Bellemire v. Bank of United States

• Decision Date: 26 January 1839
• Citation: 4 Whart. 105
• Parties: BELLEMIRE v. The BANK OF THE UNITED STATES.
• Court: Pennsylvania Supreme Court

4 Whart. 105

BELLEMIRE v. The BANK OF THE UNITED STATES.

Supreme Court of Pennsylvania.

January 26, 1839

IN ERROR.

1. A bank which receives a note for collection, and when it is overdue places it in the hands of a notary in the usual course, is not liable for the neglect of the notary to give notice to an endorser.

2. A note had been deposited by the holder in a bank for collection. When it fell due and remained unpaid, it was placed, as usual, in the hands of the Bank's notary whose clerk called at the store of G. the last endorser, to inquire for the place of residence of C., the first endorser. The wife of G., who was in the store, told the clerk that C resided at a particular place, which was in fact the place of business of C.'s son. Notice was left at that place, and G. was informed of his wife's direction as to the place of residence of C. The note was renewed by agreement between the parties, and when it again fell due the notary's clerk again left notice at the place of business of C.'s son, supposing that it was the store of C.; by which mistake C. was discharged. Held, that neither the Bank, nor its agent, the notary, was liable to the holder of the note for the consequences of the omission to give notice to the endorser.

THIS was a writ of error to the District Court for the City and County of Philadelphia, to remove the record of an action on the case brought in that Court, by John B. Bellemire, against the President, Directors and Company of the Bank of the United States.

The declaration set forth that the plaintiff, being the holder of a promissory note, dated Philadelphia, September 7, 1832 drawn by Joseph N. Goodrich in favour of and endorsed by Jacob Coats, for $105 dollars, payable thirty days after date, deposited it with the defendants for the purpose of having its amount collected, and that it might be proceeded in according to law, and in case of non-payment by the drawer, that due notice might be promptly given to the endorser; averring that the defendants received the note and undertook to use all due diligence, care and attention, for the purpose of collecting it from the drawer and endorser and in case it should not be paid at maturity by the drawer undertook to give immediate notice to the endorser; averring also that on the 10th of October 1832 the note became due, and payment having been demanded of the drawer, by whom it was not paid, the defendants did not give or cause to be given immediate notice of non-payment to the endorser, but wholly neglected, & c., whereby the endorser was discharged, & c., and the amount wholly lost to the plaintiff, who was obliged to pay the costs of an unsuccessful action in this Court against the endorser.

The action was for the recovery of the amount of the note with interest, and the expenses of prosecuting the unsuccessful action against the endorser.

On the trial before JONES, J. on the 15th of October, 1835, the plaintiff examined as witnesses Jacob Coats, Abraham Coats, Leonard Englebert, and George Sharswood, Esq. The defendants read the depositions of Harriet Gouiran and Michael Gouiran, and examined James S. Farmer. Upon the testimony it appeared that the note in question was one given in renewal of a former note for the same amount, drawn and endorsed by the same parties, dated July 6, 1832, which, being payable sixty days after date, fell due on the day of the date of the note in question. Jacob Coats the endorser, was a justice of the peace, who lived in Third street near Tammany street. Joseph N. Goodrich, the drawer, was a tenant of his, who gave him the former note for the amount of certain rent for which he had been pressing him. Mr. Jacob Coats gave the note to his son, Abraham Coats of the firm of Coats & Moore, jewellers, on the south side of Chesnut street, the first door above Sixth street, in order that the son might dispose of it. Abraham Coats sold it to Leonard Englebert, a broker, who bought it as agent for the plaintiff, Bellemire. Mr. Englebert handed the note to Michael Gouiran, a jeweller in Chesnut street near Fourth street, who, as a friend of Mr. Englebert, received it for the purpose of depositing it in bank for collection. Mr. Gouiran kept an account in the Bank of Pennsylvania, and one in the Bank of the United States. He endorsed this first note and deposited it for collection in the Bank of Pennsylvania. On its maturity, not being paid within bank hours, the note was handed in the usual manner to the notary of the bank. The clerk of the notary presented it for payment at the store of the drawer, and was informed that he was out and had left no directions for its payment. The clerk, not knowing the endorser Coats, or his place of residence, called at the store of Michael Gouiran, the last endorser, by whom the note had been deposited in the bank. He there found Mrs. Gouiran, the wife of Mr. Gouiran, who was in the habit of attending his store. He handed her the notice of non-payment, directed to her husband, and inquired of her for the address of Mr. Coats, or where to leave the notice for Mr. Coats. (It did not appear whether or not he mentioned the first name of Mr. Coats.) She replied, " In Chesnut street the first door above Sixth." The clerk went to the place thus designated, and seeing the name of Coats & Moore, went in and left the notice with a boy in the store, desiring him to hand it to Mr. Coats.

On the same evening, Mr. Gouiran received the notice which had been left with his wife. Before that, she had told him that the notary's clerk had been there and had asked for Mr. Coats, and that she had directed him to the corner of Sixth and Chesnut streets. He was aware that the notary's visit had reference to this note, and was at the same time aware that the name on the note was the name of the elder Mr. Coats, the father of the young man at the corner of Sixth and Chesnut streets. After this, Mr. Gouiran took the original note out of the Bank of Pennsylvania. It was renewed by the parties, who gave the note now in question in lieu of it. The same broker Mr. Englebert, procured this second note from the drawer, got the elder Mr. Coats's endorsement of it, and took it to Mr. Gouiran, requesting him to deposit it in bank for collection, as before. Mr. Gouiran did so, except that in this instance he deposited it in the Bank of the United States, instead of in the Bank of Pennsylvania. On the day of its maturity it laid over; and after bank hours, was handed in the usual manner to the notary, who happened to be the same person who was notary of the Bank of Pennsylvania. The note in question was handed to the same clerk to whom the former note had been delivered. Nobody had ever remonstrated with him as to the former notice, or the place of leaving it. When he received the note in question from the Bank of the United States, the same course was pursued with it as had been pursued with respect to the former note except that there was no repetition of the inquiry which had been made of Mrs. Gouiran in respect to the former one. After demand of and non-payment by the drawer, the notice of non-payment was left as before at the store of Mr. Gouiran with Mrs. Gouiran, and at Coats & Moore's in Chesnut street above Sixth. No remonstrance or objection was afterwards made either to the notary or his clerk, to the Bank of the United States or its officers. The day after the note fell due, it was taken out of bank by Mr. Gouiran, who, a day or two after it fell due, handed it to Mr. Englebert, who, on the next day or the day after, called on Mr. Coats the father, who refused to pay it on the ground of not having received due notice of non-payment, but stated that there was a distress on the goods of the drawer, and if it produced money enough to pay the whole rent, including the amount of the note in question, the note should be paid out of the proceeds. The distress did not produce enough to pay the rent accrued after the rent for which the note was given. The drawer being insolvent, the present plaintiff sued the endorser Jacob Coats, and obtained an award of arbitrators for the amount of the note with interest. The defendant appealed, and upon the trial in Court obtained a verdict in his favour, which the Court refused to set aside, and upon which final judgment was afterwards entered for the defendant, who recovered his costs from the plaintiff. The witnesses, Mr. and Mrs. Gouiran, were not examined in the case against Coats. The plaintiff never gave to the Bank of the United States any notice of the institution or pendency of his suit against Coats, of which it did not appear that they had any knowledge, until the 16th of April, 1834, which was some time after its final termination.

In the course of the trial of the present case, it appeared that the Philadelphia Directory for the year 1831, contained the name and residence of Jacob Coats, justice of the peace, the endorser of the note in question, but did not contain the name or address of his son Abraham Coats of the house of Coats & Moore, at whose store the notices were left as above mentioned.

James S. Farmer, notary's clerk, in his cross-examination, testified as follows:

" When we receive a note for protest, and do not know where one of the parties lives, we inquire of the last endorser, because we always suppose he can give the best direction. * * * * * *

* * * * * Our first inquiry always is from the last endorser; and when he does not know where a party lives, we look into the Directory. I do not look into the Directory when I know positively where a party lives, or am directed positively where to leave the notice. Had Mrs. Gouiran told me she did not know where Mr. Coats resided, I would have inquired elsewhere, or would have looked into the Directory....