Hunter & Keller v. Hook

Headnote

In an action upon a promissory note, against the endorser, the jury were instructed that “if an endorser promises to pay a note, after it has become due, it is a waiver of the failure to make that demand and notice which the law-says the holder of the note ought to make. Therefore if you find that the defendant promised to pay this note, after it became due, the plaintiffs are entitled to recover the whole amount.” Held that this was error. The promise must be made after full knowledge of the omission to make due presentment.

Held, also, that if the charge had contained the proposition that a promise to pay, after maturity, and after full knowledge of the failure to make due presentment, was binding, it would have been unexceptionable.

The maker of a note being an aged man, the endorser, who had married the niece of the maker, took charge of his property. Before the note matured, the maker had assigned or sold all of his property to the endorser, and died, leaving no property, or any one of whom a demand of payment could be made. The endorser, with full knowledge of these facts, went to the holders of the note, prior to its maturing, and told them it would be impossible for him to pay it, when due; asked ’for time; and said if they would wait, he would be sure to pay it. Held, that the making of this promise being established, it was a waiver of presentment, and binding upon the endorser. That it was therefore wholly immaterial whether he promised to pay the note, after maturity. That his liability was established by a promise made before maturity.

PPEAL from a judgment entered upon the verdict of a jury, and from an order denying a motion for a new trial.

On the 3d of November, 1863, William Van Hook gave to the plaintiffs his note for $1,836.47, payable in five years from date to the order of the defendant, and endorsed by him.

The complaint states three grounds on which it is claimed that the defendant is liable as such endorser:

First. That Van Hook, after the making of the note, transferred his property to the defendant, who thereupon agreed with Van Hook to pay the note.

Second. That prior to the note’s becoming due, Van Hook died, and no letters of administration had been taken out, and therefore, there was no one of whom demand of payment could be made.

Third. That the defendant had due notice of nonpayment, and then and afterwards agreed to pay the note.

The court, in charging the jury, said that it was admitted there was no demand of payment and notice to the endorser, and that the question was, whether demand and notice had been waived.

Upon that question of waiver, the court charged that if the endorser asks for time, and, in consequence of that, the note is not presented, that is a waiver of demand and notice ; and that if the endorser promises to pay a note after it has become due, that is a waiver ; and that if the jury should find that the defendant had promised to pay the note after it became due, the plaintiffs were entitled to recover.

On both these points in the charge, exceptions were taken. The jury found a verdict for the plaintiffs for $3,979.35.

I. As to the defendant’s asking for time, &c. 1. There was no evidence in the case of any such re

quest, and that, in consequence thereof, no demand was made or notice given. The omission of demand was clearly in consequence of the death of the maker, and no administration on his estate. 2. The omission to make demand and give notice, “must be fairly attributable to the endorser,” in order to constitute a waiver by the endorser. (Spencer v. Harvey, 17 Wend. 491 . Oswego Bank v. Knower, Hill & Denio. 122.) 3. Neither the death nor the bankruptcy of the maker will dispense with the necessity of due presentment and notice of non-payment. (Story on Bills, § 318. Keeler v. Bartine, 12 Wend. 110 .) 4. Let it be borne in mind, in this case, that there was no averment in the complaint of a waiver of notice for proof of a waiver will not support an allegation of due notice. (Story on Bills, § 320.)

II. As to the promise to pay, after the note became due. 1. There is no such issue in the case. The only averment in the complaint is, that after the defendant had had due notice of non-payment he promised to pay. Thus showing, that by reason of his liability, in consequence of due protest, he made the promise to pay. That would have been a valid promise, and without such averment the complaint would have been demurrable. His liability, perfected thus by such notice, would have been a good consideration for a promise to pay. But without such liability, the promise would have been without consideration and void. (Dean v. Hall, 17 Wend. 214 . Woodworth v. Bank of America, 19 John. 391 .) 2. The rule, as charged by the court, that “if an endorser promises to pay a note after it has become due,” is not law, and was calculated to mislead the jury. A promise by an endorser to pay, made after á ilote falls due, where there has been no demand and notice, or a waiver of them, is not a valid promise. Tet the charge was such that the jury would be justified in finding the endorser was liable on a promise thus made after the note fell due, although there had

been no demand and notice, and no waiver of them. Non constat in this case, that was the reason why the jury found as they did. The charge ought to have been, that if the endorser, after the note was due, and when due demand and notice had been had, or had been waived, had promised to pay, he would be liable. 3. The only other case in which a promise by an endorser to pay will make him liable is, that he, being fully aware that there had been no demand and notice, had made the promise. (Story on Bills, § 280. Chitty on Bills, 535-537. Bayley on Bills, 474, 5th ed. Trim-ble v. Thorne, 16 John. 152 . Tibbetts v. Dowd, 23 Wend. 379 .) (a.) But there is no such promise averred in the complaint, and consequently no such issue in the case. The promise averred, on the contrary, that after due protest, the promise was made. (5.) The charge of the court was not specific enough, but was calculated to mislead the jury, and warrant them in finding for the plaintiffs, even though the defendant did not know of the omission to demand payment and give notice, (e.) The charge would have allowed the plaintiffs to recover in either of the following cases: If the defendant’ s promise had been made after due protest and notice ; or, after a waiver of protest before the note fell due; or, after he knew that there had been no demand and notice; or, where he did not know that there had no been demand and notice. A charge, thus vague and calculated to mislead, is always an error, for which a new trial will be granted. (Carnes v. Platt, 6 Rob. 270 .) For in case of a waiver, in ignorance of the facts, the endorser will not be bound. (Story on Bills, § 320. Jones v. Savage, 6 Wend. 658 .) 4. The plain state of the case then is this, that on an issue whether an endorser was liable on a promise to pay after “due notice of non-payment,” he was held to be liable on a promise to pay when there had been no demand of payment, and that whether the endorser was ignorant of, or

knowing to such want of demand. An admission of liability by an endorser, after maturity,.is never held to be sufficient to overcome the want of demand and notice, without proof that at the time of the admission.the endorser knew that there was a defective" protest. (Gaw-try v. Doane., 48 Barb. 148 .)

I. The questions of fact were settled by the jury, and will not be disturbed on appeal. (Parker v. Jervis, 3 Keyes, 271.)

II. The motion to dismiss the complaint was properly denied. 1. There was a good consideration for the new note, and the defendant’s endorsement, (a.) Giving up the old notes of William Van Hook was a good consideration. (Pr att v. Coman, 37 N. Y. 440 . Brown v. Leavitt, 31 id. 113, and cases there cited. Day v. Saunders, 3 Keyes, 348. Park Bank v. Watson, 42 N. Y. 492 .) (b.) Giving William Van Hook further time to pay the amount due was a good consideration. Forbearance to sue is a good consideration. (Watson v. Randall, 20 Wend. 201 . Farley v. Cleveland, 4 Cowen, 439.) 2. The defendant, by going to the plaintiffs a few days before the note became due, declaring his inability to pay the note, and requesting further time, waived demand and notice. (See cases under third point.) 3. The defendant, by promising to pay the note after the same became due, waived demand and notice. (See cases under fourth point.) 4. William Van Hook was dead when the note became due. His will, if he left any, had not been proven. Ho administrator of his estate had been appointed. There was no one of whom demand of payment could be made. All this was well known to the defendant. He made the request for forbearance, as well" as promise to pay the note, with a full knowledge of these facts. 5. William Van Hook had assigned all his property to the defen

dant. The goods which formed the consideration of the two notes, thereby became the property of the defendant, There was no necessity for demand and notice, under such circumstances. It would have been an idle ceremony. The defendant could not, by any possibility, have been injured by the failure to make demand and give notice. (Story on Prom. Notes, § § 268, 282. Sheldon v. Horton, 43 N. Y. 97 .)

III. The charge of the court that if the defendant, about the time when the note became due, asked for further time and promised to pay it, and in consequence of that the note was not presented, or notice given, that .was a waiver of demand and notice which would entitle the plaintiff to recover, was correct. (Sheldon v. Horton, 53 Barb. 27 ; affirmed 43 N. Y. 93 . Phipson v. Kneller, 1 Stark. 116. Leffingwell v. White, 1 John. Cas. 99. Spencer v. Harvey, 17 Wend. 489 . Bruce v. Lytle, 13 Barb. 167 . Taylor v. French, 4 E. D. Smith, 458. Amoskeag Bank v. Moore, 37 N. H. 539 . Ridgway v. Day, 13 Penn. 208 . Barclay v. Weaver, 19 id. 396.)

IV. The charge of the court that a promise to pay a note after it becomes due, is a waiver of the demand and notice, was correct. He has a light to waive a personal right. Ho new consideration was wanted to make the waiver complete. (Pars. on Notes and Bills, 404, 574. Story on Notes, § 275. Tebbetts v. Dowd, 23 Wend. 379 . Coddington v. Davis, 3 Denio, 17 . Wall v. Bay, 1 La. Am. 312. Barclay v. Weaver, 19 Penn. 398 . Law v. Stewart, 20 Maine, 98. Pierson v. Hooker, 3 John. 68 . Lundie v. Robertson, 7 East, 231. Walker v. Laverty, 6 Munf. 487 . Meyer v. Hibsher, 47 N. Y. 265 .)

V. The words endorsed on the note may be considered as. more than a mere endorsement. They constituted an agreement to pay absolutely, when the note became due, and before that time if the defendant had the ability. In such a case, the obligation of the defendant

is in the nature of a guarantee or joint making of the note, and the strict rules relating to endorsements do not apply. Notipe of non-payment was not necessary to perfect his obligation. In this view of the case, the charge of the court was more favorable than the defendant had a right to demand, and furnishes no ground for reversal of the judgment. (Brown v. Curtiss, 2 N. Y. 225 , and cases there cited.)