In the case of
Bank of the United States v.
Dunn, 6 Pet. 51, this Court decided that a
subsequent endorser was not competent to prove facts which would
tend to discharge the prior endorser from the responsibility of his
endorsement. By, the same rule, the drawer of the note is equally
incompetent to prove facts which tend to discharge the
endorser.
The officers of the bank have no authority, as agents of the
bank, to bind it by assurances which would release the parties to a
note from their obligations. The principles of the case of
Bank of the United States v.
Dunn, 6 Pet. 51, affirmed.
This was an action on a promissory note drawn by Betty H. Blake,
executrix of J. H. Blake, for the sum of $5,200 on 27 March, 1822,
in favor of the defendant and by him endorsed to plaintiffs. The
defendant pleaded nonassumpsit and the statute of limitation.
On the trial of the cause before the circuit court, the
following bill of exceptions was signed.
"Be it remembered that on the trial of the above cause, the
plaintiff, in order to sustain the issue, gave in evidence the
following promissory note, on which the action was brought: "
" Washington City, March 27, 1822. $5,200. Sixty days after
date, I promise to pay to Dr William Jones or order $5,200 for
value received, negotiable at the Bank of the Metropolis."
"BETTY H. BLAKE"
"
Executrix of J. H. Blake"
" 16 May, 1825. I do hereby admit that a part of the above note
is due, and that I am bound to pay whatever balance thereof is due
as far as I was originally bound as endorser."
"WILLIAM JONES"
" Endorsed -- WILLIAM JONES"
"And the defendant admitted the endorsement thereon, as well as
the memorandum on the face thereof, to be in his handwriting,
Page 33 U. S. 13
and the plaintiff further proved that said note was regularly
protested for nonpayment and notice thereof duly given to the
defendant, and the defendant waived before the jury the defense
upon the statute of limitation."
"Whereupon the defendant, to prove the issue on his part, under
the plea of nonassumpsit, produced Mrs. Betty H. Blake, the drawer
of said note, to whom a release was executed by defendant,
exonerating her from any responsibility for the costs in this suit,
to the form of which release no objection was made. The plaintiff
objected to the competency of Mrs. Betty H. Blake to certify to any
matters impeaching the original validity of the said note, or of
said endorsement, but the court overruled the exception and
permitted the said witness to be sworn and examined."
The evidence of Mrs. Blake was the following:
"That at the time of the death of her husband, Doctor James H.
Blake, in the summer of 1819, there were several notes drawn by him
running in said Bank of the Metropolis, and that said deceased was
also indebted to other persons in various sums. That when the
notary came with one of said notes to procure payment from her,
she, being the sole devisee and executrix of the last will and
testament of said deceased, objected to a renewal. Witness sent to
General Van Ness, who was at the time the president of the said
Bank of the Metropolis, and whom her deceased husband, on his death
bed, had recommended to her to consult. Witness informed him that
she did not wish to renew the notes, but he advised her to
amalgamate the notes in bank. She informed him that she could not
ask anyone to endorse for her; that she would prefer having the
property sold, and the debts paid. She never heard General Van Ness
say anything upon the subject of the endorsements by the defendant
until long after they were made. Her conversation with General Van
Ness was in relation to the endorsement by her son James; he was
consulted by her as her confidential friend and adviser. He advised
her against selling the property, as it was very valuable and would
increase daily in value; that witness had better procure some
friend to endorse for her; that the security was so valuable the
endorser would incur no responsibility. He suggested her son James
as an endorser. She said he was not of age, and that she did
Page 33 U. S. 14
not wish him to commence the world encumbered with liabilities.
He said it was immaterial; that the security was so valuable he
could incur no risk. Under this impression, and in consequence of
this conversation, she procured her son to endorse said note, and
he continued on the note until he left Washington in the autumn of
1820; and she then mentioned to Dr Jones, the defendant, what
General Van Ness had advised and informed her, who in consequence
became the endorser, and so continued upon the renewal of said
notes until the date of the note in question. She gave a deed of
trust of certain property of James H. Blake, to secure the
Metropolis Bank the amount of the note, which she has been advised
she had no authority to give because she was not authorized to give
a preference to the Bank of the Metropolis over other creditors,
and she has repeatedly mentioned this circumstance."
The counsel for the plaintiff moved the court to instruct the
jury that this evidence was incompetent upon the trial of the
issue, but the court overruled the motion and instructed the jury
that the evidence was competent and proper evidence for their
consideration on the trial.
To this overruling exception was taken, and the plaintiffs
prosecuted this writ of error.
MR. JUSTICE McLEAN delivered the opinion of the Court.
This cause was brought into this Court by writ of error to the
Circuit Court of Washington County in the District of Columbia. In
that court, an action was commenced by the Bank of the Metropolis
against the defendant on a promissory note drawn by Betty H. Blake
for the sum of $5,200, dated 27 March, 1822, payable in sixty
Page 33 U. S. 15
days and negotiable at the Bank of the Metropolis, which note
was endorsed by the defendant to the bank.
The defendant pleaded nonassumpsit and the statute of
limitations, but on the trial waived the latter plea.
The plaintiff proved the endorsement of the defendant, that the
note was regularly protested for nonpayment and due notice
given.
On the trial, Betty H. Blake, the drawer of the note, was
offered as a witness after the defendant had executed to her a
release from any responsibility on account of the costs of the
suit, and the court permitted her to be sworn. Among other things,
this witness gave in evidence to the jury
"That at the time of the death of her husband, Doctor James H.
Blake, in the summer of 1819, there were several notes drawn by him
running in the Bank of the Metropolis, and that he was also
indebted to other persons in various sums. That when the notary
came with one of said notes to procure payment from her, she being
the sole devisee and executrix of the last will and testament of
said deceased, she objected to a renewal. Witness sent to General
Van Ness, who was at the time the president of the Bank of the
Metropolis, and whom her deceased husband, on his deathbed,
recommended her to consult. She informed him that she did not wish
to renew the notes, but he advised her to amalgamate them in bank;
that she informed him that she could not ask anyone to endorse for
her, and would prefer having the property sold and the debts paid.
General Van Ness advised her against selling the property, as it
was very valuable and would increase daily in value, and that she
had better procure some friend to endorse for her; that the
endorser would incur no responsibility, as the property was so
valuable. In pursuance of this advice, she procured the endorsement
of her son James, who was underage, and afterwards, when he had
left the City of Washington, she procured the defendant to endorse
for her on stating to him the advice and information given to her
by General Van Ness."
Whereupon the counsel for the plaintiffs moved the court to
overrule said evidence and to instruct the jury that it was
incompetent upon the trial of the said issue, but the court refused
to do so, and they instructed the jury that the said evidence
was
Page 33 U. S. 16
competent and proper for their consideration, to which opinion
and instructions of the court a bill of exceptions was taken.
The principle involved in this case is substantially the same
that was decided by this Court in the case of
Bank of the
United States v. Dunn, 6 Pet. 51. In that case, the
Court said, "it is a well settled principle that no person who is a
party to a negotiable instrument shall be permitted, by his own
testimony, to invalidate it." And this doctrine is sustained by
reason and authority. If an individual whose name appears upon the
face of a negotiable instrument, either as drawer, endorser, or
acceptor, shall be a competent witness to prove facts or
circumstances which lessen or destroy its value before or at the
time he gives it currency, the credit of commercial paper could not
be sustained. The rule laid down in 1 Term 296 on this subject is a
sound one and was sanctioned by this Court in the case above
cited.
On the part of the defendant in error it is contended that the
witness objected to was not the only witness in the case, and that
her testimony was competent as far as it went. That the court were
not called on to decide whether the facts stated by the witness
were sufficient in law to discharge the defendant from his
responsibility, but whether they conduced to prove an imposition
practiced on him by the bank which ought to discharge him.
If the testimony of the witness impaired the obligation of the
note, it was inadmissible under the rule stated, and that this was
the tendency of the evidence appears from the facts stated and the
argument just noticed. In the case cited of
Bank of the United
States v. Dunn, this Court decided that Carr, who was an
endorser after Dunn, was not competent to prove facts which would
tend to discharge Dunn from the responsibility of his endorsement.
And is it not clear by the same rule that in the case under
consideration, the drawer of the note is equally incompetent to
prove facts which tend to discharge the endorser?
In both cases, the discharge of the endorser was urged on the
ground that certain statements had been made by the officers of the
bank which induced the endorser to sign the paper under a belief
that by doing so he incurred no responsibility. As the ground
already stated is clear, it is unnecessary to add
Page 33 U. S. 17
in this case, as was stated by the court in the case of
Dunn, that the officers of the bank had no authority, as
agents of the bank, to bind it by the assurances which they
gave.
The judgment of the circuit court is
Reversed and the cause remanded for further
proceedings.
This cause came on to be heard on the transcript of the record
from the Circuit Court of the United States for the District of
Columbia, holden in and for the County of Washington, and was
argued by counsel, on consideration whereof it is ordered and
adjudged by this Court that the judgment of the said circuit court
in this cause be and the same is hereby reversed, and that this
cause be and the same is hereby remanded to the said circuit court
for further proceedings to be had therein according to law and
justice and in conformity to the opinion of this Court.
