State Bank v. Napier

• Decision Date: 31 December 1845
• Parties: STATE BANK v. NAPIER.
• Court: Tennessee Supreme Court

25 Tenn. 270

STATE BANK

v.NAPIER.

Supreme Court of Tennessee.

December, 1845.

This is an action on the case brought by Napier against the State Bank, in the circuit court of Davidson county, for the purpose of rendering the bank liable for neglect of duty, whereby the endorsers on a note deposited in bank for collection were discharged. The case was tried by Judge Maney and jury of Davidson county, at the May term, 1835, of the circuit court, and a verdict and judgment rendered for the amount of the note and interest. The defendant appealed.

A. Ewing, for plaintiff in error.

He cited Story on Prom. Notes, 289, 290; 2 Hall, 118; 2 Pet. 549;1 Id. 617;18 Pick. 66;6 Mass. 525.

Smith and Cox, for defendant in error.

See Wheat. 176; H. Black. 509.

Turley, J., delivered the opinion of the court.

This is an action against the Bank of the State of Tennessee, on the part of the defendant in error, to recover damages for a default in the bank in presenting a note for payment, which had been deposited in it for collection, in the words and figures following, viz.:

“Six months after date I promise to pay Thos. S. Marshall or order, at the Bank of Tennessee, at Nashville, four hundred and fifty dollars, for value received. Witness my hand and seal.

Nashville, March 20th, 1841. S. B. Marshall. [Seal.]”

This note was endorsed by Thomas S. Marshall, John Trimble, and A. R. Nichol. The proof as contained in the bill of exceptions shows that, on the 20th day of September, 1841, the note was placed in the hands of Alex R. Nichol, the last endorser, by the agent of Charlotte Napier, the plaintiff in the circuit court, which was on the same day deposited in the bank for collection, with his endorsement to the bank. This was the day on which the note fell due, excluding the days of grace. The note was deposited with the proper officer of the bank to receive it. On the third day of grace, when the note by commercial usage was payable, the officer of the bank who received it neglected to place it in the hands of the officer whose business it was on that day to hold all notes payable at that time in bank, and receive payment if the payors presented themselves for the purpose of making it. The consequence was that the note, not having been paid, was not handed out that evening to the notary public for protest, but was on the next morning duly protested for non-payment, and notice thereof given in due form to the endorsers.

The proof also shows that no person on the third day of grace called to pay the note, and that the payor had no funds in the bank to meet the same, though the books of the bank were not at that time turned to for the purpose of ascertaining the facts.

Upon this statement of facts the court charged the jury “that, if the note in question was regularly deposited in bank for collection, the bank was bound to demand payment of the same on the last day of grace at their banking-house, and, in case the same was not paid within banking hours, to give due notice to the endorsers of the non-payment of said note; that it was not necessary that any particular form of words should be used in making such demand, nor in fact that such words should be used at all, but that in his opinion it would not be a sufficient demand of payment that said note was in the banking-house on the day that the same was due, that no person called to pay it, and that the proper officer of the bank was ready, in case he had been called for, to deliver it to the party legally applying; but that something more should be done; some act that, for instance in the present case, the books of the bank should have been examined to see whether the maker had not sufficient funds to pay said note in the bank, and that this should have been done on the day the note fell due. Upon this charge the jury found a verdict for the plaintiff, upon which the circuit court rendered a judgment, to reverse which this writ of error is prosecuted.

We have a case succinctly presented as follows:

A note is deposited in bank for collection on the day it falls due by its tenor, having three days of grace to run; it is deposited with the proper officer to receive it for collection. On the day it falls due, by commercial usage, to-wit, the third day of grace, ...