Bank of Jamaica v. Jefferson

• Decision Date: 06 May 1893
• Citation: 22 S.W. 211
• Parties: BANK OF JAMAICA v. JEFFERSON et al.
• Court: Tennessee Supreme Court

22 S.W. 211

BANK OF JAMAICA v. JEFFERSON et al.

Supreme Court of Tennessee.

May 6, 1893.

Appeal from chancery court, Shelby county; W. D. Beard, Chancellor.

Bill by the Bank of Jamaica against J. T. Jefferson, C. C. Glover, and Toof, McGowan & Co., to recover on a promissory note. From a judgment for plaintiff, defendants Toof, McGowan & Co. appeal. Reversed.

Gantt & Patterson and McDowell & McGowan, for appellants. Watson & Hirsch, for appellee.

WILKES, J.

The Bank of Jamaica, claiming in its bill to be a corporation under the laws of New York, brought suit in the chancery court of Shelby county against J. T. Jefferson, C. C. Glover, and Toof, McGowan & Co. to recover a note for $1,500, and interest. The note is as follows: "$1,500.00. Memphis, Tenn., Dec. 4, 1890. Four months after date I promise to pay, to the order of F. W. Dunton, fifteen hundred dollars at Corbin Banking Co., New York, N. Y. Value received. J. T. Jefferson." Indorsed as follows: "Without recourse. F. W. Dunton. C. C. Glover. Toof, McGowan & Co. Pay W. H. Porter, Esq., cashier, or order, for collection account of Bank of Jamaica, Jamaica, Long Island. Wm. S. Wood, Cashier." Upon the hearing the chancellor rendered judgment against all the defendants, (F. W. Dunton not being sued,) and defendants Toof, McGowan & Co. have brought the case to this court on writ of error, and assign as error that the note shows that Toof, McGowan & Co. are only accommodation indorsers on it, and that they are not principals; and that there is no proof in the record that any demand was ever made upon the maker; and that he made default in payment; and that the note was thereupon protested for nonpayment; and especially that no notice was ever given to them of such demand and protest for nonpayment.

The law is plain that to hold an indorser liable upon his indorsement, made regularly, in the ordinary course of business, or for accommodation there must be presentment and demand made of the maker, and protest if payment is not made, and that notice of such demand, failure to pay, and protest must be given to the indorser; and all these facts must affirmatively appear, and the burden of proof is on the party suing upon the note to show such facts. Rosson v. Carroll, 90 Tenn. 90, 130, 16 S. W. Rep. 66. This is a universal rule in cases where indorsements are made in the regular course of business. In the case at bar, however, it appears from the testimony of Jefferson, the maker, and Dunton, the payee, which is the only testimony in the case, that the note sued on was made by Jefferson to cover a balance due from him to Dunton; that Dunton lived in New York, and Jefferson in Memphis. Jefferson states that, before he sent the note to Dunton, he procured Glover and Toof, McGowan & Co. to indorse it for him, and that they did indorse it merely as additional security to Dunton, the payee, for the money that Jefferson owed him, and to enable Dunton to discount it, and obtain the money thereon. Dunton states that he received the note by mail with the same understanding, and, inasmuch as the note was payable to him, he indorsed it without recourse, so as to transfer the legal title, without legal liability against himself; that it was transferred before due to the Bank of Jamaica; and that by inadvertence the indorsement made by him was placed above the names and indorsements of the other parties. Under these facts, which are competent to be shown by parol, Toof, McGowan & Co., as well as C. C. Glover, must be regarded as joint makers with Jefferson of the note, and not simply as ordinary indorsers in due course of trade; and th...