Trusts & Guarantee Co. v. Barnhardt

• Decision Date: 14 April 1936
• Citation: 270 N.Y. 350,1 N.E.2d 459
• Court: New York Court of Appeals Court of Appeals
• Parties: TRUSTS & GUARANTEE CO., Limited (formerly Union Trust Co., Limited), et al. v. BARNHARDT.

270 N.Y. 350

1 N.E.2d 459

TRUSTS & GUARANTEE CO., Limited (formerly Union Trust Co., Limited), et al.

v.BARNHARDT.

Court of Appeals of New York.

April 14, 1936.

Action by the Trusts & Guarantee Company, Limited (formerly Union Turst Company, Limited), and another, executors of the last will and testament of Samuel V. Venning, deceased, against William N. Barnhardt. From a judgment of the Appellate Division (Union Trust Co. v. Barnhardt, 245 App.Div. 829, 281 N.Y.S. 40), which reversed a judgment of the Supreme Court, Trial Term, for plaintiffs and ordered a new trial, plaintiffs appeal and stipulate for judgment absolute in case of affirmance.

Order of Appellate Division reversed, and judgment of trial court affirmed. Appeal from Supreme Court, Appellate Division, Second department.

Robert H. Koehler, of New York City, for appellants.

Guy O. Walser, of Sayville, and Howard J. Grace, of Bayshore, for respondent.

HUBBS, Judge.

This is an action to recover upon a demand promissory note made by Newton Wylie to the order of Samuel V. Venning, deceased, and indorsed by respondent. A verdict was directed for plaintiffs-appellants. The Appellate Division reversed and ordered a new trial upon the ground that it was error to refuse to receive testimony offered by respondent to the effect that he never received notice of dishonor and protest.

The note was made and payable in Toronto, Canada. It is conceded that the Canadian law controls and the Canadian statute was introduced in evidence. It does not differ in effect from our Negotiable Instruments Law (Consol.Laws, c. 38). Under both statutes, a plaintiff makes a case against an indorser by proof of the indorser's signature, the production of the note, and the introduction in evidence of the notary's certificate showing the dishonor of the note and the mailing of the notice of protest.

The question presented for determination is whether testimony by a defendant indorser to the effect that he never received the notice of dishonor and protest raised a question of fact as to whether it was in fact mailed to him as certified by the notary in his certificate. If such testimony did not raise an issue of fact, the trial court was right in refusing to receive such testimony. On the other hand, if it did raise a material question of fact, the judgment of the Appellate Division must be affirmed.

It is a general rule that the law presumes that a letter, properly addressed, stamped, and mailed, is duly delivered to the addressee. Calkins v. Vaughan, 217 Ala. 56, 114 So. 570;News Syndicate Co. v. Gatti Paper Stock Corp., 256 N.Y. 211, 176 N.E. 169.

That presumption applies in an action against an indorser of a note both under the common-law rule and under Canadian and New York statutes. Statutes making the certificate of a notary competent evidence do not preclude evidence, however, to the effect that a certificate of a notary is false in its statement that a notice was mailed. The falsity of such a certificate may be shown like any other material fact in a case by any competent evidence and as bearing on that question of fact evidence that the notice was not received would undoubtedly be competent.

The question still remains whether the testimony of an indorser that he did not receivethe notice standing alone is sufficient to raise a question of fact which must be sent to a jury.

In some jurisdictions it has been decided that such evidence is sufficient to create a question of fact. Calkins v. Vaughan, supra; Kewanee Nat. Bank v. Ladd, 175 Ill.App. 151; Radin v. Creran, 106 N.J.Law 460, 148 A. 735.

The same rule has been announced by some courts in this state although the question has never been passed upon by this court. Union Bank v. Deshel, 139 App.Div. 217, 123 N.Y.S. 585;Latham v. Sheff, 193 App.Div. 576, 185 N.Y.S. 278;Reardon v. Olympic Theatre Corp., 231 App.Div. 875, 246 N.Y.S. 862.

In Canada the rule seems to be that a mere denial of the receipt of the notice does not create a question of fact.

A Canadian authority, Falconbridge on Banking and Bills of Exchange (4th Ed., p. 486), says a mere denial of receipt is not an answer.

Other jurisdictions have adopted the rule that a mere denial of receipt of a notice does not create an issue of fact. Bovay v. Fuller (C.C.A.) 63 F.(2d) 280;Bittenbender Co. v. Bergen, 277 Pa. 27, 120 A. 658;First Nat. Bank of Manistee v. Star Watch Co. of Ludington, 187 Mich. 224, 153 N.W. 722;Wilson v. Richards, 28 Minn. 337, 9 N.W. 872, 873;Roberts v. Wold, 61 Minn. 291, 63 N.W. 739.

The Canadian statute (Bills of Exchange Act, R.S. ch. 119) provides:

‘Section 11. A protest of any bill or note within Canada, and any copy thereof as copied by the notary or Justice of the Peace, shall, in any action be prima facie evidence of presentation and dishonor, and also of service of notice of such presentation and dishonor as stated in such protest or copy.’

‘Section 103. 2. Such notice so addressed shall be sufficient, although the place of residence of such party is other than either of the places aforesaid and shall be deemed to have been duly served and given for all purposes, if it is deposited in any...