Lawrence v. Schmidt

• Citation: 35 Ill. 440,1864 WL 3072,85 Am.Dec. 371
• Parties: JOACHIM LAWRENCE, for the use of CALVIN DE WOLFv.JOHN SCHMIDT.
• Decision Date: 30 April 1864
• Court: Supreme Court of Illinois

35 Ill. 440

1864 WL 3072 (Ill.)

85 Am.Dec. 371

JOACHIM LAWRENCE, for the use of CALVIN DE WOLF

v.JOHN SCHMIDT.

Supreme Court of Illinois.

April Term, 1864.

APPEAL from Recorder's Court of Chicago.

Action brought by appellant against appellee upon the following check:

“CHICAGO, May 16, 1861.

EDWARD I. TINKHAM & Co.: Pay to Joachim Lawrence or bearer twenty-five dollars, and charge the same to account of

+-----------------------+
                ¦$25.00.¦JOHN SCHMIDT.” ¦
                +-----------------------+
                

The judgment of the court below was for the defendant; and the question raised upon this appeal is, whether the drawer of said check, who, when it was presented for payment, had on deposit with Tinkham & Co. nothing but depreciated bank bills, and who was not notified of the nonpayment of the check till after Tinkham & Co.'s failure, in June, 1861, had a right to be notified of such nonpayment before his liability was fixed.

Garrison & Blanchard, for appellant.A. J. Brown, for appellee.

WALKER, C. J.

According to the rules of the mercantile law, the drawer of a draft or check must have due notice of its dishonor before he can be held liable for nonacceptance or nonpayment. But he may waive such notice, or he may so act as to amount to a waiver of notice. It is always presumed that he draws upon funds in the hands of his banker, and hence the necessity of such notice, that he may protect his interest and secure his funds in the hands of the party on whom the bill is drawn. But when he has not drawn against funds, the necessity for notice does not exist. When he has not provided funds for the payment of the bill or check, he has no right to expect that it will be honored, and his interests do not require notice of nonacceptance or of nonpayment. In such a case he is presumed to have waived notice, and it need not be given to hold the drawer liable. It has even been held to be a fraud to draw a bill or check where no funds have been provided for its payment.

In the case of the Galena Insurance Company v. Kupfer, 28 Ill., 332, it was held that where a party draws for current funds, the payee is not bound to receive depreciated paper. A party drawing upon another must provide the funds, and the kind for which he draws, for its payment. If he fails to do so, it is the same as if no funds were provided. The payee, in a case where depreciated funds have been deposited, and his draft is for current funds, is not bound to receive the funds on deposit, nor is the...