bill.
Page 26 U. S. 32
This is universally admitted if the bill has been accepted.
If it has been noted for nonacceptance but has been held up, it
would not be protested for nonpayment until the last day of grace.
Why, then, should a bill never presented be demandable at an
earlier day than if it had been accepted or if acceptance had been
refused? Whatever might have been the original motive for the
indulgence, it is now taken into consideration both by the drawer
and payee of the bill. The amount is consequently estimated, on the
calculation, that it becomes really due on the last day of grace.
Neither party can foresee, when the bill is drawn, whether it will
be paid or not, nor, if it be payable after date, whether it will
be presented or not. Their calculation, therefore, as to the day
when it becomes really due and is to be paid is independent of
these considerations. No sufficient reason is perceived for the
It is, however, a law dependent on usage. The books which treat
on the subject concur in saying that payment must be demanded when
the bill falls due, and that it falls due on the last day of grace.
The distinction between a bill which has and which has not been
presented has never been taken, and it is apparent that a bill is
never drawn with a view to this distinction. The fact that the
question has never been made is a strong argument against it. The
point has never, so far as we can find, been brought directly
before a court, and we have seen only one case in which it has been
even incidentally mentioned.
Anderson v. Beck & Pearson, 16 East 248, a bill
was drawn payable two months after date, and was not presented for
acceptance. It was protested for nonpayment, and a suit was brought
by the holder against the drawer. He resisted the demand, and the
opinion of the court proceeds on the admission that the bill feel
due on the last day of grace. This case consists, we believe, with
the opinions and practice of commercial towns.
But if a bill, payable after date and not presented for
acceptance, falls due on the same day as if it had been accepted,
the defendants in error insist that payment ought to have been
demanded on the last day of grace.
It was proved at the trial that the settled usage of the Bank of
Washington at that time and of all the other banks in Washington
and Georgetown was to demand payment on the day succeeding the last
day of grace, and this usage, so far as respects notes negotiable
in a particular bank, has been sanctioned by the decisions of this
Renner v. the bank of
Columbia, 9 Wheat. 582, was a suit brought in a
Circuit Court of the District of Columbia against the endorser of
Page 26 U. S. 33
promissory note which had been negotiated in the bank of
Columbia. Payment was demanded and the note protested on the fourth
day after that mentioned in the note as the day on which it became
payable. This was proved to have been in conformity with the custom
of the bank, and the defendant moved the court to instruct the jury
that the demand was not in time and that the endorser was not
liable for the note. This instruction was refused, and the
defendant brought the judgment into this Court by writ of error.
The judgment, on great deliberation, was affirmed.
In this case, the custom of the bank was known to the parties to
the note. But the question arose afterwards in a case in which the
custom was not known to the parties.
v. bank of the United States, 11 Wheat. 430, was a
suit brought by the bank against the plaintiff in error and others
on a note endorsed by him and negotiated in the office of discount
and deposit of the bank of the United States, which was protested
for nonpayment on the day of the last day of grace.
It was proved at the trial that this was according to the usage
of that bank. The counsel for the defendant moved the court to
instruct the jury that this usage could not bind the endorser
unless he had personal knowledge of it at the time he endorsed the
note. The court refused to give the instruction, and the jury found
a verdict for the bank, on which judgment was rendered. That
judgment was brought before this Court and affirmed. The Court said
"when a note is made payable or negotiable at a bank, whose
invariable usage it is to demand payment and give notice on the
fourth day of grace, the parties are bound by that usage, whether
they have a personal knowledge of it or not."
In the case of such a note, the parties are presumed by
implication to agree to be governed by the usage of the bank, at
which they have chosen to make the security itself negotiable.
These cases decide that under consideration unless there be a
distinction between a bill and a note made negotiable in a
particular bank. In the case of a note negotiable in a particular
bank, the parties may very fairly be presumed to be acquainted with
the usage of that bank. As the decisions which have been cited
depend upon that presumption, it will become necessary to inquire
how far the same presumption may be justified in the case of a bill
drawn on a person residing in a place where this usage is
If a promissory note were made in the City of Washington payable
to a person residing in the same place, though not purporting to be
payable and negotiable in bank, it would very probably be placed in
a bank for collection. It is a common
Page 26 U. S. 34
practice, and the parties would contemplate such an event as
probable when the note was executed.
The same reason seems to exist for applying the usage of the
bank to such a note, as to one expressly made payable and
negotiable in bank. Such notes are frequently discounted, and
certainly the person who discounts them or places them in bank for
collection stands in precisely the same relation to the bank, as
respects its usage, as if the notes purported on their face to be
negotiable in bank. The maker of a negotiable paper in such a case
may fairly be presumed to be acquainted with the customary law
which governs that paper at his place of residence.
In the case at bar, however, the bill was drawn at Alexandria,
on a person residing at Washington. Does this circumstance vary the
law of the case?
The usage by which questions of this sort are governed is
different in different places. It varies from three to thirty days
-- and the usage of the place on which the bill is drawn or where
payment is to be demanded, uniformly regulates the number of days
of grace which must be allowed. This bill being drawn on a person
residing in Washington and being protested for nonpayment in the
same place is, according to the law merchant, to be governed by the
usage of Washington. Could this be questioned, still the holder of
the bill, who placed it, by his agent, in the Bank of Washington
for collection, who has made that bank his agent, without special
instructions, submits his bill to their established usage. The
cases, then, which have been cited are not different in principle
from this -- and payment having been demanded according to the
invariable usage of the bank was demanded in time. If then the
objections to the conduct of the bank were confined to the demand
of payment and protest for nonpayment, the first instruction asked
by the defendants in the circuit court, ought to have been given.
But they are not confined to the demand of payment and to the
protest for nonpayment. They extend to the steps taken by the bank
concerning the presentation of the bill.
The second instruction asked for is in terms which are in some
degree equivocal. It may imply either that the recourse against the
drawer of the bill was not lost or that if lost that circumstance
would not entitle the plaintiff to recover against the bank; as its
decision is not essential to the cause, it will be passed over.
The third is more specific. The court is asked to say that the
failure of the bank to give notice to the drawer that the drawee
was not found at home when called upon to accept
Page 26 U. S. 35
the bill is not such negligence as discharged the drawer from
his liability and entitles the plaintiff to recover.
The question suggested by this prayer is one on which no
decision is found in the books. It depends on analogy so far as it
is to be decided by adjudged cases. Such a bill need not be
presented, but if presented and acceptance be refused, it is
dishonored and notice must be given. Had the bank taken no step
whatever to obtain an acceptance, no violation of duty would,
according to these decisions, have been committed. Can any
unsuccessful attempt to do that which the law does not require
place the agent in the same situation that he would have stood in
had the drawee been found and had positively refused acceptance?
Absence from home, with a failure to make provision for payment
when a bill becomes due, is a failure to pay, but absence from home
when the holder of a bill or his agent offers it for acceptance is
in no respect culpable. Had the drawee received advice of the bill,
he could not have not known that it would be presented for
acceptance, because the law did not require it, and is consequently
not blameable for his absence when the officers of the bank came to
present it for acceptance. Had the bill, under such circumstances,
been protested for nonacceptance and returned, the drawer might not
have been liable for it.
The bill, then, on general principles ought not to have been
protested, and the absence of the drawee ought not to be considered
as equivalent to his refusal to accept. It might have been a
prudent precaution to have given information that the bill was not
accepted because the drawer had not been found, but we cannot say
that the omission would subject the agent to loss unless such was
the special usage of this bank.
4. The fourth prayer is for an instruction to the jury that if
they believe from the evidence that the defendants conformed to
their former usage in regard to such bills, in calling on the
drawee for acceptance (the said drawee being from home) and not
noting the same as dishonored, and giving notice thereof to the
parties on the said bill, then their failure to treat the said bill
as dishonored and to give notice accordingly of nonacceptance did
not discharge the drawer thereof from his liability to the
The court has already indicated the opinion that this omission
to treat the bill as dishonored in consequence of not finding the
drawee at home if the usage of the bank was not to notice such a
circumstance did not discharge the drawer; consequently this
instruction ought to have been given unless it should be supposed
foreign to the case in which it was asked. In a suit brought by the
holder against the bank, the
Page 26 U. S. 36
court was not bound to declare the law as between the holder and
the drawer unless the liability of the bank was determined by the
liability of the drawer. Although in the general, the one question
depends on the other, yet it may not be universally so. The bank
was the agent of the holder, not of the drawer, and might
consequently so act as to discharge the drawer without becoming
liable to its principal. In this case, however, as the agent
received on specific instructions, but was left to act according to
the law merchant, a course of proceeding which did not discharge
the drawer could not render the agent liable to the principal. This
prayer was therefore essentially the same with that which preceded
it, with this difference. The third prays an instruction, whatever
might be the usage of the bank; the fourth prays essentially the
same instruction provided the conduct of the bank conformed to its
usage. This instruction therefore ought to have been given as
prayed. Upon a review of the whole case, the Court is of opinion
that if the bank acted in conformity with its established usage in
not noting the bill and giving notice thereof when the ineffectual
attempt was made to present it for acceptance, this action could
not be supported. With respect to this usage, the testimony is
contradictory, and ought to have been submitted to the jury in
conformity with the last prayer made by the counsel for the bank.
The court erred in not giving this instruction, as prayed. The
judgment, therefore, is to be
Reversed and the case remanded for a new trial.
This cause came on, &c., on consideration whereof, this
Court is of opinion that the circuit court erred in refusing to
instruct the jury that if it believed that the defendants conformed
to their former usage in regard to such bills as the one in
question, in calling on the drawee for acceptance (the said drawee
being from home) and not noting the same as dishonored, and giving
notice thereof to the parties on the said bill, then their failure
to treat the said bill as dishonored and to give notice accordingly
of nonacceptance did not discharge the drawer thereof from his
liability to the plaintiffs. It is therefore considered by the
Court that the said judgment be reversed and annulled and that the
cause be remanded to the said circuit court with directions to
venire facias de novo, and to proceed therein
according to law.