Robinson v. Lancaster Foundry Co.

• Decision Date: 13 January 1927
• Docket Number: 66.
• Citation: 136 A. 58,152 Md. 81
• Parties: ROBINSON v. LANCASTER FOUNDRY CO.
• Court: Maryland Court of Appeals

136 A. 58

152 Md. 81

ROBINSON v. LANCASTER FOUNDRY CO.

No. 66.

Court of Appeals of Maryland

January 13, 1927

Appeal from Baltimore City Court; Henry Duffy, Judge.

"To be officially reported."

Suit by the Lancaster Foundry Company against Harry L. Robinson. Judgment for plaintiff, and defendant appeals. Reversed without awarding a new trial.

Argued before BOND, C.J., and URNER, ADKINS, OFFUTT, and PARKE, JJ.

Theodore C. Waters, of Baltimore (Mullikin & Porter, of Baltimore, on the brief), for appellant.

Roger B. Williams and Raymond S. Williams, both of Baltimore (Hershey, Donaldson & Williams, of Baltimore, on the brief) for appellee.

PARKE J.

On the 14th day of October, 1921, the American Tool & Machine Company, by its promissory note of that date, promised to pay to the order of the Lancaster Foundry Company, appellee, the sum of $1,801.65, three months after date, with interest, at Bel Air road and Southern avenue, Baltimore, Md., for value received. The note was indorsed individually by Harry L Robinson, the appellant, for the accommodation of the maker of which he was the president. The payee negotiated the note at the Union Trust Company of Lancaster, Pa. When it was not paid at maturity, the payee paid the note to its holder, and endeavored, without success, to get the maker to pay. The maker having become bankrupt in June, 1922, the payee brought suit on the note against the indorser, Harry L. Robinson, and obtained judgment. Code, art. 13, § § 48, 82; Weant v Southern Trust Co., 112 Md. 471, 77 A. 289; Black v. First Nat. Bank of Westminster, 96 Md. 417, 54 A. 88; Jamesson v. Citizens' Bank, 130 Md. 84, 87, 99 A. 994, Ann. Cas. 1918A, 1097.

The note matured on Sunday, so that it became due on the following Monday, which was January 16, 1922. At the trial the appellee offered evidence tending to show that the holder of the note had forwarded it to the National Bank of Baltimore for collection, and that, at the close of the banking hours on Monday, the unpaid note was given to a notary, who protested the instrument and duly sent by mail the usual written notices of dishonor to the maker and indorsers.

The note and certificate of protest were in evidence, and the notary was asked by the appellant what it was she had done to enable her to certify in her certificate of protest that she had "presented the said note to the American Tool & Machine Company, Baltimore, Md., and upon demand for payment received answer, 'Mr. Robinson is not here.' "

Her explanation was that some time after 3 o'clock and prior to 4 o'clock on the afternoon of the Monday the note was payable, she did not go to Bel Air road and Southern avenue, Baltimore, which was the location of the place of business of the maker and the place where the note was made payable, but called the office of the maker by telephone asking for an officer of the corporation, and, upon making demand for payment of the note, received the answer, "Mr. Robinson is not here"; and upon that reply her protest was based. The notary did not know who the person was who answered the telephone, nor did this person have any means of knowing the notary or the capacity in which she was acting other than what the notary herself had said in the telephone message described. What has been here stated is the only proof of presentment, since appellant's testimony tended to establish that the office force consisted of two bookkeepers and a stenographer, and that the president, vice president, and a salesman had been also present at the office but not during the whole day, and that no communication by telephone had been received from the notary. There was the further testimony of the appellant, who was also the maker's president, that the maker was in a position to pay the note at maturity if it had been properly presented.

There is but one exception on this record, and it is to the refusal to direct a verdict for the indorser. The single question is, conceding the truth of the notary's evidence, Was there a presentment for payment sufficient, on the dishonor of the note, to bind a party secondarily liable? The notary had possession of the note and was the agent of the holder to receive payment on its behalf and the time she acted was at a reasonable hour on a business day, but the presentment was not complete (a) until the note had been presented at the place specified in the instrument (b) to the American Tool & Machinery Company, the party primarily liable on the instrument, or, if its proper officer had been absent or inaccessible, to any person found at the place where the presentment was to be made. Code, art. 13, § § 91, 92. The note expressly stipulated that it was to be paid at the place of business of the maker, at the corner of Bel Air road and Southern avenue, Baltimore. While presentment to the appellant as the president of the maker, at its designated place of business, would have fulfilled the remaining conditions of the presentment, his absence would not have released the agent of the holder from presenting the note to some other available accredited officer of the maker, as it is only upon the contingency of the absence or inaccessibility, at the place of presentment, of the person primarily liable that the holder or his agent may present the negotiable instrument to any person found at the place when the presentment is made. Supra. 5 Uniform Laws Ann. § 97, pp. 377, 378. In addition to the cited sections, the Negotiable Instrument Act declares that the instrument must be exhibited to the person from whom payment is demanded, and when it is paid, it must be delivered up to the party paying it. Section 93.

The purpose of presentment is to receive payment from the maker. The possession of the instrument for presentment and delivery upon payment is at once the opportunity of the maker to ascertain the amount due, and if the instrument be genuine and matured, and is, also, sufficient evidence of the authority of the person making the presentment to receive the money and surrender the paper. 2 Ames Cases on Bills and Notes, 337, 338. Thus the nature of the transaction contemplates the physical presence of the holder or his agent where the presentment is required to be made. While presentment for payment is not necessary to charge the person primarily liable on the instrument (Forwood v. Magness, 143 Md. 1, 5, 121 A. 855), yet it is necessary to charge the indorsers, except as (a) where the instrument was made or accepted for his accommodation and he has no reason to expect that the instrument will be paid if presented; (b) where after the exercise of reasonable diligence, presentment as required by the statute cannot be made; (c) when the drawer is a fictitious person; or (d) by an express or implied waiver of presentment. Code, art. 13, § § 89, 98, 99, 101. It is clear that the appellant does not come within the first three exceptions, and there was no express waiver of presentment, and, as will be shortly seen, no implied waiver.

The indorser is a party secondarily liable on the instrument and, although known to the holder at the time of taking the instrument as only an accommodation party, his contract with the holder, or with any subsequent indorser who may be compelled to pay the negotiable paper, is that the instrument, on due presentment, shall be accepted or paid, or both, as the case may be, according to its tenor, and that if it be dishonored and the necessary proceedings on dishonor be duly taken he will pay. Code, art. 13,§ § 15, 48, 82, 83, 85. Obviously the rights and liabilities of the holder and the indorser are contractual, and no right of either may be waived, except by himself as the party...