In reply to the argument on the other side, upon the effect of the draft as an assignment of so much of the funds in the hands of the drawees, Mr. O ’Conor proceeded to say in
substance—“
Delivery to the donee of such an instrument as will enable him, by force of the instrument itself, to reduce the fund into possession, will suffice,” is the plaintiff’s doctrine. This might safely be conceded. It might even be conceded, that a delivery out of the donor’s control of an instrument without which
he
could not recover the fund from his debtor or agent, would also suffice. Neither of these effects was produced by delivering the draft in question. An outstanding unaccepted draft upon a debtor or agent, affords him no defense against a suit for the fund. Neither'is it pretended that the holder can maintain an action at law against him.
The plaintiff is driven, as a last resort, to assume the position that this draft might operate as an equitable assignment,
pro tanto,
of Smith’s funds in the hands of his partners.
A draft is not an assignment
per se ;
but only a mandate, it has no direct operation on the fund itself. As a mere draft, equity cannot give it any other effect than the law gives it. Consequently, in order to convert it into an assignment, some special ground of equity must be shown by extrinsic circumstances. This can not be done in the present case. If the draft had been given for a valuable consideration, so that to countermand it would violate conscience and constitute a fraud, there would be some plausibility in seeking aid from chancery; but that court does not enforce specific performance of inchoate
gifts. (Story’s Eq. Jur.
§§ 706
a,
787, 793
a,
987,1040 c, 433, 973.) The notion that a draft may operate as an equitable assignment of the fund, has never been advanced, except in cases where the draft was issued for a valuable consideration.
Independently of the want of consideration, there is another conclusive answer. A draft or order issued by the owner of a particular fund directing the holder thereof to pay the
whole
of
it to a third person, may under certain circumstances operate as an equitable assignment. But the draft in question is neither upon any particular fund, nor for the whole of such fund. If the drawees of such a draft were liable to account in equity to the holder, any creditor might harass his debtor with a multitude of chancery suits. That they are not so liable, is conclusively established by high authority. (5
Wheat. 277;
286; 5
Pet.
580.)
All that has been said about
‘‘
appointment,” serves merely to obscure the discussion.' It is an inappropriate term borrowed for no beneficial end from a branch of jurisprudence altogether foreign to the present question. A term invented by conveyancers to describe the peculiar
modus operandi
whereby the beneficiary of an express trust exercises his power of disposition over the trust fund, is very much out of place when applied to the act of a party drawing upon his common law agent for part of his own legal estate. Misnomers may prolong an argument; but in a learned court they can scarcely perplex it, and certainly will not be permitted to alter the nature of things.
Ruggles, J.
The plaintiff’s claim is founded on a bill or draft in these words:
“ Messrs R. Clark
& Co.
Please to pay Nancy Harris or order, thirty thousand dollars; and place the same to my account.
New-York, 9th July, 1844. Sidney Smith.
(Endorsed.) Pay to the order of Levi Harris.
Nancy Harris.”
This draft was made at New-York, during Sidney Smith’s last illness, and was intended to take effect only in case of his death before he should be able to reach the residence of his sister, Mrs. Harris, in Chenango county. It was not intended nor can it be supported as a gift
inter vivos;
and the question is, whether it is valid as a
donatio mortis causa
to entitle her to recover the money mentioned in it against the representatives of the drawer.
If the. draft had been accepted by Clark & Co. the drawees,
before or after the death of Sidney Smith the drawer, it would have operated from the time of Smith’s death, as an assignment to Mrs. Harris, of so much money in the hands of Clark & Co. and it would have afforded to the plaintiff a remedy against that firm. In that case, it would have been like a gift of a promissory note, or other chose in action against a third person; and the delivery of possession would have been sufficient to make the gift valid, because, although there was no actual delivery of the money; there was a delivery of the means of obtaining the money. Thus far the' law seems to be settled and understood by both parties. The cases cited at the bar, and the able and learned opinion given in the supreme court, leave no doubt on this point.
But the defendant insists that the draft, unaccepted, did not operate as an appropriation or transfer of a title to or lien upon the money in the hands of Clark & Co. the drawers; that it afforded to the plaintiff no remedy legal or equitable against them; that it amounted only to a promise by Smith the drawer to pay in case Clark & Co. should fail to do so ; that the gift was therefore inperfect and invalid because it was a gift of a promise to pay only, without consideration and without delivery of the thing given. If this was the effect of the draft, the case stands on the same footing, as if the donor had made and delivered to Mrs. Harris his promissory note, as a voluntary gift, in expectation of death; and if such a gift is valid, the plaintiff is entitled to recover in the present case, otherwise not. This question was presented to the supreme court, in the case of
Wright
v.
Wright,
(1
Cowen,
598.) The plaintiff in that case, brought his action on such a note against the executors of the donor, and had a verdict, the defendants being unable to prove the facts on the trial, Soon after the trial, the defendants discovered evidence of the fact that the note was a gift, by the testator during his last illness; applied to the circuit judge for a stay of proceedings, in order to move for a new trial, which the circuit judge refused; the defendants appealed from the decision, and the case came before the court on a special motion. The court, in the reported opinion, said it was clearly inferable
from the facts presented in the affidavits, that the note was a
donatio causa
mortis, and in that respect was distinguished from the case of
Fink
v.
Cox,
(18
John.
145,) cited by the defendants’ counsel. They denied the motion on that ground. From the manner in which that case came before the court, it is fairly to be presumed, that the point on which the case turned was not argued by the counsel with any careful preparation, or examined by the court with the same deliberation as if the question had been presented on a bill of exceptions, or a case made. The granting of new trials on newly discovered evidence, rests in some degree in the discretion of the court. The circuit judge appears to have denied the order for a stay of proceedings, on the ground that the defence was of a nature not to be favored, and although the court put their decision on the ground that the note was valid, they may have adopted that conclusion with less caution than if the defence had been of a different character.
Independent of authority, my own judgment would have led me to the conclusion which the supreme court in that case adopted. In natural justice, I see no reason why he who freely and deliberately makes his note or bond to another for the payment of a sum of money, by way of voluntary gift, should not be compelled to perform his engagement. For, although the giver in such case receives nothing in return, for what he agrees to give, the breach of his promise may by creating unfounded expectations cause an injury to the donee, which never would have happened if the promise had not been made. But upon a careful examination of the previous and subsequent oases, I am satisfied that a voluntary promissory note without consideration is not, as the law now stands, the subject of a valid gift by the maker, either as a present donation or as a gift to, take effect at the death of the donor.
Pearson
v.
Pearson, (7 John.
26,) was an action of assqmpsit on a promissory note; and the court said that the validity of the note could not be supported on the ground taken at the trial, of its being a gift; for a gift is not consummate and perfect until a delivery of the thing promised, and until then, the party
may revoke his promise. A promise to pay money as a gift, is no more a ground of action, than a promise to deliver a chattel as a gift. It is the delivery which makes the gift valid. In
Fink
v. Cox, (18
John.
145,) a father gave a note to his son for $1000, payable in sixty days. It was a gift founded on the consideration of natural love and affection only. After the father’s death, the son brought his action against his father’s executors. It was held that although such a consideration is sufficient in a deed, against all persons except creditors and
bona fide
purchasers, it was not so in a personal action on an executory contract, and the plaintiff on that ground failed. This was regarded as an intended gift
inter vivos.
The same point was decided in
Holliday
v. Atkinson, (5
Barn, & Cress.
501.)
Gifts, however, are valid without consideration or actual value paid in return. ' But there must be delivery of possession. The contract must have been executed. The thing given must be put into the hands of the donee or placed within his power by delivery of the means of obtaining it. The gift of the maker’s own note is the delivery of a promise only, and not of the thing promised, and the gift therefore fails. Without delivery, the transaction is not valid as an executed gift; and without consideration it is not valid as a contract to be executed. The decision in
Wright
v.
Wright
was founded on a supposed distinction in this respect, between a gift
inter vivos
and a
donatio mortis causa.
But there appears to be no such distinction. A delivery of possession is indispensable in either case. In
Noble
v.
Smith,
(2
John.
56,) Kent, C. J. declares that delivery in both kinds of gift is equally requisite on grounds of public policy and convenience, and to prevent mistake and imposition. Abbott, C. J. in
Holliday v. Atkinson,
which was the case of a gift of the maker’s own note, says that a promissory note is not good as a
donatio mortis causa.
In
McDowell
v.
Murdock,
(1
Nott & McCord,
239,) Mr. Justice Nott declared that after examining all the cases brought to the view of the court, he had not been able to discover any foundation for the distinction made between a
donatio causa mortis
and any other parol gift in respect to the necessity of actual delivery. In
New Hampshire, Vermont, Massachusetts and Connecticut, it has been expressly decided that a gift by the maker of his own promissory note, can not be sustained as a
donatio causa mor
tis,
(Copp
v.
Sawyer,
6
New Hamp., Rep.
386;
Holley
v.
Adams,
16
Verm. Rep.
206 ;
Parish
v.
Stone,
14
Pick.
198;
Raymond v. Sellick,
10
Conn. Rep.
485,) And in
Craig
v.
Craig,
(3
Barb. Ch. Rep.
116,) published since the argument of the present case, the late Chancellor Walworth concurs in overruling the case of
Wright
v.
Wright.
So far, therefore, as this point may affect the question in controversy in this case, it must be regarded as settled against the decision in
Wright
v.
Wright,
and that the gift of the draft in question must fail, if it is to be enforced only as an executory contract against the representatives of the donor.
A
donatio mortis causa
takes effect from the time the gift is made, but it is revocable during the life of the donor. If not revoked during his life, the title of the donee becomes absolute at his
death;
and by relation from the time of the delivery. (1
Williams on Executors,
552.) There was no revocation of the gift in controversy by the donor, and it became absolute at his death, if there was a sufficient delivery of the thing given during his life; and this depends on the question whether the draft without acceptance gave to Mrs. Harris a remedy
against Clark Sp Co.
either in law or equity to Recover the money. In other words, did the draft operate as an assignment or appointment to her of so much money in the hands of Clark & Co., or create a lien upon it to be enforced against them
1
If so, the delivery was sufficient, because the instrument delivered was the means by which the money could be obtained from a third person. It is on this reason that the gift of a bond or other evidence of debt due from a third person, is valid.
(Snellgrove
v.
Bailey,
3
Atk.
214;
Coutant
v.
Schuyler,
1
Paige,
316;
Wells
v.
Tucker,
3
Binn.
366 ;
Gardner
v.
Parker,
3
Mad.
102.)
The draft in question is not a check on a bank or on a banker, but an inland bill of exchange. One of the characteristics which distinguish a check from a bill of exchange is that a check
is always drawn on a bank or banker.
(In the matter of Brown, 2 Story’s Rep.
502.) K Clark & Co. were the late partners of Sidney Smith, but they do not appear to have been bankers. The instrument in question has the form and requisites of an inland bill of exchange. It is payable absolutely and at all events, and not out of a particular fund, to the order of Mrs. Harris, and is indorsed by her. It is not necessary for the purpose of giving it the character of a bill of exchange that a time should be specified for the payment of the money. Bills of exchange, foreign or inland, may be drawn payable on demand; and a bill in which the time of payment is not expressly specified is, by implication of law, payable on demand.
(Story on
Bills, § 50.) It is clearly settled that no action at law will lie in favor of the holder of a bill of exchange against the drawee unless he accepts the bill. (2
Story’s Eq. Juris.
1043.) The research of the counsel for the plaintiff has not enabled me to find a case where it has been held that upon a negotiable bill of exchange the drawee has been made liable in equity to the holder of the bill without his acceptance or assent. Such an instrument gives to the holder no lien upon the funds in the hands of the drawee. It is said by Mr. Chitty in the first page of his treatise on bills, that a bill of exchange operates as an assignment to the holder of the debt due from the drawee; and the same observation is to be found in several adjudged cases. But the true doctrine will be found stated in
Mandeville
v.
Welch,
(5
Wheat.
286.) In delivering the opinion of the supreme court of the United States, Mr. Justice Story, in that case, observed, that it had been said
“
that a bill of exchange is in theory an assignment to the payee of a debt due from the drawee to the drawer. This is undoubtedly true
when the bill has been accepted,
whether it be drawn on general funds, or a specific fund, and whether the bill be in its own nature negotiable or not; for in such case the acceptor, by his assent, binds and appropriates the funds for the use of the payee. But where an order is drawn on a general, or on a particular fund for a part only, it does not amount to an assignment of that part, or give a
lien on the drawee unless he consent to an appropriation by an acceptance of the draft.”
In
Tieman
v. Jackson, (5 Peters, 580,) an attempt was made to charge the drawee of a bill of exchange with the payment of its amount after it had been protested and dishonored. The circumstances were special. On the day of the date of the bill, the drawer assigned to the drawee for the payment of this bill and others the proceeds of a shipment of tobacco, then on its way, and consigned to the drawee, which the drawee afterwards received and converted into cash. But the drawee being a creditor of the drawer of the bill, had the property attached and sold, and instead of paying the bill applied the proceeds to his own use, It was held that the plaintiff was not entitled to recover. The bill was drawn by Fletcher upon Tieman in favor of Johnson, and the ground of the decision was that although Tieman was accountable to Fletcher for the proceeds of the cargo, Fletcher could not make him the debtor of Johnson, without his own consent. There was in that case, not only a bill of exchange, but an express assignment of the fund besides; and yet it was held that the action would not lie in favor of the assignee without a promise by the debtor to pay him instead of the original creditor. An attempt was made also in Luff against Pope, to recover against the drawee of a bill of exchange without acceptance, on the ground, substantially, that the instrument was not a bill of exchange, but intended as an order on a special fund; but the attempt failed. The instrument was in form a bill of exchange. And Mr. Justice Bronson in the opinion of the court says, “ it would be enough to say that a written instrument which is perfectly plain and explicit on its face can not be changed into something else by any inquiry into extrinsic facts. It must speak for itself.” He further said that the debt due from the drawee to the drawer of the bill was a chose in action which could not be transferred so as to give the assignee the right to sue in his own name, except in the form of an accepted bill of exchange.
These were actions at law ; but it is said that a different rule prevails in equity, and we are referred to
2 Story’s Eq.
§ 1044,
to show that the holder of a bill of exchange has an equitable lien on the funds in the hands of the drawee, which may be enforced against him without his acceptance or assent. This is undoubtedly true with respect to drafts on a special fund, which are not bills of exchange; and it will be found on a careful reading of the section referred to; and of the cases quoted in the notes, that the commentator is speaking of orders to pay over particular debts, and drafts on particular funds, and not of bills of exchange proper. The cases cited on the argument are of the same description excepting a few mere dicta. In
Peyton
v.
Hallet,
(1
Caines,
363,) the point arose on an order by the plaintiff to pay
White
a witness a certain sum out of the money to be recovered in that suit.
Cutts
v. Perkins, (12
Mass.
206,) was the casé of a draft made by Abbott, the owner and master of a ship, payable out of certain freight and primage due him from the defendant. The draft
was accepted and paid
by the defendant. Afterwards the administrator of the drawer brought an action for the freight. The draft was held to be an assignment of Abbott’s claim for the freight.
Row
v.
Dawson,
(1
Ves. sen.
331,) was the case of a draft made by
Gibson,
for certain sums payable out of certain moneys due him from the exchequer. In
Yeates
v.
Groves,
(1
Ves. jun.
281,) the first observation of the lord chancellor in giving his opinion is, “ the order was not a bill of exchange being payable out of
h
particular fund.”
Lett
v.
Morris,
(4
Simons,
607,) was the case of a draft payable out of moneys due on a building contract. In
Weston
v.
Barker,
(12
John.
276,) there was an assignment of certain policies of insurance in trust to hold the balance of money payable thereon, subject to the order of the assignor. The trust was accepted in writing, and the assignor ordered the trustee to account for the balance to the plaintiff. It was not the case of a bill of exchange.
Clark
v.
Adain, cited in
4
D. & E.
343, was the draft by an officer on the agent of his regiment payable out of the first money which should become due to him for arrears.
These cases establish the rule that a draft payable out of a particular fund operates as an assignment
pro tanto
to the drawee; that an accepted bill of exchange operates in the same
way ; 'but none of them go to the extent of giving that effect to a bill not accepted. The only case I have been able to find, favoring a different doctrine, is that of
Corser
v. Craig, (1
Wash. C. C. Rep.
434,) concerning which it is only necessary to say, that so far as it might affect the question now in hand, it is overruled by the case of
Mandeville
v.
Welch,
heretofore referred to; and the principle appears to be firmly established that a bill of exchange does not of itself give to the holder either at law or in equity a lien upon the funds of the creditor in the hands of the debtor, until after acceptance by the latter. A different rule would be inconvenient and dangerous, because it would enable the creditor by drawing bills, to entangle his debtor in litigation with a stranger, (and not only with one, but with any number of strangers,) in regard to the accounts and transactions between him and his creditor.
The authority on which the plaintiff’s counsel mainly relied, upon, the argument, was the case of
Lawson
v.
Lawson,
(1
P. Wms.
441.) In that case the testator on his death bed drew a bill upon his goldsmith to pay £1000 to his wife, and declared in a note in his own hand-writing on the bill that the money was to buy her mourning and to maintain her until her jointure should become due.
(See 2 Ves. jr.
120.) The master of the rolls held the gift valid as a
donatio causa mortis,
and 'to operate as an appointment; and he further said that being for mourning, it might operate like a direction given for his funeral, which ought to be observed, although not in his will. Lord Loughborough afterwards, in
Tate
v.
Hilbert,
(2
Ves. jr.
121,) says that the decision in
Lawson
v.
Lawson
was right, but that the report in P. Williams is inaccurate, and does not show the
ratio decidendi;
and that “ taking the whole will
together,
it is an
appointment
of the money in the banker’s hands to the extent of £1000 for the particular purpose expressed in a written appointment, which is a purpose that necessarily supposes death. Therefore that case is perfectly Well decided.” The obscurity in regard to the true reason of the decision, is not perhaps entirely removed by the observations of Lord Lough-borough. If by the word appointment is meant a direction
which the executors were to carry into effect, then the paper was testamentary. But the master of the rolls could not have regarded it in that light, for he did not require the paper to be proved in the ecclesiastical court. In this state it would be a palpable violation of the statute concerning wills, to hold the gift valid on the ground of its being testamentary in its nature. But if an “ appointment” meant an appropriation of the money to a specific purpose for the benefit of the wife, then it was in effect an assignment or transfer to her for that purpose, and that is the sense in which I understand the word to have been used. It was so understood by Chancellor Walworth in
Craig
v.
Craig,
(3
Barb. Ch. Rep.
118.) And yet Lord Loughborough, in
Tate
v.
Hilbert,
says,
“
But upon that decision
(Lawson
v. Lawson) I can not say that in all events drawing a cash note upon a banker is an appointment of the money in his hands.”
The report of the case in
Peere Williams
is obscure in another respect. It does not show who was the plaintiff nor who were defendants. But it is to be gathered from Lord Lough-borough’s statement of the case, from the register’s book, that the bill was filed by the executors against the wife and the banker. The object of the bill, therefore, must have been to restrain the banker from paying the money to the wife upon the draft. It was not therefore a bill by the wife to enforce the performance and completion of the gift, in which case the decision might well have been against the donee on the established principle that a court of equity will not lend its aid to give effect to an imperfect voluntary conveyance. But it was a suit for the purpose of stopping the payment by the banker of money in his hands which had been “ appointed,” appropriated or assigned to the wife, and which was about to pass into her hands without the aid of any legal proceeding. In such a case a court of equity might justly refuse to interfere either for the purpose of restraining or of enforcing the completion of an imperfectly executed gift.
But assuming that the judgment in
Lawson
v.
Lawson
was founded on the principle that the draft in that case operated as an immediate assignment of so much of the testator’s
funds in the hands of his banker, and as a delivery of the money, the decision does not support the plaintiff’s claim which, on the evidence in the case, appears to be founded on an unaccepted. bill of exchange, and not on a check on a banker, as in the case last cited. The former instrument is clearly not an assignment of the fund in the hands of the drawee so as to create a lien upon it in favor of the holder; while a check on a bank is said in many cases to operate as a transfer from the time of its presentment or notice to the bank. There are plausible, if not solid, reasons for this distinction, arising out of the course of business and the mutual understanding between banks and their customers. The customer deposits his money in a bank for safe keeping, with the understanding that he may draw by checks in such sums, and at such times, as may suit his convenience. The bank or banker receives it on that condition, and undertakes to keep the amount and pay the money accordingly. Checks are used and treated as cash, and by the course of business they are paid by the bank or banker on whom they are drawn, with the same punctuality and certainty as if the deposits were specifically the money of the customers. Checks are therefore practically equivalent to a transfer of so much of the fund deposited.
Bills of exchange on persons of other occupations are not always paid or expected to be paid with the same precision or punctuality. There may be more uncertainty with respect to the amount of funds in the hands of the drawee: the funds may not be in cash or convertible immediately into cash. Bills are usually drawn at longer time, and are frequently taken more on the general credit of the drawer, and with less certainty of acceptance and payment by the drawee, than checks on a bank or banker, where the credit is founded on actual cash in deposit. There is moreover no such obligation, on the part of debtors in general, as in the case of banks and bankers, to pay their debts in parcels, and in such sums, and at such times upon such drafts as may suit the convenience of their creditors.
But whether a bank check operates in favor of the holder as an assignment of the fund, so as to give him a remedy against
the drawee, who refuses to accept or pay, is perhaps yet unsettled ;
(See 2 Story’s R.
516,
In the matter of Brown a bankrupt; Dykers
v.
The Leather Manuf. Bank,
11
Paige,
617;) and it is not necessary to determine it with a view to the case under consideration. We have already seen that the plaintiff has no remedy, legal or equitable, upon his bill of exchange against the drawer : and that as against the representatives of the drawer it is without consideration.
Assuming, as we must in this case, that the draft is genuine, there is no doubt of the intention of Mr. Smith to give the money in question to his sister—and I come to a conclusion against her right with reluctance—a reluctance qualified, however, by the belief that the clear policy of the law is against the encouragement of gifts of this nature. They are essentially testamentary ; they are to take effect only in case of the testator’s death, and they are revocable during his life. The same considerations of prudence and caution which induced the legislature to require wills of personal estate to be executed, published and attested with great formality, would seem' to forbid these informal dispositions of property in expectation of death. The temptation to fraud and imposition in regard to these gifts is as powerful and as dangerous as in the case of wills, and yet has been left unchecked and unregulated by statute: and they ought not to be tolerated by the courts, unless they are attended by all the requisites which the common law prescribes to give them validity.
Jewett, O. J., Gardiner and Hoyt, Js., concurred.
Cady, Shankland and Strong, Js., were for reversal.
Judgment affirmed.