In an action brought by the endorsee against the endorser of a
promissory note which had been deposited in a bank for collection,
the notary public who made the protest is a competent witness,
although he has given bond to the bank for the faithful performance
of his duty.
He is also competent to testify as to his usual practice.
The cases reported in
22 U. S. 9
Wheat. 582,
24 U. S. 11
Wheat. 430, and
26 U. S. 1 Pet. 25,
reviewed.
At the time when these decisions were made, it was the usage in
the City of Washington to allow four days of grace upon notes
discounted by banks, and also upon notes merely deposited for
collection.
But since then, the usage has been changed as to notes deposited
for collection, and been made to conform to the general law
merchant, which allows only three days of grace.
Although evidence is not admissible to show that usage was in
fact different from that which it was established to be by judicial
decisions, yet it may be shown that it was subsequently
changed.
The case was this.
On 17 May, 1839, E. T. Arguelles gave the following note.
"$300 Washington, May 17, 1839"
"On the first day of February next, I promise to pay to Thomas
Cookendorfer or order three hundred dollars for value received,
negotiable and payable at the Bank of Washington."
"[Signed] E. T. ARGUELLES"
"[Endorsed] THOS. COOKENDORFER"
"ANTHONY PRESTON"
This note was deposited in the Bank of Washington, for
collection. Not being paid at maturity by the drawer, it was
protested
Page 45 U. S. 318
under the circumstances and in the manner stated in the bill of
exceptions.
In February, 1842, a suit was brought by Preston, the endorsee,
against Cookendorfer, the endorser, which resulted in a verdict and
judgment for the plaintiff.
The following bill of exceptions shows the points of law which
were raised and ruled at the trial.
"
Memorandum. Before the jurors aforesaid retired from
the bar of the court here, the said defendant, by his attorney
aforesaid, filed in court here the following bill of exceptions,
to-wit:"
"
Defendant's Bill of Exceptions"
"ANTHONY PRESTON v. THOMAS COOKENDORFER"
"On the trial of this cause, the handwriting of the maker and
endorser of the note in the declaration mentioned was admitted, and
the plaintiff, to maintain the issue on his part joined, offered
George Sweeny, who was admitted to be a notary public for the
County of Washington, District of Columbia, lawfully commissioned
and sworn, and by him they offered to prove that he, as such
notary, was required by the Bank of Washington (who then held the
said note for collection) to demand payment of the note mentioned
in the declaration, and the said note was delivered to him by the
said bank, and he did thereupon, on 4 February, 1840, present the
said note at the said bank and did demand payment thereof at the
said bank, and he was answered by the proper officer of the bank
'that there were no funds there for it'; that he, the said notary,
did, on the next day, to-wit, 5 February, 1840, deliver to the
defendant a notice in writing, which notice being now produced to
the witness by the defendant, is in the words and figures
following:"
"
Notice of 5 February, 1840"
"Washington, February 5, 1840"
" SIR: A note drawn by E. T. Arguelles, dated the 17 May, 1839,
for three hundred dollars, payable at 1-4 February, 1840, due, and
by you endorsed, and for which you are accountable to the President
and Directors of the Bank of Washington, has been this day
protested for nonpayment."
"Your obedient servant,"
"GEORGE SWEENEY,
Notary Public"
"THOS. COOKENDORFER, Esq."
"And he did, also, on the 5 February, 1840, extend and record in
his notarial register the protest of the said note, which is in the
words and figures following: "
Page 45 U. S. 319
"
Protest"
"$300 WASHINGTON, May 17, 1839"
" On the first day of February next I promise to pay to Thomas
Cookendorfer or order three hundred dollars for value received,
negotiable and payable at the Bank of Washington."
" [Signed] E. T. ARGUELLES"
" [Endorsed] THOS. COOKENDORFER"
" ANTHONY PRESTON"
"DISTRICT OF COLUMBIA,
Washington County, sct."
" Be it known that on 4 February, 1840, I, George Sweeny, notary
public, by lawful authority duly commissioned and sworn, dwelling
in the county and district aforesaid, at the request of the
president and directors of the Bank of Washington, presented at the
said bank the original note, whereof the above is a true copy, and
demanded there payment of the sum of money in the said note
specified, whereunto I was answered -- 'There are no funds here for
it.'"
" Therefore I, the said notary, at the request aforesaid, have
protested and by these presents do solemnly protest against the
drawer and endorser of the said note and all others whom it doth or
may concern for all costs, exchange, reexchange, charges, damages,
and interests suffered and to be suffered for want of payment
thereof."
" In testimony whereof I have hereunto set my hand and affixed
my seal notarial, this 5 February, 1840."
"GEORGE SWEENY,
Notary Public"
" Protesting, $1.75"
" Recorded in protest book G.S. No. 3, page ___ ."
"And the said witness further testified that he copied the form
of the said notice from a form used by Michael Nourse, one of the
oldest notaries in the city and largely employed as notary, and
that he made the demand and gave the notice in this case according
to his usual practice, and that his said practice conformed, so far
as he knows and believes, to the practice of the other notaries in
the City of Washington."
"And the plaintiff offered further evidence tending to prove the
said practice of said notaries to be according to the statement
made by Mr. Sweeny, and that the usual practice was, when a notice
was to be sent abroad, to put it into the post office, and date it
on the third or last day of grace, but when the notices were to be
delivered in the City of Washington, a latitude was allowed to the
notary either to deliver the notice on the third or last day of
grace or the day after the last day, and in all cases to date the
notice on the day of its delivery, and the usage is to extend the
protest on the day on which the notice is given, as in this case,
stating the demand
Page 45 U. S. 320
to have been made on the last day of grace, and the protest to
be dated the same day on which the notice is dated."
"And the said George Sweeny, on cross-examination, testified
that he usually acted on behalf of the said Bank of Washington, at
its request, as the notary in regard to notes and bills in said
bank, and that he had given a bond, with security, to said bank, in
the penal sum of $10,000, for the faithful performance of his duty
as notary public in regard to said business, and that the note in
controversy had been deposited by plaintiff in said bank for
collection."
"And the counsel for the defendant objected to the admissibility
and competency of said George Sweeny as a witness, and the court
overruled the said objection and permitted the said Sweeny to be
sworn and to testify as aforesaid to the jury, to which the
defendant, by his counsel, excepted and prayed the court to seal
this bill of exceptions, which is done accordingly."
"And the said counsel for the defendant further objected to the
admissibility and competency of the said testimony upon the subject
of the practice and usage spoken of by the witness, but the court
overruled the objection and suffered the said testimony to go to
the jury, whereupon the said counsel excepted."
"And the said counsel for the defendant thereupon moved the
court to instruct the jury that the said evidence was not
sufficient, if believed to be true, to show that payment of said
note had been duly demanded and refused and that due notice of such
dishonor had been given to defendant so as to bind him."
"But the court refused to give such instruction."
"To each of which rulings of the court, in permitting the
evidence as aforesaid to go to the jury, in refusing the
instruction as prayed, the defendant, by his counsel, excepts and
prays the court to seal this bill of exceptions, which is
accordingly done this 7 April, 1843."
"W. CRANCH [SEAL]"
"JAMES S. MORSELL [SEAL]"
Page 45 U. S. 324
MR. JUSTICE McLEAN delivered the opinion of the Court.
The questions in this case arise on the rulings of the court, to
which, at the trial, exceptions were taken.
Preston, the defendant, as the endorsee of a promissory note,
brought an action against the plaintiff in error, the endorser. The
signatures of the maker and endorser were admitted. These grounds
of error are assigned:
1. That the court erred in admitting the testimony of the notary
public.
2. In refusing the instructions asked by the defendant's
counsel.
3. The declaration is defective.
George Sweeny, the notary who protested the note, testified that
it was delivered to him by the Bank of Washington, who held it for
collection, to demand payment, and that he did thereupon, 4
February, 1840, present the note to the bank, and demanded payment,
but was informed by the proper officer that there were no funds to
pay it, on which he protested the same for nonpayment; and on the
next day, 5 February, he delivered to Cookendorfer, the plaintiff
in error, the following notice, in writing:
"Washington, February 5, 1840"
"Sir -- A note drawn by E. T. Arguslles, dated 17 May, 1839, for
three hundred dollars, payable 1-4 February, 1840, due, and by you
endorsed, and for which you are accountable to the president and
directors of the Bank of Washington, has been this day protested
for nonpayment."
And the witness stated "that he made the demand and gave the
notice according to his usual practice" and "that said practice
conformed, as far as he knows and believes, to the practice of the
other notaries in the City of Washington."
And other evidence was given conducing to show that the usual
practice in such cases was
"when a notice was to be sent abroad, to put it into the post
office, and date it on the third or last day of grace; but when the
notice was to be delivered in the City of Washington, a latitude
was allowed to the notary either to deliver the notice on the third
or last day of grace, or the day after the last day, and in all
cases to date the notice on the day of its delivery, and the usage
is to extend the protest on the day on which the notice is given,
as in this case, stating the demand to have been made on the last
day of grace, and the protest to be dated the same day on which the
notice is dated."
It is insisted that the notary, by reason of his interest in
this suit, is an incompetent witness.
Page 45 U. S. 325
In the case of
Smedes v. Utica Bank, 20 Johns. 372, it
was held that a bank which receives a promissory note for
collection, to charge the endorser, by a regular notice, is liable
for neglect, but this is not the case where the bank delivers the
note to a notary, who is a sworn public officer and whose duty it
is to make the demand and give the notice. The same doctrine is
laid down in 3 Cowen 662. From this it is argued that the notary is
liable directly to the holder of the paper for neglect as a public
officer, and not to the bank as its private agent. That in the
latter case he would not be liable to the holder of the paper, but
might be called on to indemnify the bank which had suffered on
account of his laches.
A notary is a competent witness on the same ground that other
agents are admissible. They are always responsible to their
principals for gross negligence, and yet, from the necessity of the
case, they are competent witnesses to prove what they have done in
the name of their principals.
It appears that the witness, who generally acted as notary for
the Bank of Washington, had given a bond, with security in the sum
of ten thousand dollars, for the faithful performance of his duty
as notary public, in the business of the bank committed to him. But
this, it would seem, does not render him incompetent.
"The cashier or teller of a bank is a competent witness for the
bank, to charge the defendant on a promissory note, or for money
lent or overpaid, or obtained from the officer without the security
which he should have received; and even though the officer has
given bond to the bank for his official conduct."
Greenleaf's Ev. 485;
Franklin Bank v. Freeman, 16 Pick.
535;
United States Bank v. Stearns, 15 Wendell 314.
It is further insisted that if the notary was competent to state
his own acts, he could not prove the usage under which he acted. He
stated that in making the protest and giving notice, he pursued
"his usual practice," "and, so far as he knew, the practice of the
other notaries in the city." Now it would be an exceedingly
technical rule which would permit a notary to say what he had done
in a particular case but prohibit him from stating that he acted in
such case according to his usual practice. And this was all the
witness did say, for although he spoke of his belief as to the
practice of other notaries in the city, he does not state that he
had a knowledge of their practice.
The instruction prayed by the defendant's counsel, and the
refusal of which is the second ground of error assigned, was
"that the said evidence was not sufficient, if believed to be
true, to show that payment of said note had been duly demanded and
refused and that due notice of such dishonor had been given to
defendant, so as to bind him."
In the case of
Renner v. Bank of
Columbia, 9 Wheat.
Page 45 U. S. 326
582, a suit was brought against the endorser of a 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 be
the usage of the bank, and this Court held the demand was made at
the proper time. In
Mills v. Bank of the
United States, 11 Wheat. 430, this Court held
that
"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
Bank of Washington v. Triplett
and Neale, 1 Pet. 25, this Court sanction the usage
to make the demand of payment of a note which was left in the bank
for collection on the day after the last day of grace, placing such
notes, in this respect, on the same footing as notes discounted by
the bank. And that such was the usage in 1817, when payment on the
note or bill in question was demanded, was proved in that case. But
it was also proved, as appears from the record, that the usage was
changed in 1818 by all the banks of Washington and Georgetown, "so
as to conform to the general commercial usage of demanding payment
on the last day of grace." This referred to notes or bills sent to
the banks for collection, and of course embraces all notes not
negotiated in bank.
Where a usage is sanctioned by judicial decisions, it becomes
the law of the place, and no further proof is necessary to
establish it; and it is said, that no evidence is admissible to
controvert the fact, as laid down by the court.
Edie v. East
India Co., 2 Burr. 1221.
Now if the usage, as sanctioned in the cases above cited,
governs this case, it is clear that such diligence has not been
used as to charge the endorser. For under that usage, the demand
should have been made on the day after the third day of grace, when
it was in fact made on the third day of grace.
This objection is met by the defendant in error by the proof of
the usage as stated; which he insists governs all notes not
discounted by the banks of the district. The note in question was
not discounted by the Bank of Washington, it being merely left
there for collection. But it is insisted that this usage cannot be
shown to overthrow that which has been sanctioned by judicial
decisions. A local usage may be changed in the same mode by which
it was established. But parol evidence is not admissible to show
that the usage was different, at the time, from what the courts
have solemnly adjudged it to be. The law merchant is founded upon
custom, and every modification of it by local usage shows that,
like other laws, it may be changed.
The usage proved in this case, except in
Bank of Washington
v.
Page 45 U. S. 327
Triplett and Neale, and that is explained by the
evidence cited, does not conflict with that decided by this Court,
if the latter be limited to notes discounted by the banks, and the
former applies to all other notes payable in the district. In other
words, that the law merchant should be modified by the usage only
as to demand and notice on notes discounted by the banks. And it
would seem from the decisions above cited, the usage to demand
payment the day after the third day of grace had its origin with
the banks, and has not been extended since 1818 to paper not
discounted by them. On all other paper, a demand is made on the
third day of grace, and the
"usage is to extend the protest on the day on which the notice
is given, stating the demand to have been made on the last day of
grace and the protest to be dated the same day on which the notice
is dated."
Now a demand and protest on the last day of grace and a notice
on the following day come strictly within the law merchant. And
this was the diligence used in the present case, except the formal
date of the protest on the day of the notice. No confusion can
therefore, arise from this general commercial usage, as it conforms
to the established law. No inconvenience has arisen, it is
supposed, from the bank usage in the district which has been so
long and so firmly established.
No defects in the declaration are perceived, and none has been
pointed out to us which are not cured by the verdict.
Upon the whole, we
Affirm the judgment of the circuit court with
costs.
