Gessner v. Smith — 18 N.Y. St. Rep. 1013

Majority

p. 1013

Marguerite Gessner, Resp’t, v. Mary B. Smith, Appl’t.

(City Court of New York, General Term,

Filed November 23, 1888.)

Headnote

1. Bills and notes—Negotiable paper—Payee of promissory note is FIRST INDORSER.

The payee of a promissory note is the first indorser.

2. Same—Proof of presentation and notice to indorser—Code Civ Pro , § 923—Requirements of.

The requirements of Code Civ. Pro., § 923, providing for putting a party to proof of the presentment, or protest of a promissory note, or bill

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of exchange, are not satisfied hy the service of a copy of the affidavit therein provided for.

3. Same—What necessary to charge indorsee.

Proof of demand for payment and notice of non-payment are necsssary to charge the indorser of a promissory note,

4. Same—Inland paper need not be protested.

A protest of inland paper is not requisite; any person, whether notary or not, may demand payment and give notice of non-payment with the same effect as a notary.

5. Same—Notice may be given by mail to indorser.

Notice of demand and non-payment of inland paper may he given by mail, and, if properly made, charges the indorser, though he does not receive the notice.

6. Same—Effect of notary’s certificate as evidence—When void WHAT NECESSARY.

The official certificate of a notary is presumptive evidence of the fact of presentation and notice of non payment, but if proven untrue these facts must be established by other proof.

Appeal from a judgment for plaintiff, rendered by the court.

The cause was tried without a jury.

Defendant, at her husband’s request, indorsed his note in suit without consideration, whereupon it was delivered (in defendant’s absence) to one Love joy, who passed it to the plaintiff. When due, the note was put into the bank for collection, and ‘ ‘ protested ’’ by a notary for non-payment, who testified on the trial, being called by defendant, that the demand of payment and mailing of notice to the indorser were attended to wholly by his clerk, as the latter reported to him. The notary had no personal knowledge on the subject. No evidence by or from said clerk was offered.

The answer denied the “protest” of said note and the service on defendant of notice of non-payment.

Only a copy of the “affidavit,” prescribed in section 923, Code Oivil Procedure, was served on the part of the defendant, upon the plaintiff’s attorney, and the latter retained-the same.

On the trial the certificate of said notary, in form as required by such section 923, was offered by the plaintiff and received in evidence. Other facts appear in the opinion.

The court decided the cause in the plaintiff’s favor on the ground that, as the notary gave testimony that he heard from his clerk that he presented the note for paymént, and that such clerk mailed the notice of non-payment, this must be accepted as true, because said notary was so testifying as a witness called by the defendant, and that she (defendant) is hound by it.

D. McMahon, for app’lt; L. S. Quackenbush, for resp’t.

Both parties waived a trial by jury. The court below found that the note in suit (payable to the maker’s own order) was indorsed in blank by the defendant before its delivery, with intent to become liable thereon to subsequent indorsers as indorser, and that it was transferred before maturity, and for value, to this plaintiff. The maker, being also payee, was necessarily the first indorser of said note. Phelps v. Visher, 50 N. Y., 69 .

The court further found that the presentment of the note was not made by the protesting notary personally, and that the mailing of notice.of demand and non-payment was also not done by the notary himself.

Annexed to the original answer defendant made and verified her “ affidavit ” that she had not received notice of nonpayment of the note.

But only a copy of this affidavit was served on the plaintiff’s attorney, and not the original affidavit, as required by Code of Civil Procedure, section 923.

The only issue raised was whether the note was duly presented for payment, and the defendant had due notice thereof, and of non-payment. The defendant, said indorser, testified that she never, in fact, received any notice whatever.

The service of a mere copy-affidavit, as aforesaid, instead of the original, is not a compliance with such section 923, and was insufficient. The justice below, therefore, properly admitted the notary’s certificate of demand and non-payment, and of the service of notice thereof on defendant by mail, as presumptive evidence of these matters. This note was inland paper.

The defendant’s indorsement was to be as security for the maker to get him credit. Jaffray v. Brown, 74 N. Y., 394 ; Coulter v. Richmond, 59 id., 478 .

This purpose must be distinctly proven by evidence. That the answer herein, however, admitted. Proof of due demand for payment, and of notice of non-payment, is also necessary to charge defendant as such an indorser.

Any person (whether a notary or not) having a note or bill in his possession, whether it be foreign or inland, may make the demand of payment and receive the amount due, and also give notice of the non-payment, with entirely the same effect as if done by a notary. Cole v. Jessup, 10 N. Y, 100 .

A protest on inland paper is not requisite; but in respect to foreign paper, dishonored for refusal of acceptance or payment, the liability of the drawer or indorsers can only be preserved by a “ protest,” as well as notice. Commercial Bank v Varnum, 49 N Y , 275 Notice alone being required in the case of inland paper.

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And even with respect to foreign paper, evidence is admissible, of a “custom” at the place to present the same by the clerk’s notaries and to protect such paper upon such presentation (id., 277), and the endorser will be thereby bound.

The notice to the endorser of “demand and non-payment ” may now, ordinarily be given through the “ post-office;” and if properly made, the mailing charges the en dorser, although he does not receive the notice. Greenwich Bank v. DeGroot. 7 Hun, 211 ; Miller v. Hackley, 5 Johns., 375 ; Price v. McGoldrick, 2 Abb. N. C., 70 , 75; Bank of Columbia v.Lawrence, 1 Peters, 578, reviewing the subject.

Asno “protest” of the inland paper herein was necessary, and though demand of payment thereof might be by the notary’s clerk and presentation by said clerk was hence, sufficient as the foundation of notice to the indorser of the non-payment, still where the notary’s certificate thereon made is upon its face incomplete or contrary to the statute or is shown to be false, it is incumbent on the holder bringing suit against such endorser to prove the due presentment by such clerk by the latter’s evidence, in addition to proof of due service of notice (Hunt v. Maybee, 7 N. Y , 269 , 270), which authority so held, on a certificate proven untrue, and the trial showing that the presentment was not personally by the notary. A false certificate is no certificate; id., 266. The certificate (which is only presumptive evidence) is null and of no effect, when it appears, by the direct and positive testimony of the notary who issued such certificate, that he did not in person present the note for payment or give the notice to the indorser, but that such was done by some one else, Gawtry v. Doane, 51 N. Y., 90 .

The certificate herein should thereupon have been ignored, as being no evidence to be considered on the question of presentment or notice.

There was no other proof. There should have been evidence either from the clerk himself of due presentation and mailing, or in case he was deceased, from the usual entries by said clerk, made in the notary’s register, kept by the notary or by said clerk for the notary.

This would be competent common-law evidence (id., 90, 91). That would have raised a dispute of facts on the point of notification of the defendant-indorser, she testifying directly she never had notice of non-payment.

Her testimony denying receipt of notice, raises the legal inference that none was given ( 5 Duer, 211 ).

Apart from the notary’s register, the clerk’s own record also would be good evidence of the presentment and other services by him, concerning the inland paper in question herein, if he cannot himself state the facts. It is unimport

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ant whether the entry adduced as proof was made in the notary’s books or in the private memorandum-book of the witness. See Cole v. Jessup, 10 N. Y., 96 ,101.

The mode of proof by means of sucha “ certificate. ” is in derogation of the common law, and must, therefore, be strictly correct. If not so, that is fatal to the certificate. Warnick v. Crane, 4 Denio, 460 , 461. The result must be the same, where it is entirely vitiated by the testimony of its “maker,” proving it to be utterly false.

The certificate having thus become clearly without force or validity, no other “proof” than that appeared. The notary gave the note to his clerk, who merely reportad to him that such clerk had attended to the demanding of payment and the mailing of notice of protest.

Though the notary so testified on his examination as a witness by the defendant, it did not bind the defendant as indorser, for it was not any evidence of anything beyond the fact that said witness received a “report” from the clerk, Robbins v. Richardson, 2 Bosw., 248 ; but as to the truth of such report, it proves nothing.

It was pure “hearsay” on the point of due notice, the defendant not being present. Lanergan v. People, 39 N. Y., 41 . After it was in, it was no “ proof,” whatever, of a demand by any one, or of notification forwarded to defendant by anybody.

The case below presents a failure of proof.

Hearsay evidence, as herein, had no value and amounts to no evidence at all on the facts spoken about in the communication referred to by the witness examined. Harris v. Ely, Selden’s Notes, No. 1, 37 (N. Y. Ct. Appls); Paige v. Cagwin, 7 Hill, 369 ; Moore v. Westervelt, 21 N. Y., 110 . As there is no other support to the decision below, than said hearsay statements from such notary’s clerk, which were plainly incompetent to prove the matters therein mentioned, the judgment for plaintiff cannot be sustained.

The judgment appealed from must, therefore, be reversed, and a new trial ordered, with costs to appellant to abide event.

Ehrlich and Pitschke, JJ., concur.