In the case of a protested note, it is not necessary for the
holder himself to give notice to the endorser, but a notary or any
other agent may do it.
The object of the rule which requires the nonce to come from the
holder is to enable him, as the only proper party, either to fix or
waive the liability of endorsers.
Where a note was handed to a notary for protest by a bank and it
did not appear whether the bank or the last endorser was the real
holder of the note, and the notary made inquiries from the cashier
and others not unlikely to know, respecting the residence of the
prior endorsers, and then sent notices according to the information
thus received, it was sufficient to bind such prior endorsers.
If the last endorser was the holder, the cashier of the bank was
his agent for collecting the note, and the evidence showed that in
fact the last endorser knew nothing more than the cashier.
The cases on this subject examined.
The facts being found by a jury, the question whether or not due
diligence was used is one of law for the court.
If due diligence is used in sending the notice to the endorser,
it is immaterial whether it is received or not.
This was action brought by the endorsee (Robinson) against an
endorser (Harris) of a promissory note.
Robinson the plaintiff below, was a citizen of the State of
Tennessee, and Harris a citizen of Alabama.
The note was as follows.
"$1,600 0/00. Eight months after date, we promise to pay Matth.
Burks, or order, sixteen hundred dollars, payable and negotiable at
the Planters' Bank of the State of Tennessee at Nashville, for
value received. Dated in Lincoln county, Tennessee, 20 November,
1837."
"[Signed] JOHN P. BURKS & Co."
"[Endorsed] Matth. Burks, Benj'n D. Harris J. Robinson."
The note not being paid at maturity, Robinson, in September,
1839, brought his action against Harris in the District Court of
the United States for the Northern District of Alabama, which,
after several interlocutory proceedings, came on for trial at May
term, 1843.
The jury, under the instructions of the court, found a verdict
for the plaintiff in the sum of two thousand and sixty-two dollars
and sixty-six cents. It is impossible to give a clear idea of the
instructions of the court without reciting all the circumstances of
the case to which the instructions referred. They are all stated in
the bill of exceptions, which is as follows.
"
The Bill of Exceptions"
"
I
n the District Court of the United States of America"
"
for the Northern District of Alabama"
"In this case, the plaintiff brought his action against
defendant
Page 45 U. S. 337
as endorser of a promissory note, and introduced the deposition
of Alpha Kingsley, which is as follows."
"
Deposition of A. Kingsley"
" The said Alpha Kingsley, being about the age of sixty years
and being by me first carefully examined, cautioned, and sworn to
testify the truth, the whole truth, and nothing else but the truth,
makes oath, deposeth, and saith that he resides in the City of
Nashville in the State of Tennessee, and more than one hundred
miles from Huntsville aforesaid, the place of trial of this cause;
furthermore he saith I am now a notary public of Davidson County in
the State of Tennessee, and was such on 23 of July, 1838, duly
qualified according to the laws of said state; that on that day
there came into my hands, as notary public, a promissory note, a
true copy of which is herewith enclosed, marked A, and is made a
part of this my deposition; that at or about three o'clock of the
said 23 July, 1838, I presented said promissory note at the counter
of the Planters' Bank of Tennessee, at Nashville, where the same
was payable, and demanded payment thereof, and was answered by the
teller of said bank that it would not be paid, whereupon, as notary
public aforesaid, I did protest said promissory note, as well the
drawers as the endorsers thereof, and duly recorded the same in my
notarial book, and on the evening of the said 23 July, 1838, I
deposited in the post office at Nashville, Tennessee, in time to go
by the first mail leaving Nashville after said demand and protest,
notices of said demand and protest, directed to John P. Burks &
Co., Matth. Burks, and Benjamin D. Harris Madison County, Alabama,
to each separately; a copy of the notice so sent to Benjamin D.
Harris is herewith to be enclosed, marked B, and is made a part of
this my deposition. I was not, when these notices were forwarded,
acquainted with the residence of any of the parties thus protested,
or their nearest post office, and I made inquiry of those I thought
were [not] unlikely to know where would be the proper place to
which to direct notices to them; I applied, I recollect, to
Nicholas Hobson, cashier of the Planters' Bank, who informed me
they lived in Madison County, Alabama, but could not say where
their nearest post office was; I also applied to Joseph Estell, who
had resided in Madison County and also had a very general
acquaintance there; he likewise informed me that they all lived in
Madison County, but did not know their nearest post office. I knew
of no other source from whence to derive information as to where to
direct, and accordingly directed said notices 'Madison County,
Alabama,' knowing that, from the general rules of the Post Office
Department, they would be sent to Huntsville, the county seat."
" [Signed] ALPHA KINGSLEY"
Page 45 U. S. 338
"
Copy of Note"
"
(Copy of the note, referred to in Alpha Kingsley's
deposition"
"
as marked A)"
" $1,600 0/00. Eight months after date, we promise to pay Matth.
Burks, or order, sixteen hundred dollars; payable and negotiable at
the Planters' Bank of the State of Tennessee, at Nashville, for
value received. Dated in Lincoln county, Tennessee, 20 November,
1837."
" [Signed] JOHN P. BURKS & Co."
" [Endorsed] 'Matth. Burks, Benj'n D. Harris J. Robinson.'"
"(Copy of the notice, made part of Alpha Kingsley's deposition
-- B)"
"Nashville, 23 July, 1838"
" Mr. BENJAMIN D. HARRIS: "
" Please to take notice that a note drawn by John P. Burks &
Co., payable at the Planters' Bank of Tennessee at Nashville eight
months after date to the order of Matt. Burks, by him, you, and J.
Robinson endorsed, for the sum of sixteen hundred dollars, dated 20
November, 1837, was this day protested by me for nonpayment, and
the holder looks to you for payment as endorser thereof."
" Respectfully, your obedient servant."
"ALPHA KINGSLEY,
Notary Public"
"And defendant introduced the deposition of N. Hobson, which is
as follows."
"
Deposition of N. Hobson"
" Interrogatories to Nicholas Hobson, on the part of the
defendant."
" 1. Were you acquainted with the defendant, Benjamin D. Harris
in the years 1837 and 1838?"
" 2. Do you know whether said Benjamin D. Harris resided in
Tennessee or Alabama, in 1837 and 1838?"
" 3. Have you any recollection of ever telling Alpha Kingsley,
notary public, that the said Benjamin D. Harris resided in Madison
County, Alabama, in 1838?"
" 4. Were you acquainted with the plaintiff, James Robinson? If
so, state where he resided in 1837 and 1838."
" First. I was not acquainted personally with Benjamin D. Harris
in 1837 and 1838."
" Second. I do not know whether said Harris resided in Tennessee
or Alabama in 1837 and 1838."
" Third. I have no recollection of A. Kingsley's having applied
to me in reference to this particular case; he often made
application
Page 45 U. S. 339
to me in regard to the residence of persons living in Alabama; I
know that there are a great many of the name of Harris residing in
Madison County, Alabama, and from the fact of the drawers of the
note living in Madison County, I may have told the notary public
what my belief was as to the residence of Mr. Harris, but not from
any personal knowledge I had of his residence."
" Fourth. I was acquainted with the plaintiff, James Robinson he
resided in Nashville in the years 1837 and 1838."
"[Signed,] N. HOBSON"
"Also, the deposition of Joseph Estell, which is as
follows."
"
The Deposition of Joseph Estell"
"
Question by defendant. Were you acquainted with the
defendant in the years 1837 and 1838?"
"
Answer. I was, and for some time before."
"
Question by same. Do you know whether the defendant
resided in Tennessee or Alabama in 1837 and 1838?"
"
Ans. I understood that he resided in Alabama in 1837
and 1838. I never saw him in Alabama, and how it was that I
understood that he resided in Alabama in these years I cannot now
recollect, but such was my belief of his place of residence."
"
By same. Have you any recollection of telling Alpha
Kingsley, notary public, that the defendant resided in Madison
County, Alabama, in 1838?"
"
Ans. I have no recollection that I ever told Alpha
Kingsley that the defendant resided in Madison County, Alabama, in
the year 1838; Mr. Kingsley has often inquired of us -- that is, of
my brother, while living, and myself -- as to the residence of
persons in Alabama, but my recollection does not serve me as to the
name of any of those about whom he made inquiries."
"
By same. Were you acquainted with James Robinson? If
so, state where he resided in 1837, 1838."
"
Ans. I was acquainted with James Robinson; he resided
in Nashville, Tennessee, in the years 1837 and 1838."
" [Signed] JOSEPH ESTELL"
"Defendant also introduced Joseph Bradley as a witness, who
proved that previous to the maturity of said note, plaintiff had
directed to him at Huntsville, Madison County, Alabama, notices to
all the parties to the note, requesting him to hand them to the
defendant and the other parties, the notices being intended to
remind them when the said note would fall due. Witness directed the
notices to the post offices of the parties respectively, and to
defendant at his post office at Cross Roads, Madison County,
Alabama; but the notices of protest of said note were not sent to
witness; witness acted as plaintiff's friend in the matter; there
was no evidence
Page 45 U. S. 340
to show, that the notary knew who was the holder of the bill, or
where he resided."
"The court instructed the jury, that if they believed that the
notary made the inquiries stated in his depositions, and sent
notice to defendant as therein stated, he being ignorant of his
true residence, that the notice was sufficient to charge the
defendant, and that, under the circumstances of the case as proved,
it was not necessary to make inquiry of the holder of the note as
to the residence of the endorser, to which instructions the
defendant excepts, and prays the court to sign and seal this bill
of exceptions, which is done accordingly."
"WM. CRAWFORD [SEAL]"
Page 45 U. S. 344
MR. JUSTICE WOODBURY delivered the opinion of the majority of
the court.
Under the bill of exceptions in this case, the proper practice
in some important particulars respecting notices of nonpayment of
promissory notes and bills of exchange is involved. It appears that
the defendant was endorser of such a note, and at the trial the
court instructed the jury that if they believed that the notary
made the inquiries stated in his depositions, and sent notice to
the defendant as therein stated, he being ignorant of his true
residence, that the notice was sufficient to charge the defendant,
and that, under the circumstances of the case as proved, it was not
necessary to make inquiry of the holder of the note as to the
residence of the endorser; to which instructions the defendant
excepts.
The substance of the inquiries which were made, as shown in the
depositions, was that the note, being "payable and negotiable at
the Planter's Bank of the State of Tennessee, at Nashville," the
notary, after presenting it and payment being refused, inquired of
those "not unlikely" to know the residences or nearest post offices
of the endorsers, as they were not known to him. He recollects, as
one of whom he inquired, the cashier of the bank, and was informed
by him that Harris lived in Madison County, Alabama, but that he
did not know his nearest post office. The notary made similar
inquiries of a Mr. Estell, who had resided in Madison County, but
was found to be ignorant of the defendant's nearest post office;
and the notary adds, that, knowing "no other source from whence to
derive information as to where to direct" the notice, he
"accordingly directed" this and others "to Madison County, Alabama,
knowing that, from the general rules of the Post Office Department,
they would be sent to Huntsville, the county seat."
The only "other circumstances of the case as proved," to which
the judge probably refers, are, that the name of the present
plaintiff appears on the back of the note as the last endorser;
that he was then an inhabitant of Nashville; and that Joseph
Bradley, a witness for the defendant, testified, that before the
note reached maturity, he, then living at Huntsville, received
notices from Robinson for Harris and the other endorsers,
"requesting him to hand them to the defendant and the other
parties," in order "to remind
Page 45 U. S. 345
them when said note would fall due," and that he directed the
notice for Harris to his post office at Cross Roads, in Madison
County.
It is further stated, as a part of the case, "there was no
evidence to show that the notary knew who was the holder of the
bill, or where he resided."
These being the facts as proved concerning the inquiries and
circumstances to which the judge refers, he properly considered it
a question of law, whether, upon those facts, if believed by the
jury, it was necessary to make inquiry of the holder himself as to
the residence of the endorsers, and whether the notice as given was
in all respects sufficient to charge the defendant.
Bank of Columbia v.
Lawrence, 1 Pet. 583;
Bryden v. Bryden, 11
Johns. 187;
Hadduck v. Murray, 1 N H. 140.
It is to be regretted that some other facts were not agreed or
referred to the jury, such as the distance of the residence of the
defendant, as well as of the Cross Roads post office, from
Huntsville; whether he was accustomed to receive letters at the
former place; and who in truth was the holder of the note at the
time it fell due. But the judge properly submitted to the jury
whatever facts the parties chose to present; and it is usually the
best course thus to submit complicated questions of law and fact,
accompanying them, however, with due legal instructions as to the
rules which ought to govern. 3 Kent's Comm. 107. Then the
instructions can as easily be revised as if the case was withdrawn
from the jury, and, what is very desirable, the rules as to
commercial paper can be preserved as uniform over the commercial
world, and the holders of it have, as they ought to have, a fixed
standard, on a like state of facts, for protecting as well as
knowing their rights. 11 Johns. 187; 1 D. & E. 168; 1 N.H.
140.
The first objection that has been raised under the instructions
or ruling of the court is that the notice does not appear to have
been given by the holder of the note. There is no evidence here to
indicate any person except Robinson or the bank as the holder at
that time, and probably at the trial it was taken for granted to be
one of them, without making any point concerning it to the court or
jury. Whichever it was, there is no pretense but that the notary
came into possession of the note from the agent of the holder
lawfully, and with a view, as agent, to make the demand, and if not
paid to give due notice. When notes are left at banks for
collection, the notaries may often be ignorant of the names of the
holders, as the notes are handed to them by the cashier. He would
as properly do this business when employed by an agent of the
holder, as by the holder himself; and having the note in either of
these ways, he would be competent in law to deliver it up if paid,
or, if not paid, to give notice of that fact to the endorsers. It
has been adjudged, that any agent of the holders may give notice.
Chitty on Bills, 527;
Bank of Utica v. Smith, 18
Page 45 U. S. 346
Johns. 239, in point;
Stewart v. Kennett, 2 Camp. 177,
by Lord Ellenborough, 178; 3 Kent's Comm. 108;
Stanton v.
Blossom, 14 Mass. 116; 7
ibid. 486; 9
ibid.
423.
The agent to collect the note may do it.
Mead v. Engs,
5 Cowen 303; 3 Bos. & Pull. 599; 2 Taunt. 38; 15 East 291; 9
East 347; 1 Camp. 349;
Ogden v. Dobbin, 2 Hall's 112.
And in 9 Yerger 255, it was decided that a notary public is a
suitable agent for this purpose. It was done by a notary of the
agent in 2 Hall, 112.
The meaning of the rule that the holder must give notice is not
that he may not do it by an agent, as any other commercial act, but
that it shall not be given by some other party on the bill not
standing in the relation in which the holder does, and who has no
right to give it and try to make the endorser responsible when the
holder may be willing to waive a resort to him.
Tindal v.
Brown, 1 D. & E. 170; 7 Ves.Jr. 597; 1 Esp. 333. In this
case the notice is express, that "the holder looks to you for
payment as endorser" of the bill, and the notary had the note in
his possession, 11 East 117; 2 Camp. 178, in order to make demand
and give notice in behalf of the holder.
The only remaining questions which are material are, whether any
farther inquiry, and especially of the holder of the note, ought to
have been made by the notary, as to the residence of the endorsers,
before dispatching the notices, and whether the notices sent were
sufficient, considering the information he obtained, and his
ignorance of the true residence of the endorsers. It was a part of
the evidence, that the endorsers lived remote in another state, and
that the notary was ignorant of the exact places of their
abode.
Under such circumstances, he was undoubtedly bound to make
inquiries of persons likely to be acquainted with their residences.
This he did, and, among them, of the cashier of the bank, the
person most likely to be acquainted with the place of abode of
those making paper negotiable and payable at the bank, and of
another person who had lived in the same county with the endorsers,
and not getting entire certainty from either, he sent the notices,
addressed as accurately as his information enabled him, to the
county where they lived, and from the capital of which the notices
would be likely to be forwarded to the endorsers.
This, in most cases, might be sufficient as to inquiry, and
especially where nobody was known to reside near who was able and
bound to give fuller and more accurate information on that subject.
It would usually satisfy a jury that the due diligence had been
exercised which, and which only, the law imposes. Chitty on Bills,
525, 8th Amer. ed; 2 Camp. 461. But it is argued in this case, that
the holder probably lived in Nashville, and could and ought to have
been resorted to on this occasion for such information.
Page 45 U. S. 347
Chitty on Bills 525. This argument is not without force, and
might be insuperable if the notary knew who the holder was, and did
not obtain otherwise all the intelligence on this subject which the
holder probably possessed. But the evidence not showing that he
knew him, did he resort to the holder's agent, and obtain from him
all the information on this point which the holder himself was
likely to have possessed?
Supposing the bank to have been the holder, the cashier, its
agent, was resorted to, and doubtless gave all the intelligence in
possession of the bank on this subject.
But supposing Robinson to have been the holder, which is the
only other probable presumption on the evidence, and which is
contended for by the defendant, and then the cashier was doubtless
his agent to collect the note, and received from Robinson all he
knew as to the residences of the prior endorsers, and communicated
it to the notary when applying to him on the subject. This is not
only the general inference from what would be likely to take place
on such occasions, but is strengthened in this case from the
testimony of Bradley, on the part of the defendant, saying that
Robinson a short time prior, had sent notice to him at Huntsville
for these parties, stating when the note fell due, and that he
requested him to hand them to these endorsers. From this it is
obvious that Robinson supposed they resided in Huntsville, or he
would have sent the notices to a different place; and he would not
probably have desired a resident of Huntsville to hand them to the
endorsers, unless he believed they lived in the same place.
There can be little doubt on this evidence that the real holder
whether the bank or Robinson did give to the cashier all the
information the holder possessed on this subject, and that the
cashier communicated the same to the notary, and that the latter
would have obtained no more had he known and resorted to the holder
in person, and that the cashier, in conforming to this information,
by addressing notices to Madison County, supposing that, by the
rules of the post office department, they would be sent to
Huntsville, the county town, did all which duty required of
him.
Beside the light flung on this subject, and favorable to this
conclusion, by some of the general positions in the authorities
cited at the bar, there are several precedents which bear more
directly on a state of facts such as exists in this case, and which
deserve special notice, as they fortify the correctness of the
views we have presented.
In
Stewart v. Eden, 2 Caines 121, the court ruled that
the holder was bound to inquire no further than a reasonable and
prudent man should, and said, "We do not exact from him every
possible exertion," or inquiry. Only "ordinary diligence" is
required in inquiring.
Catskill Bank v. Stall, 15 Wend.
367. Only "reasonable diligence."
Fisher v. Evans, 5
Binney 543. So in
Chapman
Page 45 U. S. 348
v. Lipscombe, 1 Johns. 294, where a bill was drawn and
dated in New York City, on persons there, and accepted, but
protested afterwards for nonpayment, and it did not appear that the
holder knew where the drawers lived, but sent two notices to them,
one addressed to New York and one to Norfolk, it was held that they
were good, though the drawer in fact lived in Pertersburg.
In that case, inquiry was made at the banks and elsewhere, and
notice was sent in conformity with the information received; but he
did not inquire of the acceptors, who lived in New York, and could
have told him correctly where the drawers lived.
In 3 Kent's Comm. 107 it is laid down, that notice need not
always be sent to the post office nearest to the endorser's
residence.
It suffices, if sent to the nearest which can be ascertained on
due inquiry. And in
26 U. S. 1 Pet.
578, and
27 U. S. 2 Pet.
551, where a notice like this was addressed to the endorser, as
belonging to the county in which he lived, the same rule is
recognized. It is true that there the party in fact resided near
the county seat, or received some of his letters there, about which
there is no particular proof here, but it is said to be proper to
address a notice in that way, "if after due inquiry it is the only
description within reach of the person sending the notice."
It is enough to send the notices to the place where the
information received reasonably requires him to send them. 2 Car.
& Payne 300; 1 Barn. & Cressw. 243;
Bank of Utica v.
Davidson, 5 Wend. 587. If the place it reaches is the wrong
one, he is then not in fault. 5 Yerger 67. All his duty in this
case is to use "ordinary diligence" on the subject, and not to
insure at all events that the notice actually reaches the endorser.
26 U. S. 1 Pet.
582;
35 U. S. 10
Pet. 581.
In
Barr v. Marsh, 9 Yerger 255, it was held that the
holder was not bound or presumed to know where the endorser lived.
But it was enough if the agent of the endorsee or holder made due
inquiry, and directed the notices to the places indicated by the
information, though wrong. It was the best that could be done under
the circumstances.
Nichol v. Bate, 7 Yerger 307;
Dunlap v. Thompson, 5 Yerger 67. Where so many post
offices exist, the residences of parties change so often, and
people live so remote from each other, as in this country, it would
clog the circulation of negotiable paper if the holder or his agent
was bound to know every alteration in the residence of endorsers.
The inquiries were at the bank, and of other persons, in the case
of
Barr v. Marsh, much as in this instance.
In
Sturges v. Derrick, Wightwick Exch. Cas. 77, an
inquiry was made of the son of an endorser as to his residence, and
he did not know it, and the court held, that "sufficient diligence
had been used." And in
Stuckert v. Anderson, 3 Wharton
116, the case itself on examination shows that an inquiry of the
officers
Page 45 U. S. 349
of the bank where the note was discounted is deemed sufficient,
if there be no others near who are likely to know more as to the
residence of the endorsers.
Some cases, it is true, have been more stringent, such as 13
Johns. 434, and 3 Camp. 262; but they do not contradict our
conclusions, as in the first one the notice was sent to a wrong
place quite remote, and the inquiry is said to have been limited;
while in the last, no inquiry was made except at the "house" where
the bill was payable. Most of the cases referred to on this point,
of due diligence in making inquiry, are rather cases as to due
diligence in respect to the time when the notices are sent.
Some of those, as bearing on this, allow a very liberal time to
make inquiries where the residence is remote, 2 Barn. & Cressw.
246; 8
ibid. 393; 2 Dowl. & Ryl. 385; 2 Mood. &
Ry. 359; and only require the notice to be sent as soon as
information is obtained under proper exertion, 1 Barn. &
Cressw. 245; Gow's 81; 2 Camp. 462. And some go so far as to excuse
giving notice at all, if the place of residence at the time is
unfixed, 4 Camp. 285, or cannot be ascertained,
35 U. S. 10
Pet. 580, and
22 U. S. 9
Wheat. 591, before quoted. In the case now under consideration,
then, the conclusion seems well sustained, that reasonable
inquiries were made as to the residences of the endorsers, and
notices promptly dispatched, by a proper agent, in conformity with
the information received. Whether the notices were actually
received or not, and whether, if received, it was not as soon as if
they had been directed to the Cross Roads post office, does not
appear, nor is it material, as the circumstances before mentioned
show due diligence, and thus make out a sufficient case, whether
the notices ever reached the endorsers or not. Let the judgment
below be affirmed.
MR. JUSTICE McLEAN.
I dissent from the opinion of the court in this case with
regret.
The circuit court instructed the jury
"hat if they believed that the notary made the inquiries stated
in his deposition, and sent notice to the defendant, as therein
stated, he being ignorant of his place of residence, that the
notice was sufficient to charge the defendant, and that under the
circumstances of the case, as proved, it was not necessary to make
inquiry of the holder of the note as to the residence of the
endorser."
The note was given by John P. Burks & Co. to Matth. Burks,
for sixteen hundred dollars, in eight months from its date, payable
and negotiable at the Planters' Bank of the State of Tennessee, at
Nashville. It was endorsed by Matth. Burks, Benjamin D. Harris the
defendant below, and also by J. Robinson the plaintiff. The note
does not appear to have been negotiated at the bank. A. Kingsley,
the notary, made a demand of payment at the bank when
Page 45 U. S. 350
the note become due, but it does not appear who delivered it to
him. Notices of nonpayment were directed by the notary to Matth.
Burks and Benjamin D. Harris the two first endorsers, to Madison
County, Alabama.
He did not know where these endorsers resided, but Hobson, the
cashier of the bank, to whom he applied for information as to their
place of residence, informed him that they lived in the above
county and state. Similar information was communicated to him by
Joseph Estell, but neither of these individuals knew the post
offices nearest to the respective endorsers.
Bradley, a witness, stated, that, previous to the maturity of
the note, Robinson directed to him, at Huntsville, Madison County,
Alabama, notices to all the parties to the note, requesting him to
hand them to Harris and the other parties, stating the time when it
would become due. And that witness directed the notices to the
respective post offices of the parties. To Harris he directed the
notice to the post office at "Cross Roads," Madison County,
Alabama.
On this state of facts, the court instructed the jury, "that the
notary was not bound to inquire of the holder as to the residence
of the endorsers."
The notary did not act for himself, but as agent of the holder;
and it was proved that Robinson who appears to have been the
holder, resided in the same town with the notary, and knew the
proper direction for the notices. Now the holder is bound to give
the notice himself, or through his agent, and can he evade the law
by employing an agent who is ignorant of the residence of the
endorser, which is known to himself. He knows where the endorser
resides; is he not then bound to direct the notice as the law
requires? It is a new principle in the law of agency, that the
knowledge of the principal shall not affect him, provided he can
employ an agent who has no knowledge on the subject. The holder is
bound to communicate to the notary all the knowledge he has, so
that the notice may be properly directed. And if this be not done,
and the notice is improperly directed, the holder loses his
recourse against the endorser. This seems to me to be clear of all
doubt.
In the case of
Preston v. Daysson, 7 La. 7, it was
held
"That the holder of a bill or note ought not to avail himself of
the ignorance of the notary as to the residence of the endorsers in
giving them notice of protest; if he knows, he must disclose their
residence, or it seems that his neglect will discharge the
endorsers."
And this is the case now before the court.
There was no proof that the notary knew where Robinson, the
plaintiff below, resided, but it is proved that he lived in the
same town, his name being on the note, and from the fact that the
notary gave no notice to him, as endorser, it is clear that he knew
he was
Page 45 U. S. 351
the holder. In
Hill v. Varrell, 3 Greenl. 233, it was
held "that where the residence of the drawer of a bill is unknown
to the holder, he ought to inquire of the other parties to the bill
if their residence is known to him." And in
Hartford Bank v.
Stedman, 3 Conn. 489,
"where the holder, who was ignorant of the endorser's residence,
sent the notice to A., who was acquainted with it, requesting him
to add to the direction the endorser's place of residence, it was
held sufficient."
"If the holder of a bill uses reasonable diligence to discover
the residence of an endorser, notice given as soon as this is
discovered is sufficient."
Preston v. Daysson, 7 La 7. In
Beveridge v. Burgis, 3 Camp. 262, Lord Ellenborough
said
"Ignorance of the endorser's residence may excuse the want of
due notice, but the party must show that he has used reasonable
diligence to find it out. Has he done so here? How should it be
expected that the requisite information should be obtained where
the bill was payable? Inquiries might have been made of the other
persons whose names appeared upon the bill,"
&c. In
Bateman v. Joseph, 12 East 433,
"In an action by an endorsee against the payees and first
endorser of a bill, it appeared the plaintiff received notice of
its dishonor on 30 September, in time to give notice to the
defendant on that day; he gave no notice, however, until 4 October,
to excuse which, his clerk proved that the plaintiff did not know
the defendant's residence until that day. Lord Ellenborough left it
to the jury, whether the plaintiff had used due diligence to find
the defendant's residence."
In Story on Promissory Notes, 370, note 1, it is laid down
"That merely inquiring at the house where a bill is payable is
not due diligence for finding out an endorser. Inquiry should be
made of some of the other parties to the bill or note, and of
persons of the same name."
And again, in page 368, note:
"To excuse the not giving regular notice of the dishonor of a
bill to an endorser, it is not enough to show that the holder,
being ignorant of his residence, made inquiries upon the subject at
the place where the bill was payable; he should have inquired of
every other party to the bill."
There is no pretense that the bank was the holder of this bill.
For the evidence showed that the notary did inquire of the cashier
of the bank where the endorsers resided. But the court charged,
that, under the circumstances, it was not necessary for the notary
"to make inquiry of the holder of the note as to the residence of
the endorser"; the court, therefore, referred to Robinson as the
holder, and not to the bank. This charge is wholly inconsistent
with the supposition that the note was discounted by the bank, for
then it would have been the holder, and the proper inquiry, as to
the residence of the endorsers, was made of it. The note bears no
marks of its having been discounted. That Robinson
Page 45 U. S. 352
was the holder appears from the notice he gave to the parties
when the note would become due, from the fact that he was not
notified as an endorser, and also that he commenced suit as the
holder, after the dishonor of the note.
The turning point in the case is whether the holder, in failing
to give the proper direction to the notices by this agent, the
notary, is not answerable for the knowledge he possessed of the
residences of the endorsers, which he failed to communicate to the
notary. I care not whether or not Robinson knew the post offices of
the endorsers. He had communicated with them through Bradley, the
witness, and if the notices had been thus sent, the law required
nothing more.
It will be observed, that the cases cited show the duty of the
holder as to giving notice. And it is believed no case has been
reported, except the one cited from Louisiana Reports where it has
been supposed that a principal having knowledge of the residence of
the endorsers could excuse himself from giving notice to them by a
want of such knowledge in his agent. That the notary knew Robinson
was the holder is conclusively shown, as before remarked, by not
treating him as an endorser. His name was upon the note as an
endorser, and he must have understood the purpose for which the
endorsement by him was made.
All the authorities say the holder is bound to use reasonable
diligence to ascertain the residence of the endorser, and when he
attains that knowledge, is he not governed by it? And if so, is he
not equally bound to communicate it to his agent whom he may employ
to give the notice? A denial of this principle will overthrow the
doctrine of notice, as established for more than half a
century.
I think the judgment should be reversed and the cause remanded
for a
venire de novo, in the circuit court.
MR. JUSTICE McKINLEY dissented also.
