Majority
p. 86The Commercial Bank of Kentucky, Respondent, v. Joseph B. Varnum, Appellant. (General Term, First Department, July, 1870.)
Headnote
In order to fix the liability of the indorser of a foreign bill of exchange, both the presentation and protest thereof must be by the same notary.And both of these acts must be performed by the notary in person.
The M. bank of H. Y. intrusted to its usual notary, for the purpose of presentation and protest, a bill of exchange drawn on the P. bank of the same place, by a firm at St. Louis, Mo.,and belonging to, and sent to the M. bank for collection by, the plaintiff; the notary procured his partner, also a notary, to make the demand, but made the protest himself. — Held, that the protest was insufficient, and that notice thereof sent to the indorser did not charge him.
• Held, further, that the notary was liable (under 2 R. S., 284, § 48), in an action by the plaintiff for the damages sustained.
It seems, that the plaintiff’s action against the notary was only maintainable under the statute.
It seems, that if the protest is formally “ noted,’’ an actual protest is not necessary before notice, but is sufficient if made before suit brought.
It seems, that a certificate, stating that a note was presented at a time named, payment thereof demanded and refused and the same protested, which runs in the name of a notary who is a partner in the notarial business of the notary who actually made the presentment, &c., and is entered in the firm register by the latter’s direction, and signed by the notaiy named in the certificate, while the other adds his initials upon the margin to signify that he presented the note, is not a legal “ noting of the protest.”
So far as the duty of a notary is determined by statute, or upon authority, evidence of a custom among notaries, contrary to such duty, is inadmissible in evidence to excuse his official action.
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A bill of exchange, payable four months after date, and drawn upon a banking association, or individual banker, is within the statute (Ls. 1857, chap. 416), which abolishes days of grace in certain cases.
This was an appeal from a judgment entered upon the decision of Mr. Justice Mulles, before whom the action was tried, without a jury. The action was commenced in February, 1866.
The plaintiff was a banking corporation, located and doing business at Paducah, in the State of Kentucky. The defendant was a notary public, in the city of New York, and was the duly appointed notary of the Metropolitan Bank, in that city: and employed by it to transact all the business of the bank in the protesting of commercial paper which required the employment of a notary. His arrangement with the bank was, to receive all such paper, and either protest it himself or have it properly protested.
On the 4th day of September, 1860, W. H. Barkesdale & Co., a firm doing business in the city of St. Louis, Mo., drew their draft or check, dated at St. Louis, upon the Park Bank, New York, for the sum of $10,000, payable to the order of John F. Darby, four months after date, as follows:
“ $10,000. St. Louis, Mo., September 4th, 1860.
“ Four months after date, pay to the order of John F. Darby, acceptance waived, ten thousand dollars, for value received.
“ W. H. BARKSDALE, & CO.
“ To Park Bank, New York.”
Darby indorsed the draft, and it was discounted by the plaintiff. The plaintiff sent the draft, properly indorsed by its president, to the Metropolitan Bank of the city of New York, for collection, that bank being the regular correspondent of plaintiff, to whom all its acceptances, and bills, payable in said city, were sent for collection and credit.
On the 5th of January, 1861, on which day the draft became payable, it was received by the defendant from the Metropolitan Bank, for demand and protest. The defendant
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was at that time in partnership with P. W. Turney, in the law and notarial business, and the firm were also the attorneys of the bank. Mr. Turney was also a notary public, and their fees as notaries were shared equally between them. On the 5th of January, 1861, some fifty other notes and bills were also delivered to defendant for demand and protest, and he was unable to present or give his personal attention to all of them. He hánded the draft to Mr. Turney, who presented and demanded payment of the same at the Park Bank. Payment was refused; and on the same day Mr. Turney caused an entry in the protest register of the firm, to be made by one of the firm clerks, adding his own initials (to signify as he testified that he presented the draft) upon the margin, which was signed by the defendant, and was as follows, viz.:
“ State New York, ) City and County of New Pork, \ ss'
“On the fifth day of January, in the year one thousand eight hundred and sixty-one, at the request of The Metropolitan Bank,. I, Joseph B. Varnum, Jr., a notary public for the city and county of New York, did present the original [P. W. T.] draft, of which, the above is a copy, to the cashier, of the Park Bank in said city, being the place where the same is payable, and demanded payment thereof, which was refused; whereupon I duly protested the same for non-payment.
“Hotice of said protest was given as follows : January 7th, mailed to L. M. Flournoy, Pt., Paducah, Ky., to all parties, and duplicate to drawers, St. Louis, Mo.
“ J. B. YARHUM, Jb.,
“ Notary Public.”
On the same, or the next day, the defendant made out a certificate of protest, and notices for the drawers and indorsers, and sent the same by mail to the plaintiff at Paducah, and to Barkesdale & Co., at St. Louis. The notice for the indorser, Darby, was sent to the plaintiff.
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On the 7th day of January, 1861, the draft was mailed by the cashier of the Metropolitan Bank to the plaintiff at Paducah, and about or nearly a month after the date of the notice, it was received by Darby, the indorser, through Barkesdale & Co. The drawers were insolvent in January, 1861, but Darby, the indorser, was solvent. The plaintiff brought suit in the Common Pleas of St. Louis against the drawer and indorser, and the court discharged the defendant from' liability upon the ground, that the defendant did not personally present the bill for payment, and that the acts of Turney did not amount to a protest. ( 36 Mo., 563 .) While that suit was pending, and before its trial, a certificate of protest in due form, was made by Mr. Turney, as notary public, and delivered to the attorneys for the plaintiff, and Messrs. Varnum and Turney, wrote to said attorneys, advising them of the usage in the city of New York, to present and demand bills by the clerks of notaries, etc. Evidence offered to establish a custom in the city of New York, to treat bills of exchange drawn upon persons in this State from other States of the Union as inland bills, and protest them upon presentation by notaries’ clerks, was excluded by the court under defendant’s exception. The defendant’s counsel offered to prove a universal usage and custom in the city of New York among all persons connected with or transacting business with bankers or banks therein, and with the notaries public therein to protest all bills of exchange, foreign or inland, and promissory notes, upon the presentment or demand of payment by a clerk or agent of the notary employed, &c. The court refused to receive the evidence, and defendant’s counsel excepted.
The court held in substance that defendant was liable for the whole amount of the bill, under the provisions of the statute (2 R. S., 284, § 48), declaring a notary liable for misconduct in his office to any party injured thereby; that the instrument was a foreign bill of exchange; that it must have been personally presented and demanded by defendant and protested by him; that the acts of Turney did not amount to
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a valid protest of the bill; that defendant was guilty of misconduct within the meaning of the statute for not presenting and demanding the bill in person. The defendant duly excepted to both the findings of fact and conclusions of law. [For opinion of Mr. Justice Mollist, see[1] .)
p. 91
H. E. Davies, and Noah Davis, for the appellant,
insisted with other points, as follows:
The defendant owed no duty to the plaintiffs in respect to the discharge of his duty in reference to the protest. He
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was employed by the Metropolitan Bank, and no privity of contract existed between him and the plaintiffs. The Metro
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politan Bank was the agent of the plaintiffs for the collection of the check, or draft, and liable to them for any negligence
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or default in the discharge of that duty by the said bank, as the agent of the plaintiffs, or for the default or negligence of
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any sub-agent employed by said bank in and about said business, citing Allen v. The Merchant's Bank ( 22 Wend., 215 );
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id., 15 Wend., 486 ; Bank of Orleans v. Smith ( 3 Hill., 562 ); Montgomery County Bank v. The Albany City Bank
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( 8 Barb., 396 ); 3 Seld., 459; Bank of Orleans v. Smith ( 3 Hill., 562 ); Commercial Bank of Penn. v. The Union Bank
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(1 Kern., 311); Denney v. The Manhattan Co. ( 2 Denio. 115 , and 5 id., 639); Calvin v. Hobrook (2 Coms., 126); Draper
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v. Arnold ( 12 Mass., 450 ); Hoard v. Garner (3 Sand. S. C., 179); Thompson v. The Bank of S. Carolina ( 3 Hill., S. C., 77 ); Amer. Express Co. v. Egbert (21 Indiana, 4); Reeve v. The State Bank of Ohio ( 8 Ohio, 465 ); Tyson v. The State
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Bank of Indiana ( 6 Black., 225 ); Abbott and others v. Smith ( 4 Ind., 452 ); Bac. Abr. Tit. Sheriff, H. 4; Gilbert v. Luce ( 11 Barb., 91 ); Camen v. Reynolds (Cowp., 403).
The rule of liability has not been changed by the statute (2 R. S., 284, § 48), and made the defendant, as a notary, liable in this case.
1st. Because if applicable, the party injured was well defined in law, as the person to whom the agent owed the duty.
2d. Because the statute was not applicable, the defendant not being chargeable with official misconduct within its meaning, for a mere omission to do an official act arising from misapprehension of the law, and not in itself criminal either because of intentional departure from official duty, or willful refusal or neglect to perform an official act, citing Turnbull v. Martin ( 37 How. P. R., 20 ); Smith v. Cutler ( 10 Wend., 589 ); Ketchum v. Woodruff ( 24 Barb., 149 );
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Cranston v. Exrs. of Kenny ( 9 John., 212 ); Herrick v. Blair (1 John. Ch., 101); Chase v. Westmore (13 East, 357); Ex party Garland (4 Wallace, 333); Waters v. Whitman ( 22 Barb., 595 ).
The evidence of a custom, as offered, should have been admitted to prove an absence of intentional misconduct, and it was sufficient, if upon a doubtful question an agent followed the prevailing practice. (6 Metcalf, 26 ; Chapman v. Walton, 10 Ring., 57; Levich v. Meigs, Cow., 645; Lease v. Frenben, 11 East, 348.)
The bill was not due at common law until the 7th of January, and a demand and protest on the 5th of January was nugatory, unless the bill was within the act abolishing days of grace (Ls. 1857, ch. 416; Griffin v. Goff, 12 John., 423 ), and no right of action could arise from non-performance of a nugatory and ineffective act. The statute being in derogation of the common law, must be strictly construed. Only such bills, &c., as appear “ upon their face ” to be payable on a specified day, or in a specified number of days after date, were within the statute, but where computation is necessary dehors the bill to ascertain the number of days, the statute had no application.
The protest by Turney was sufficient, a note thereof having been made in his protest book on the same day, though the protest was subsequently drawn up, citing 3 Kent Com., p. 93; Chitty on Bills, 477; Story on do., § 302; Charter v. Bell (4 Sup., 48); Orr v. Maginnis (7 East, 359); Rogers v. Stevens (2 T. R., 713); Robbins v. Gibbins (1 Maule & S., 271); Cayuga Co. Bank v. Hunt ( 2 Hill., 635 ); Bailey v. Dozier ( 6 How., 23 ). And the protest, it seems, may be drawn up after suit (Brooks Notary, 97), citing also Cofferthwait v. Sheffield (1 Sand. S. C., 449); Mechanics' Bank v. Merchants' Bank (6 Metcalf, 13); Chitty on Bills 333, and Am. ed., page 464, notes; Holliday v. Martinett ( 20 John., 168 ); Brooke on the Office of Notary, 100 ; Commercial Bank of Ky. v. Varnum ( 36 Mo., 563 ); Cayuga Co. Bank v. Bennett, 5 Hill, 238 ; Story on Bills, § 302, note;
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Byles on do., 203, 204; Hart v. Wilson ( 2 Wend., 513 ); Leftley v. Mills (4 T. R., 175); Bank of Rochester v. Gray ( 2 Hill, 227 ).
They insisted also, upon the validity of the protest as made by the defendant, claiming that he was not compelled by law to make demand of payment in person, and reviewed at length the cases supposed to hold a contrary doctrine, viz., Leftley v. Mills (4 T. R., 170); Onondaga County Bank v. Bates ( 3 Hill, 53 ); Cole v. Jessop ( 9 Barb., 395 ); Sheldon v. Benham ( 4 Hill, 131 ); Gantry v. Doane ( 48 Barb., 155 ); Warwick v. Crane ( 4 Denio, 465 ); Hunt v. Maybee (3 Selden, 266); and citing to this point also, Chitty on Bills, 8th ed., 492 to 497; Brooke on Notaries, 66, 176,530 ; 1 Parsons on Bills, 359 ; McClane v. Fitch ( 4 B. Mon., 599 ); Nelson v. Fotteral (7 Leigh. R., 179) ; 3 R. S., 473, 5th ed., §§ 32 to 35 inclusive.
To the point that it was error to exclude evidence of a usage of notaries in New York city, to make demand through their clerks, they cited Chitty on Bills, 493, &c.; Brooke on Notaries, 66; Remer v. Bank of Columbia ( 9 Wheat., 581 ); Mills v. Bank of U. S. ( 11 Wheat., 431 ); Bank of Washington v. Triplett ( 1 Pet., 25 ); Merchants' Bank v. Woodruff ( 25 Wend., 674 ); S. C., 6 Hill, 174 ; Kilgore v. Bulkley ( 14 Conn., 372 ); Cubbs v. Adams ( 13 Gray, 397 ); 1 Greenleaf Ev., §§ 292 and note, 488; 2 do., § 279; Hinton v. Locke ( 5 Hill., 437 ); Dalton v. Daniels ( 2 Hill, 472 ); Bowen v. Newell (4 Seld., 190); S. C., 2 Duer, 584 ; S. C., 3 Kern., 290; Kilgore v. Buckley ( 14 Conn., 362 ); Otsego Co. Bank v. Warren ( 18 Barb., 290 ); Mechanics' Bank of Baltimore v. Merchants' Bank of Boston ( 6 Met., 13 ); Warwick v. Crane ( 4 Denio, 460 ); Bank of Rochester v. Gray ( 2 Hill, 227 ); Nelson v. Fetteaie ( 7 Leigh., 179 ); Sacrider v. Brown (3 M. L., 243); Mittenberger v. Spauldiny (33 Missouri, 421); Cubbs v. Adams ( 13 Gray, 397 ); Edward’s on Bills, 508, and cases; Story on Notes, § 222, on Bills, § 34 ; Hinton v. Lock ( 5 Hill, 437 ); Outwater v. Nelson ( 20 Barb., 29 ); Wadsworth v. Alcott ( 6 N. Y., 64 ).
p. 103
W. C. Barrett, for the respondent,
contended among other matters, that the defendant could not delegate his powers as a notary to another, and that the notary who presents a bill must protest it, and cannot depute another to perform either act, and that the note not having been personally presented by the defendant the protest was void, citing Story on Agency, § 14; Ess v. Truscott (2 Mees. & W., 385) ; Powell v. Tuttle ( 3 N. Y., 396 , 407); Newton v. Bronson ( 13 N. Y., 593 ); Onondaga Bank v. Bates ( 3 Hill, 53 ); Chenowith v. Chamberlain ( 6 B. Mon., 60 ); Charmichael v. Bank of Penn. (4 How., Miss., 567); Sacrider v. Brown (3 McL., 48); Coml. Bank v. Barksdale ( 36 Mo., 563 ).
As to the inadmissibility of the evidence of custom he cited, Allen v. Merchs. Bank ( 15 Wend., 482 ); Edie v. East India Co. (2 Burr., 1216); Bowen v. Newell ( 8 N. Y., 190 ); United States v. Buchanan (8 How. U. S., 83, 102); Beirne v. Dord ( 5 N. Y., 102 ); Otsego Bank v. Warren ( 18 Barb., 291 ); Suydam v. Clark ( 2 Sandf., 133 ); Brown v. Jackson ( 2 Wash. C. C., 24 ); Cox v. Haisley ( 20 Penn. St., 245 ).
To the point that the evidence of custom was insufficient, as not being either reasonable, known to the plaintiff, or uniform or general (Civil Code, § 2021, and cases cited); Bowen v. Stoddard ( 10 Metc., 30 ); U. S. v. Buchanan (8 How. U. S., 102); Cafe v. Dodd ( 13 Penn. St., 33 , 37); Lewis v. Marshall (7 M & G., 745).
To "the point that the defendant was guilty of official misconduct, Adsit v. Brady ( 4 Hill, 630 ); Robinson v. Chamberlain ( 34 N. Y., 389 ); Newell v. Wright ( 3 Allen, 171 ); Henley v. Lyme Regis (5 Bing., 91); Clark v. Miller ( 47 Barb., 38 ); Phillips v. Commonwealth ( 44 Penn. St., 187 ); 2 R. S., 284, § 48.
To show that the defendant was liable to the plaintiff, he cited Faben v. Mercantile B’k ( 23 Pick., 332 ); Warren Bank v. Suffolk Bank ( 10 Cush., 582 ); East Haddam Bank v. Scorvier ( 12 Conn., 30 ); Bellenoie v. Bank of U. S. ( 4 Whart., 105 ); Jackson v. Union Bank (6 Harr. & J., 146); Citizens'
p. 104Present — Ingraham, P. J., Cardozo and George G. Barnard, JJ.
Bank v. Howell ( 8 Md., 530 ); Tieman v. Coml. Bank (7 How., Miss., 648) ; Bowling v. Arthur ( 34 Miss., 41 ); Baldwin v. Bank of La. (1 La. Am., 13); Frazier v. New Orleans Gas Co. ( 2 Rob., La., 294 ); Agricultural Bank v. Coml. Bank (7 Smedes & M., 592); Ætna Ins. Co. v. Alton Bank ( 26 Ill., 243 ); Allen v. Merchs. Bank ( 22 Wend., 215 ); S. C., 15 id., 482; Amer. Express Co. v. Egbert ( 21 Ind., 4 ); Raney v. Weed ( 3 Sandf., 584 ); Phelps v. Wait ( 30 N. Y., 78 ); Foster v. Preston ( 8 Cow., 198 ); Story on Agency, § 201, 217a.
By the Court —
It was properly conceded on the argument that the draft sued on is a foreign bill, and that in order to charge the indorser, presentment and protest in case of non-payment, must be made by a notary public.
In addition to the authorities mentioned in the opinion of judge Mullin, reference may be made tb Brooke on the office of notary public, pages 69 and 133.
Mr. Turney being a notary, could of course have presented the draft, and upon its non-payment might have made the protest. The trouble is, that he did not. He presented the draft, but he did not do what was necessary in respect to a foreign bill upon payment being refused. He neither drew up the formal protest, nor made a note or minute upon the face of the bill, sometimes termed an incipient protest, which-last mentioned act would have been sufficient if he had made up the formal protest before suit brought. (Brooke, p. 72.)
What Mr. Turney did, is therefore, of no consequence, because it is quite too late to assert that any part of the official duty of a notary can be delegated. (Onondaga Bank v. Bates, 3 Hill, 53 .)
When the instrumentality of a notary, as in respect to a promissory note or inland bill, is not indispensable, and as to which the functions which he ordinarily exercises may be per
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formed by any individual with equal effect as if done by a public officer, it only becomes a question of requisite proof on the trial (Gawtry v. Doane, 48 Barb., 155 ); but that does not apply to the case of a foreign bill in respect to which the action of a notary is needed in order to fix the liability of the indorser.
The law having determined what the duty of a notary in regard to a foreign bill is, evidence of a custom among notaries contrary to that duty was inadmissible. The cases cited by Justice Mullet, render further examination of that subject unnecessary.
Whatever may be said of the right of the plaintiff to maintain this action independent of the statute (3 R. S., 5th ed., 474, § 37), in regard to which I fully concur with Judge Mullin, I think there can be no doubt of their right to sue the defendant under the statue upon the ground of official misconduct. He was a public officer, and undertook to perform an official duty and neglected it. That is misconduct, for which an action lies.
There is no force in the objection that section two of the act of April 14, 1857 (S. L. 1857, chap. 416), does not cover such a bill as the one in question.
The act plainly meant to provide that days of grace should not attach to a draft appearing on its face to be drawn on a bank whether payable on a day expressly designated or to be ascertained by mere calculation.
There was no error committed on the trial, and the judgment below must be affirmed.
Cases cited
- Denny v. Manhattan Co. 2 Denio. 115 p. 98