Musson v. Lake

45 U.S. 262, 11 L. Ed. 967, 4 How. 262, 1846 U.S. LEXIS 397

• Court: Supreme Court of the United States
• Decided: January 29, 1846
• Status: Published

Opinions

Mr. Justice McKINLEY

delivered the opinion of the court.

The plaintiffs brought an action of ■ assumpsit, in the Circuit Court of. the United States for the Southern District of Mississippi, against the defendant, as indorser of a bill of exchange, drawn at Vicksburg, in said State, by Steele, Jenkins, & Co., for ‡ 6,133, payable twelve months after the first day of February, 1837, to R. H. & J. H. Crump; and addressed to Kirkman, Rosser, & Co., at New Orleans, and by them afterwards accepted, and indorsed by the payees and the defendant.

■ On the- trial of the cause, the plaintiffs offered to read as evidence to the jury a protest of the bill of exchange, to the reading of which the defendant objected ; because it did not appear in the protest, that, the notary had presented the bill to the acceptors, or. either of them, when he demanded payment thereof. • And upon the question, whether the protest ought to be read to the jury as evidence of a presentment of the bill to the acceptors for payment, or as evidence of the dishonor ¿of the bill, the judges were opposed in opinion. Which division of opinion they ordered to be certified to this court; and upon that certificate the question is now before us for determination.

The indorser of a bill of exchange, whether payable after date or after sight, undertakes that the drawee will pay it, if the holder present it to him at maturity a.ld demand payment; and if he refuse to pay it, and the holder cause it to be protested, and due notice to be given to the indorser, then he promises to pay it. All these conditions enter into and make part of .the contract between these parties to a foreign bill of exchange ; and the law imposes the performance of them upon the holder, as conditions precedent to the liability of the indorser of the bill. A presentment to and demand of payment must be made of the acceptor personally, at his place of business or his dwelling. Story/on Bills, § 325. Bankruptcy, insolvency, or even the death .of the acceptor will not excuse the. neglect to mgke due presentment; and in the latter case it should be made to the personal representatives of the deceased. Chitty on Bills, 7th London ed. 246, 247 ; Story on Bills, 360 ; 5 Taunt. R. 30 ; 12 Wend. R. 439 ; 2 Douglass, 515 ; Warrington v. Furbor, 8 East, 245 ; Esdaile v. Sowerby, 11 East, 117 ; 14 East, 500.

The reasons why presentment should-be- made'to'the- drawee- are, first, that he may judge of the genuineness of ¿lie. bill; secondly, of the right of the holdér to receive the contents ; and thirdly, that he may obtain immediate possession of the bill upon paying the amount. And ther acceptor has a right to see that the person demanding payment has a right to receive it, before he is bour . to answer whether he will pay it or not; for, notwithstanding, his acceptance, it may have' passed into other hands, before its maturity. And he, as well as the drawee, has a right to the possession of the bill, upon paying it, to he used as a voucher in the settlement of accounts with the drawer. Story on Bills, § 361 ; Hansard v. Robinson, 7 Bam. & Cressw. 90.

Mr. Justice Story has given the,form of a protest now in use in England, in bis treatise on bills of exchange, by which it will he seen that the words s‘ did exhibit said bill ” are used, and a blank is left to be filled up with “ the presentment, and to whom made, and the reason, if assigned, for non-payment.” ‘ Story on Bills,, 302, note. This, with the authorities already referred to, shows that the protest should set forth the presentment of the bill, the demand of payment, and the answer of the drawee o. acceptor.. The holder of the bill is the proper person to make the .presentment of it for payment or acceptance. Story on Bills, §360. But the law makes the notary his agent for the purpose of presenting the bill, and doing whatever the holder is bound to do to fix the •liability of the indorser. Every thing, therefore, that he does in the performance of this duty must appear distinctly in his protest. He is the officer of a foreign government; the proceeding is ex parte ;. and the evidence contained in the protest is credited in all foreign courts. Chitty on Bills, 215 ; Rogers v. Stephens, 2 T. R. 713 ; Brough v. Parkings, 2 Ld. Raym. 993 ; Orr v. Maginnis, 7 East, 359 ; Chesmer v. Noyes, 4 Camp. 129. The evidence contained in the protest must, therefore, stand or fall upon its own merits. It rests upon the same footing with parol evidence ; and if it fails to make full proof of due diligence on the part of the plaintiff, it must be rejected.

But the counsel for the plaintiffs insists, thát the statute of Louisiana, and the interpretation given to it by the Supreme Court of that State in the case of Nott’s Executor v. Beard, 16 Louisiana Rep. 308, have so changed the law merchant, as to render unnecessary the presentment of a foreign bill for payment. After a careful examination of the opinion of the court in that case, we are unable to perceive any intention manifested to depart from the settled usages of the law merchant; but, on the contrary, they attempt by argument and authority to bring the case within that law. The question before that court was the identical question now before us. The protest was objected to because it did not show that the bill had been presented by the notary to the acceptors for payment. To this objection, that court said it might. perhaps have been more specific if in the protest it had been stated that the bill was Í(resented, and payment thereof demanded. And they admit the ¿w is well settled, that, before the holder of an accepted bill can call on the drawer for payment, he must make a presentment for, or demand of, payment, and give notice of the refusal. Here, then, is a definite proposition, asserting that a presentment for payment and a demand óf payment are convertible terms, and that the proof of either would be sufficient.

-To support this proposition, they refer to Chitty on Bills, and Bayley on Bills, and the annotators on them. And as further proof and illustration,. and to show that demand of payment should be preferred to presentment for payment, they refer to the statute of Louisiana, passed inT827, in which they say the word demand is used in it, and that the word pre. entment is not; and they refer to the statute, also, to show that not 'ries were vested with certain powers by it, which gave authority to their acts ; and that they being public officer?, the presumption of law is, that they do their duty; and therefore, if the protest ';.ere defective, and liable to the objection urged against it, this presumption of law would cover all such defects. This is substituting presumption for proof, iri violation of all the rules of evidence.

With all due respect for that distinguished tribunal, we are constrained to dissent from the general proposition they have laid down' on the subject of demand and presentment, and from all their reasoning in support of it. Due diligence. is a question of law ; and we think we have shown, by abundant authority, that the holder of an accepted bill, to fix the liability of the drawer or indorser, must present it to the acceptor and demand payment thereof. It may be well here to repeat what Lord Tenterden, C. J.,. said on this subject, in delivering the judgment of the Court of King’s Bench, in the case of Hansard v. Robinson, before referred to. He said, — “ The general rule of the English law does not allow a suit by the assignee, of a chose in action. The custom of merchants, considered as part of the law, furnishes in this case an exception to the general rule. What, then, is the custom in this respect ? ■ It is, that the holder of the bill shall' present the instrument, at its maturity, to the acceptor, demand payment of its amount, arid, upon, receipt of the money, deliver up the bill. The acceptor paying the- bill has a right to the possession of the instrument for his own security, and as his voucher, and discharge pro tanto, in his account with the drawer. If, upon an offer of payment,- the holder should refuse to deliver up the bill, can it be doubted that the acceptor might retract his offer, or retain his money ? ” This extract," we think, furnishes a full answer to all. that has been said ' by the Supreme Court of Louisiana to prove that it is not necessary, to present the bill to the acceptor for payment ; and to the presumption of law relied on to cure the defects in the protest.

But to show, that, by the statute of Louisiana, the presentment of a bill to the acceptor for payment is not dispensed with, and that the presentment is, by a fair construction of the act, as much within its true intent and meaning as the demand, we proceed to examine its provisions. The principal object of the legislature in passing this statute seems to have been, to give authority to notaries to give notices, in all cases of protested bills and promissory notes-;. and to make their certificates -evidence of such notices. And, therefore, all that is said on the subject of the demand and the manner of making it, and the other circumstances attending it, was not intended as a new enactment on these subjects, but as inducement to the powers conferred on the notary, which was the principal object of the statute, as will appear, we think, by reading it. That part of it which relates, to this subject is in these words : — “ That all notaries, and persons acting as such, are authorized, in their protests of bills of exchange, promissory notes, and orders for the payment of money, to -make mention of the demand made upon the drawee, acceptor, or person on whom such order or bill of exchange is drawn or given, and of the manner and circumstances of such demand ; and by certificate, added |p such protest, t© state the manner in which any notices of protest to drawers, indorsers, or other persons interested were served or* forwarded ; and whenever they shall have so done, a certified copy of such protest and certificate shall be evidence of all the notices therein stated.”

It seems to have been taken for granted by the legislature, that the notaries knew how to make out a protest, and therefore they did not prescribe the form, but gave the substance of it, to which the notary was required to add a certificate of the manner in which he had given notices, and when done, according to the statute, a certified copy of the protest and certificate should be evidence, not of the demand and manner and circumstances of the demand, but of the notice only. - This shows that the intention of the legislature, in passing this part of the statute, was merely to authorize the notaries to give notices, and to make the copy of the protest, and the certificate added to it, evidence of notice in the courts of Louisiana. But independent of this view of the subject, we think the languagé employed in this statute includes the presentment of the bill for payment, and for all other purposes, as fully as it does the demand of payment. In giving construction to the act, the phrase, “and of the manner and circumstances of such demand,” cannot be rejected, but must receive a fair interpretation. When taken in connection with other parts of the statute, what do these words mean ? The manner of making a -demand of payment, we have seen, is by presenting the bill to the drawee or acceptor ; arid so important is this part of the proceeding, that the omission to present the bill to the acceptor wdll justify his refusal to pay it, although payment be demanded. The legislature cannot be presumed to have intended to make so important a change in the law merchant as that ascribed to them by the counsel for the plaintiffs, without at the same time providing some other mode of obtaining the acceptance and payment of bills of exchange, and of. holding drawers and indorsers to their liabilities. It is but reasonable, therefore, to give to the phrase before referred to such construction, if practicable, as will leave the law merchant as it stood before the passage of the statute, and carry into effect the main 'intention of the legislature. . This, we think, may fairly be done without doing any violence to the intention or the language of the statute.

The manner of the demand must, therefore, mean the presentment of the bill for either acceptance or payment; and the circumstances of the demand, we think, means the place where the presentment and demand is made, and the person to whom or of whom it is made, and the answer made by such person. It is very clear,.that bills payable at sight, and after sight, are within the meaning of the statute ; because it provides for a demand of payment of the acceptor of a bill. Now how can there be an acceptor of a bill, without a presentment for acceptance ? Until the bill become due, payment cannot be demanded of the drawee. This shows, that without the word presentment and the word demand also, the plain meaning of the statute could not be carried into effect. A bill, payable at a fixed period after its date, need not be presented for acceptance ; it is sufficient' to present it and demand payment when it arrives at maturity ; but a bill payable at sight, or after sight, can .never become due until after it has been accepted. How is the holder or the notary to obtain the acceptance of such a bill, under the decision of the Supreme Court of Louisiana ? Will it be sufficient to demand payment of the bill? That would be a nugatory act, because it is not due ; then it must be admitted, that, by fair and necessary construction, the word presentment is within the plain meaning and intention of the statute, and that the bill may be presented for acceptance or for payment, and therefore neither the statute nor the decision of the Supreme Court of Louisiana has changed the law merchant in any of these respects.

There is, however,'another question, entirely independent of the statute and the decision of the Supreme Court of Louisiana, which may be decisive of the case before this court; and that question is, Whether the contract between the holder and indorser of the bill in controversy is to be governed by the law of Louisiana, where the bill was payable, or by the law of Mississippi, where it was drawn and indorsed. The place where the contract is to be performed is to govern the liabilities of the person who has undertaken to perform it. The acceptors resided at New Orleans; they became parties tq the bill by accepting it there. So far, therefore, as their liabilities were concerned, they were governed by the law of Louisiana. But the drawers and indorsers resided in Mississippi; the bill was drawn and indorsed there; and their liabilities, if any, accrued there. The undertaking of the defendant was, as before stated, «that the drawers should pay the hill; and that if the holder, after using due diligence, failed to obtain payment from them, he would pay it,with interestand damages. This part of the contract was, by the agreement of the parties, to be performed in Mississippi, where the suit, was brought, and is now depending. The construction of the contract, and the diligence necessary to be used by the plaintiffs to entitle them to a recovery, must, therefore, be governed by the laws of the latter State. Story on Bills, § 366; 4 Peters, 123; 2 Kent’s Comm. 459; 13 Mass. R. 4 ; 12 Wend. R. 439 ; Story on Bills, § 76; 4 Johns. R. 119 ; 12 Johns. R. 142; 5 East, 124 ; 3 Mass. R. 81 ; 3 Cowen, 154; 1 Cowen, 107; 5 Cranch, 298.

Whatever, therefore, may have been the intention of the legislature in passing the statute, and of the Supreme Court of Louisiana in the decision of the case referred to, neither can affect, in the slightest degree, the case before us. In Mississippi the custom of merchants has been adopted as part of the common law ; and by that law and their statute law, this case must be governed. We think, therefore, the protest offered by the plaintiff, as evidence to the jury, ought not to have been received' as evidence of presentment of the bill to the acceptors for payment, nor as evidence of the dishonor of the bill; which is ordered to be certified to the Circuit Court accordingly.

Mr. Justice McLEAN. I think the protest was evidence. The notary made demand of payment, at the maturity of the bill, and we know that he had possession of the bill, from the fact of the protest being made on the same day. Now as the notary could' not make a legal demand in the absence of th§ bill, the fair, if not the necessary, inference is, that he had possession of the bill when he demanded payment.