Britton v. Niccolls

• Decision Date: 01 October 1881
• Citation: 104 U.S. 757,26 L.Ed. 917
• Parties: BRITTON v. NICCOLLS
• Court: U.S. Supreme Court

104 U.S. 757

104 U.S. 757

26 L.Ed. 917

BRITTON v. NICCOLLS.

October Term, 1881

ERROR to the Circuit Court of the United States for the Southern District of Mississippi.

The facts are stated in the opinion of the court.

Mr. James Lowndes and Mr A. H. Handy for the plaintiff in error.

Mr. William L. Nugent for the defendant in error.

MR. JUSTICE FIELD delivered the opinion of the court.

The defendant in the court below is the surviving partner of the firm of Brt ton & Koontz, which was engaged in the banking business at Natchez, in the State of Mississippi, in 1874 and 1875. The plaintiff in the court below, Niccolls, was at that time a citizen of Illinois, and the present suit is brought by him to recover damages from the surviving partner of the firm for its neglect to present for payment to the maker, at their maturity, two promissory notes sent to it for collection, by reason of which the liability of a responsible indorser was released.

The facts in the case are briefly these: In April, 1874, the plaintiff was the holder of a promissory note of one John I. Lambert for $3,666.66, dated at Natchez, April 24, 1872, and payable to his order two years after date, with interest at the rate of eight per cent per annum. The note was indorsed by three parties besides the payee,—J. M. Reynolds, John Flemming, and J. S. Everet. Flemming's indorsement was without recourse to him; the other indorsements were without any such restriction upon the liability of the parties.

In April, 1874, the plaintiff caused this note, to be sent, through a banking-house in Bloomington, Illinois, to the firm at Natchez for collection. The only instructions accompanying it were that it was to be collected if paid, and if not paid on presentment it was to be protested and notice of non-payment sent to the indorsers.

In April, 1875, the plaintiff was the holder of another note of the same maker, identical in amount, date, and terms with the first, except that it was payable in three years after date; and it was indorsed in like manner by the same indorsers. This note matured on the 27th of that month. Some days previously the plaintiff sent it to the firm at Natchez, with instructions to collect it if paid, and if not paid to have it delivered to a protesting officer for protest, and to give notice to the indorsers.

No information as to the residence of the maker was given to the firm with the notes; nor does it appear that either member of it had, then or subsequently, any knowledge on the subject. The plaintiff himself was ignorant of it. He resided, in fact, on his plantation, twelve or fifteen miles from Natchez; he had no domicile or place of business in that city. The notes not being paid at their respective maturities,—the first one on the 27th of April, 1874, and the second one on the 27th of April, 1874,—before the close of banking hours on those days, were handed by the firm to a notary-public of the county, with instructions to demand payment of them, and if they were not paid to protest them and send notice of non-payment to the indorsers. No other directions were given. The notary knew that the maker resided on his plantation, and had no place of business in the city; but he inquired for him at the post-office, the city hall, and the court-house,—three of the most public places there,—and, not finding him, protested the notes for non-payment, and gave notice thereof to the indorsers.

The plaintiff soon afterwards brought suit against the maker and also against the indorser, Everet, which proceeded to judgment and execution; but nothing was obtained from the parties. Suit was also brought against Reynolds, the first indorser, in which judgment passed for the defendant, on the ground that due presentment of the notes to the maker and demand of payment had not been made at their maturity, by reason of which the indorser was released from liability. It is admitted that if judgment had been rendered against Reynolds, the money due upon the notes might have been collected upon execution. The plaintiff thereupon brought the present action.

The notary testified that, in his endeavors to make presentment of the notes for payment, he had acted upon his own opinion as to his duty, without instruction from the firm; and because he considered that the notes, being dated at Natchez, and no place of payment being stated, the place of presentment was, in law, at Natchez, and not at the marker's domicile outside of the city.

The surviving partner, Britton, testifid that it was always the custom of the firm, when it had notes for collection, whether its own or those belonging to others, to send through the post-office a notice of their amount and of the date of their maturity to the proper parties, a reasonable time before the notes became payable, and if payment was not made at their maturity, to place them in the bands of a notary for presentment and protest; that this course was pursued with respect to the notes in question; that Koontz, the deceased partner, who, it would seem, took special charge of the business of protesting paper left with the firm for collection, when that was necessary, had inquired of several persons coming into the banking-house as to the residence of the maker of the notes, and on one occasion left the house for the express purpose of trying to ascertain it, and returned stating that he had not succeeded; and that 'the notary would have to comply with the law in such cases, and present at several of the most public places.' He also testified that he was 'certain that Koontz made diligent efforts to ascertain Lambert's (the maker's) place of residence, and that they were unsuccessful.'

Upon the facts and testimony as stated, the defendant, among other things, requested the court to instruct the jury, in substance: that if the bankers had no knowledge of the residence or place of business of the maker, and were unable, after diligent inquiry in the city of Natchez, to ascertain the same, and thereupon, at the maturity of the notes, handed them to a notary-public for the purpose of having presentment made thereof to the maker for payment, and of having them protested in case of non-payment and notice thereof given to the indorsers, then the bankers were not liable for negligence in performing the duties intrusted to them, nor for failure of the notary to discharge the duties required of him with respect to the demand of payment.

We do not give the precise language of the instruction asked, but only its substance and purport. The court refused it, and instructed the jury, in substance: that if it was the duty of the bankers to perform such acts as the law required to charge the indorsers upon the notes, which were to present them to the maker for payment on their last days of grace respectively, and upon non-payment to give notice thereof to the indorsers; and that the bankers were not exonerated from this duty by the delivery of the notes to the notary for their performance, unless it was within a reasonable time for him to present the notes to the maker, and to demand payment, on the days they respectively became due, at his residence or place of business. To the refusal of the instruction asked, and to those given, an exception was taken. The plaintiff recovered judgment for the amount due on the notes, and the case is brought here for review.

The notes being dated at Natchez, the presumption of law, in the absence of other evidence on the subject, is that that was the place of residence of the maker, and that he contemplated making payment there. The duty of the bankers as collecting agents was, therefore, to make inquiry for his place of business or residence in that city, and if he had either to make there the presentment of the notes, but if he had neither to use reasonable diligence to find him for that purpose; or if the employment of a notary-public for that object was sanctioned by the usage of bankers, or by the law as declared by the courts of the State, instead of making the presentment and demand personally, they could have placed the notes in his hands for the performance of that duty. As it turned out that the maker had neither domicile nor place of business in the city, and was absent at the time from it, no demand upon him there was possible, nor was that essential to charge the indorsers.

The law on this subject we consider to be well settled, as will be seen by an examination of the numerous adjudged cases as to what constitutes due presentment and demand of payment of commercial paper, and...