Merson v. Sun Ins. Co. of New York

• Court: New York City Court
• Writing for the Court: EDWARD J. GREENFIELD
• Citation: Merson v. Sun Ins. Co. of New York, 253 N.Y.S.2d 51, 44 Misc.2d 131 (N.Y. City Ct. 1964)
• Decision Date: 05 October 1964
• Parties: , 2 UCC Rep.Serv. 407 Erwin MERSON d/b/a Supreme Wine & Liquor Co., Plaintiff, v. SUN INSURANCE COMPANY OF NEW YORK, Defendant.

Page 51

253 N.Y.S.2d 51

44 Misc.2d 131, 2 UCC Rep.Serv. 407

Erwin MERSON d/b/a Supreme Wine & Liquor Co., Plaintiff, v. SUN INSURANCE COMPANY OF NEW YORK, Defendant.

Civil Court of City of New York, Trial Term, Part 7.

Oct. 5, 1964.

Bernard S. Rogovin, Brooklyn, for plaintiff.

Richard Formidoni, New York City, Theodosis J. Totolis, New York City, of counsel, for defendant.

EDWARD J. GREENFIELD, Judge.

The draft issued by the insurance company in this case was a fully negotiable bill of exchange (Negotiable Instruments Law, §§ 20, 210). The words 'upon acceptance' meant acceptance by the drawee bank (Negotiable Instruments Law, § 220). These words did not render the instrument conditional, since presentment for acceptance may be required for any check or bill of exchange (Negotiable Instruments Law, § 240; cf. Uniform Commercial Code, § 3-410(2). A trade acceptance has always been deemed a negotiable instrument (Citizens' Trust Co. of Utica v. R. Prescott & Son, Inc., 221 App.Div. 420, 422, 223 N.Y.S. 184, 187; Atterbury v. Bank of Washington Heights, 241 N.Y. 231, 239, 149 N.E. 841, 844; Mintz v. Kerry, 7 Misc.2d 76, 160 N.Y.S.2d 271; 11 American Jurisprudence 2d §§ 15, 146); a banker's acceptance even more so. Non-acceptance may be signified by the drawee bank either because it does not have sufficient funds of the drawer, or because the drawer has instructed it not to pay--exactly as in the case of a negotiable check or note.

Plaintiff, to whom the instrument was endorsed by the payee, took without notice of any defect, and is a holder in due course. The drawee bank did not irrevocably accept the draft by notification or delivery despite its...