Continental National Bank v. . Townsend

87 N.Y. 8, 1881 N.Y. LEXIS 308

• Court: New York Court of Appeals
• Decided: November 22, 1881
• Status: Published

Opinion

Finch, J.

The principal question on this appeal has been decided'in this court adversely to the views of the appellant. In The Grocers' Bank v. Penfield (69 N. Y. 502), we determined, after a very full examination of the authorities, that where a promissory note is made for the accommodation of the payee, but without restriction as to its use, an indorsee taking it as collateral security for an antecedent debt of the indorser, without other consideration, but in good faith and before dishonor, occupies the position of' a holder for value and is protected as such. That doctrine decides this case, unless there be something in the further point sought to be raised cut of the fact that the note was transferred on the last day of grace. The court was asked to find as matter of fact that the. transfer was not before maturity, and refused so to find. The refusal was correct. ' The rule must be deemed settled in this State that the maker has the whole of the last day of grace within which to pay, and that any earlier action against him is premature. (Osborn v. Moncure, 3 Wend. 170; Hopping v. Quin,, 12 id. 517; Cayuga County Bank v. Hunt, 2 Hill, 635; Smith v. Aylesworth, 40 Barb. 104; Oothout v. Ballard, 41 id. 33.) While a different rule prevails elsewhere to some extent (Story on Prom. Notes, 278, note 2; Sargent v. Southgate, 5 Pick. 312; Ayer v. Hutchins, 4 Mass. 370; Pine v. Smith, 11 Gray, 38), the current of authority in this State is very manifest, and we can see no just reason for doubting it, or departing from it. Although this note was transferred on the last day of grace, it was yet transferred before actual dishonor, and so as to bar the equities sought to be interposed.

The judgment should be affirmed, with costs.

All concur.

Judgment affirmed.