Brown v. Wilson

23 S.E. 630, 45 S.C. 519, 1896 S.C. LEXIS 10

• Court: Supreme Court of South Carolina
• Decided: January 9, 1896
• Status: Published

Opinions

The opinion of the Court was delivered by

Acting Associate Justice Earle.

This is an action on a promissory note made by Abbeville Manufacturing Company to Wilson & McNeill, the defendants above named, and endorsed by them to the plaintiff. George S. Wilson and John McNeill were partners, trading under said firm name of Wilson & McNeill. George S. Wilson was alone served with the summons and complaint herein.

The cause was heard by his Honor, Judge Buchanan, and a jury, and a general verdict was rendered against the defendants for the amount due upon said note, and judgment has been entered thereon against the said George S. Wilson.

Erotn this judgment he appeals to this Court upon exceptions to his Honor’s charge to the jury, and upon his refusal to charge certain requests submitted by appellant, which will not be set forth in this opinion; but the exceptions, and also the report and charge of his Honor, the Circuit Judge, will appear in the report of this case.

1 As to the first exception: His Honor refused the second request to charge, as submitted by the appellant; but charged the jury: “If the agreement was part and parcel of the transaction leading up to the endorsement, that the endorsement should be signed, then the endorsement is as much a part of the transaction as anything else.” We findsno error here. If the note payable to order is delivered for value without endorsement, the holder would have the equitable title to the note, and by proper proceedings could compel the proper endorsement to be made according to the agreement of the parties (Story on Bills, sec. 201). If the endorsement should be made after delivery, in pursuance of a prior arrangement, this is no reason why such endorsement would not be binding upon the endorsers. This exception is, therefore, overruled.

2 The second exception is overruled upon the same ground. If Wilson omitted to endorse the note when it was delivered to Brown for value, then he was in duty bound to endorse it upon demand; and if such demand was made upon his clerk, who endorsed it without authority, and, upon being notified of the same by Brown, he replied, “It is all right,” this was a ratification of the endorsement made by his agent.

3 The third exception is also overruled. His Honor, in his charge to the jury, stated in substance the sound proposition of law, that if an agent performs an act according to his usual course of dealing, and the act is thereafter ratified by the principal, it will be binding upon the principal.

4 The fourth exception makes the point that a new trial should have been granted upon the ground that the verdict was against all of the defendants named upon the record, whereas only the appellant was served with the summons and complaint. This exception will not avail the party who was duly served, although the judgment would have been void against the defendants -who were not served. It is a good judgment against the appellant, and even though it would have been void against the other defendants, if it had been entered up in conformity with the verdict, the appellant cannot assign for error matters that do not prejudice him, but affect other parties who are not before the Court. Besides, the Code of Procedure, sec. 286, provides that: “Upon receiving a verdict the clerk shall make an entry in his minutes specifying the time and place of the trial, &c. * * * If a different direction be not given by the Court, the clerk must enter judgment in conformity with the verdict.” But we find from the report of his Honor, that when it was brought to his attention by counsel for the appellant, that although only the appellant was served, the verdict was against the defendants, and judgment would be entered against all, the counsel for the plaintiff stated, “that so far as the entry of judgment against all was concerned, he would not enter up judgment against all;” and in this his Honor seems to have acquiesced. There seems, then, to have been a tacit understanding that the judgment should be entered up oply against the appellant; and we think that while there was no formal order signed by the Judge to that effect, what did occur was sufficient direction to the clerk to enter judgment as proposed by the plaintiff’s attorney.

5 The fifth exception complains of error on the part of the Circuit Judge in refusing to set aside the verdict, upon the ground that the jury refused to follow his directions. It is true, that when a jury disregards the instructions of the Court, the verdict should be set aside, even if the instructions were clearly erroneous (Dent v. Bryce, 16 S. C., 1); but it does not appear to our satisfaction, that the verdict is not responsive to the charge of his Honor; the presiding Judge. All of the testimony is not before us, and his Honor says, in his report, that the verdict “was responsive to the evidence, which was sufficient to sustain it. * * * I believed then, as I do now, that the verdict of the jury was substantially right and proper. Believing this, I could not set it aside and grant a new trial upon the ground that the verdict was not responsive to the charge.” Besides, it is not our province to review the facts or to decide upon the sufficiency of testimony in a law case. This exception is, therefore, overruled.

The seventh exception is overruled for the reasons stated as to the first and second exceptions.

As to the sixth exception, it does not appear in the “Case” that any “demurrer and motion to dismiss the complaint” was made by the appellant, and, under the well established rule, it is not incumbent upon this Court to consider matters which appear only in the exceptions. But as it has been earnestly requested by counsel that we intimate an opinion as to whether or not it is necessary to protest a promissory note, in order to bind an endorser, we will not decline to do so, especially as this may be a matter of some public interest.

6 It is clear, that at common law, it was never deemed necessary to protest a promissory note. Judge Story, in his work on Promissory Notes, sec. 297, says: “But in cases of promissory notes, by the English and American commercial law, no protest is required to be made upon the dishonor thereof.” In Burke v. McKay, 2 How. Sup. Ct. Rep., 71, Mr. Justice Story, as the organ of the Court, said: “In the first place, by the general law merchant, no protest is required to be made upon the dishonor of any promissory note, but it is expressly confined to foreign bills of exchange. This is so well known that nothing more need be said upon the subject than to cite Young v. Bryan, 6 Wheat. R., 146, where the very point is decided.” In Yoimg v. Bryan, Chief Justice Marshall, in delivering the opinion of the Court, says, that all that was incumbent upon the holder of a promissory note was to give due notice to the endorser; that no protest of a promissory note or inland bill of exchange was necessary. Is such protest necessary under the statute? The statute of 3 and 4 Anne, c. 9, was made of force in this State in A. D. 1712, and is now incorporated in the General Statute of 1882, sections 1290, 1292, 1293, 1294, and 1295 (1393, 1394, 1395, 1396, Rev. Stat.); and it is contended by counsel that such protest is necessary under the terms of this statute. Ret us inquire, in the first place, what interpretation was given to this statute by the English Courts; and, in the second place, how it has been construed in this country.

Mr. Chitty, in his work on Bills, p. 500, says: “The Act only gives an additional remedy, and does not take away the common law one; and, therefore, it is not necessary to protest, it being in all cases of inland bills sufficient to give notice of non-payment; and the holder can claim interest from the drawer, although there is no protest.” And the same author says, at pages 364, 365: “At common law, no inland bill could be protested for non-acceptance, but by Statute 3 and 4 Anne, c. 9, s. 4, a protest was given, in case of refusing to accept in writing any inland bill amounting to the sum five pounds, expressed to be given for value received, and payable at days, weeks or months after date, in the same manner as in the case of foreign bills of exchange, and for which protest there shall be paid two shillings and no more. It has been supposed that this protest must be made, in order to entitle the holder to demand of the drawer or endorser costs, damages and interest; but in practice the plaintiff recovers interest against the drawer or endorser of an inland bill, on prooE of due notice, without proving protest; and it has been recently decided that a protest is not essential to the recovery of interest. If the bill be of the above description, and under the amount of twenty pounds, the holder is certainly entitled to the above accumulative remedy, though no protest was made.” Winkle v. Andrews, 2 Bar. & Ald., 696, was an action against a drawer of an inland bill, and a rule nisi was obtained to strike out the interest from the verdict, on the -ground that there had been no protest; but upon showing cause, the Court held that the want of a protest afforded no ground for disallowing interest, where notice of dishonor of the bill had been duly given; that the object of the Statutes 9 and 10, W. Ill, and 3 and 4 Anne, c. 9, s. 4, was to give interest, damages and costs, in cases in which it was supposed that they were not recoverable at common law, not to deprive a plaintiff of them in any case in which the common law would give them; that the fifth section, containing the words of deprivation, was by way of proviso only, to qualify the additional benefit that the Statutes of Anne and William III. were supposed for the first time to give; that the proviso in the eighth section contained words to secure the plaintiff all his common law rights, and that the right to damage was a common law right; that it was upon this principle only that the constant allowance of interest, when there had been no protest, could be explained; that the fifth section contained words to annul parol acceptances. And in Rex v. Meggott, Eyrie, C. J. of K. B., held that they had that effect; that that notice was corrected in Lumly v. Palmer, 2 Stra., 1000, upon the principle now adopted by the Court; that the fifth section of 3 and 4 Anne, c. 9, deprived a party of no remedy he had at common law; that that case must be considered as having virtually overruled Harris v. Benson, 2 Stra., 910, Trinity Term, 5 Geo. II.; and from that time, from anything which appears to the contrary, parol acceptances had been held binding, and interest had been allowed against the drawers and endorsers of all inland bills; but no instance could be shown in which any such bills had been protested. (Bayley on Bills, 5 ed., 263, n. 9.)

Upon this subject Chan. Kent, in his Commentaries, 3 vol., p. 93, says: “On inland bills no protest was required by the common law, and it was made necessary in England in certain cases by the Statutes 9 and 10 Wm. III. and 3 and 4 Anne; and yet, notwithstanding the language of the statutes, it had long been the settled rule and practice not to consider the protest of an inland bill as necessary or material.” To the same effect is Dan. on Negotiable Instruments, vol. 2, pp. 1 and 2. The statute of Mississippi is similar to ours, and concerning that statute the Supreme Court of the United States, in the case of Bailey v. Dozier, 6 How., 29, said: “The statute of Mississippi is taken, substantially, from 9 and 10 Wm. III., c. 17, amended by the 3 and 4 Anne, ch. 9, under which it has always been held by the courts of England, that the action at common law was not thereby taken away, but that an additional remedy was given, by which the holder could recover interest and damages on an inland bill, in cases where he was not entitled to them at common law; and if he chose to waive the benefit of the statute, he might still recover the amount due on the bill, by giving the customary proof of default and notice (2 Ed. Ryam., 992; s. c., 1 Salk., 131, 6 Mod., 80; 2 Bar. and Aid., 696; Chitty on Bills, 466).” In Fleming v. McClure, 1 Brev., 433, the Court said: “The custom among merchants with us, in regard to bills of exchange, is the same which exists in England, as to protests and notices of non-acceptance and non-payment, and must be governed by the same rules. * ■* *. In the case of foreign bills, a protest is universally necessary, whether for non-acceptance or non-payment; It is an essential part of the custom of merchants, and is requisite, not merely on account of damages and interest, but also on account of the principal sum. In respect to inland bills, it is only necessary on account of damages and interest, and is founded on the statutes of 9 ánd 10 Wm. III., c. 17, and 3 and 4 Anne, c. 9.” ,.

In the case of Payne, endorsee of a promissory note, v. Joseph Winn, endorser, 2 Bay, 374, it was held that “the want of a formal protest by a notary, in this case, was no bar to the plaintiff’s recovery against the endorser. A protest does not raise any new debt or create any further responsibility on the parties to a bill or note, but only serves to give formal notice that a bill or note is not accepted or paid. This protest, by common law, is absolutely necessary on every foreign bill of exchange, but it is not necessary on any inland bill of exchange, either by the common law or by any statute of force in this country, except to entitle a party to interest and damages.” In Thompson v. Bank, Riley’s Raw Cases, 81, the Court said: “The question here arises on a promissory note; protest for non-payment is not necessary; it is altogether superfluous. A demand of payment was necessary, and to enable it to be proved it is necessary to employ some one to make it, but a notary was not requisite; any other individual would have sufficed to make the demand, or to make the inquiries necessary to giving notice.”

We, therefore, hold that it is not necessary to protest a promissory note in order to make the endorsers liable, unless the note is made by a person residing in one State and payable to a person residing in another State. In that case, it is considered in the light of a foreign bill of exchange, requiring protest. (Cape Fear Bank v. Stinemets, 1 Hill, 44.)

It is the judgment of this Court, that the judgment of the Circuit Court be affirmed.