Goodwin v. Davenport , 47 Me. 112 ( 1860 )

The opinion of the Court was drawn up by

Rice, J.

The plaintiff claims as indorsee of three promissory notes, signed by one Sleeper, and made payable to the defendant or his order. The notes were indorsed by the defendant in blank, and delivered to the plaintiff after they were over due, in exchange for certain articles of personal property. Twenty-three days after the delivery of the notes, plaintiff made a demand on the maker for payment, which was refused, and the defendant was notified of the refusal the same day.

To charge an indorser on a note negotiated after it is over due, demand must be made upon the maker and notice given to the indorser, within a reasonable time after indorsement. Rice v. Wesson, 11 Met., 400; Sanbourn v. Southard, 25 Maine, 409.

As between indorser and indorsee, such note is to be treated as a note on demand, dated at the time of the transfer, so far as demand and notice are concerned.

There is no precise time when a note payable on demand is deemed to be dishonored. Lossee v. Dunklin, 7 Johns., 70.

Where a note payable on demand is indorsed within a reasonable time after its date, it is held in the United States that the indorsee has all the rights of an indorsee receiving a negotiable instrument before it becomes due. But if not indorsed within a reasonable time, it will be considered as over due and dishonored. Bailey on Bills, 134.

What is such reasonable time, has not been precisely settled ; though it is clear that such a note is to be considered as over due and dishonored in a year, or even eight or nine months after its date; but not over due a few days after its date. Ibid., 136.

What is a reasonable time, is matter of law, to be decided by the Court. Field v. Nickerson, 13 Mass., 131; Freeman v. Haskin, 2 Cains, 368.

In Field v. Nickerson, the period of eight months was held not to be within a reasonable time in which to make demand to charge an indorser; while in Hendricks v. Judah, 1 Johns., 319, it was held that' a note, on demand, drawn in England, and put in suit within one year from its date, was not dishonored.

In Carlton v. Bailey, 7 Fost., N. H., 230, it was decided, that a note payable on demand is presumed to be dishonored after seven months and seventeen days, and in Freeman v. Haskin, 2 Cains, 368, the same result followed in eighteen months; and in Ranger v. Cary & al., 1 Met., 369, such a note was held not to be dishonored at the end of one month.

In England the rule would seem to be not to treat a note payable' on demand as dishonored until a demand of payment and refusal. Barough v. White, 4 B. & C. 325.

Cases are numerous in which this question has, in one form or another been before the Courts, and wherein attempts have been made to establish some definite .and tangible rule by which to determine when this class of paper is to be deemed dishonored. The question has been raised on almost every conceivable period of time, from “ a few days” to eighteen months; but the precise number of days, weeks or months even, which will constitute a “ reasonable time,” has never been, although a question of law, judicially determined, but is made to depend upon circumstances as variable and uncertain as are the transactions and characters of men; and finally to be determined by tbe discretion, not to say, caprice of tbe Court.

Judge Shaw well remarks, in Seaver v. Lincoln, 21 Pick., 267, “that one of tbe most difficult questions presented for tbe decision of a Court of law is, what shall be deemed a reasonable time within which to demand payment of the maker of a note payable on demand, in order to charge the indorser. It depends upon so many circumstances to determine what is a reasonable time, in a particular case, that one decision goes but little way in establishing a precedent for another.”

Eor the purpose of establishing with some degree of certainty, a legal latitude and longitude for this fugacious rule, by which to determine when a note payable on demand may be said to be over due and dishonored, the Legislature of Massachusetts, in 1839, c. 121, § 2, provides that a demand made on any such note within sixty days of its date, without grace, shall be deemed to have been made within a reasonable time.

Similar legislative action, in this State, would relieve the Courts from a class of questions, which, under the conflicting authorities, presents much embarrassment, and would also be of much practical benefit to the business community.

In Sanbourn v. Southard, 25 Maine, 409, the note in suit was indorsed after it was over due.- The indorsement was in blank, and was made on the last of January or first of February, 1839. Demand was made about, or a little past, the middle of March, next following the indorsement, and payment refused, and notice given to the defendant the same day. The Court would not say that the demand and notice were not within a reasonable time.

In view of all the authorities, a few of which only have been cited, we are of the opinion, that the demand and notice in this case were made and given within a reasonable time.

. The defendant offered parol evidence to show that the indorsement was made by him upon the notes several years before they were transferred to the plaintiff, and before they were due, to enable his agent to collect or negotiate them for him, while he was absent in California, and that, by thus indorsing them, he did not intend to render himself personally liable as indorser. Such evidence, if admissible, would not avail the defendant in this case. With that indorsement, the plaintiff was in no wise connected, nor is it material for what purpose it was made. „ So far as these parties are concerned, the transfer took place at the date of the delivery of the notes, and the indorsement, as between them, must be deemed to have been made at the time.

The defendant also proposed to show, by parol, that at the time of the transfer it was agreed between the parties that he should not be personally liable on the notes. This testimony was objected to, as contradicting or varying the legal contract evidenced by the indorsement in writing. Such would be the effect of the proposed testimony, and, for that purpose, it is inadmissible. Sanbourn v. Southard, 25 Maine, 409; Crocker v. Getchell, 23 Maine, 392; Fuller v. McDonald, 8 Maine, 213.

The evidence offered does not disclose any such fraudulent practices on the part of the plaintiff, as will in any way affect his rights as presented by the written contract between the parties. If the defendant did not understand the legal effect of his acts, it was his misfortune or his fault. However that may be, he is bound by them. A default must be entered according to the provision of the report.

Tenney, C. J., and Appleton, Cutting, May, and Kent, JJ., concurred.