James Hewitt was originally made a defendant, but the action as to him was discontinued, and this action is against Richard Hewitt, the payee-indorser.

The plaintiff testified that the defendant was owing the plaintiff, and that it was understood between them that when these notes were passed over by him in payment, that they were taken solely upon his responsibility, and that he assured plaintiff that they should be paid.

The action was to charge defendant as guarantor. No presentation to the maker for payment or notice of non-payment to Hewitt was shown. The court below held the suit could not be maintained, and dismissed the complaint. Plaintiff appeals.

MASON, J. - This action was brought to recover of the defendant the amount of two non-negotiable notes of seventy-five dollars each, upon the following facts: One William Ryan made the notes payable to defendant by name, and the defendant transferred the notes to the plaintiff for value, and indorsed them over by writing his name upon the back. The notes were not presented for payment when they fell due, nor was any notice of non-payment given to the defendant, and the only question in the case is whether the plaintiffs are entitled upon these facts to recover of the defendant the amount of the notes. The case of Richards' Ex'r v. Warring (1 Keyes R. 575), is an authority in point, and decides the very question in favor of the plaintiff. The case holds that the holder may overwrite the indorser's name with a contract of guaranty, or as maker of the note. That case must be regarded as controlling, even should we think the sons assigned for the decision unsatisfactory.

5

The judgment of the Supreme Court must be reversed and a new trial granted, with costs, to abide the event."

5 This was a case of "irregular indorsement."-- H.

• Accord: Sweetser v. French, 13 Met. (Mass.) 262; Prentiss v. Danielson, 5 Conn. 175; Castle v. Candee, 16 Conn. 223; Ford v. Mitchell, 15 Wis. 304. A payee-indorser in blank of a non-negotiable note becomes liable, not as indorser, but if at all as guarantor. In some states no presumption arises that any liability is undertaken, the indorsement being treated simply as a transfer or assignment of a common-law contract. Shaffstall v. McDaniel, 152 Pa. St. 508; Story v. Lamb, 52 Mich. 525. But evidence of the true contract is admissible. (Ibid.) An indorsement of a non-negotiable note waiving protest" is an indication of an intention to assume the liability of guarantor. First N. B. v. Falkenhan, 94 Calif. 141.

The indorser becomes liable only to his immediate indorsee, and not to a remote indorsee. Kendall v. Parker, 103 Calif. 319. Contra: Wareham Bank v. Lincoln, 3 Allen (Mass.), 192 (semble).

An irregular indorser of a non-negotiable note is a guarantor. Richards' Ex'r v. Warring, 1 Keyes (N. Y.), 576; McMullen v. Rafferty, 89 N. Y. 456; First N. B. v. Babcock, 94 Calif. 96; Orrick v. Colston, 7 Gratt. (Va.) 189. See on non-negotiable notes. Story on Prom. Notes, §§ 128-129; 2 Randolph on Comm. Paper, §§ 655-661.-H.

NEGOT. INSTRUMENTS- -46

II. Checks.

§ 321

1. CHECK DISTINGUISHED FROM BILL OF EXCHANGE.

HARRISON v. NICOLET NAT. BANK.

41 MINNESOTA, 488. - 1889.

APPEAL by plaintiff from an order of the District Court for Hennepin county, Rea, J., presiding, sustaining a demurrer to the complaint. The action was to recover $20,000 damages for that the defendant, on April 14, 1888, and before the maturity thereof, did "falsely, wrongfully, and maliciously" cause to be protested the following instrument, which had been indorsed and forwarded to defendant for collection, thereby injuring plaintiff's credit, etc.: 45 Washington Ave., South, HARRISON, the TAILOR.

$199.92.

MINNEAPOLIS, Minn., Mch. 27, 1888.

On April 14th pay to the order of E. Harrison one hundred and ninety-nine 92-100 dollars.

TO CITIZENS' BANK.

Minneapolis, Minn.

No. 2,884.

J. T. HARRISON.

MITCHELL, J. — This appeal presents the question whether a written order on a bank or banker to pay a sum of money at a day subsequent to its date, and subsequent to the date of its issue, is a "check," or a "bill of exchange," and hence entitled to grace. The question is one which has given rise to considerable discussion and some conflict of opinion.

About all the law there is on it, as well as all the arguments on each side, will be found in Morse, Bank (3d ed.), § 381 et seq. The two principal authorities holding such an instrument a check are In re Brown (2 Story, 502), and Champion v. Gordon (70 Pa. St. 474). Both of these are entitled to great weight, but they stand almost alone; the supreme courts of Rhode Island (Westminster Bank v. Wheaton, 4 R. I. 30), and perhaps of Tennessee, being, so far as we know, the only ones which have adopted the same views. All other courts which have passed upon the question, as well as the textwriters, have almost uniformly laid it down that such an instrument is a bill of exchange, and that an essential characteristic of a check is that it is payable on demand. This was finally settled, after some conflict of opinion, in New York,- the leading commercial state of the Union, in the case of Bowen v. Newell, several times before the courts, 5 Sandf. 326; 2 Duer, 584; 8 N. Y. 190, and 13 N. Y. 290, 64 Am. Dec. 550. (See, also, Morrison v. Bailey, 5 Ohio St. 13, 64

7 See also Way v. Towle, 155 Mass. 374. — H.

Am. Dec. 632; Woodruff v. Merchants' Bank, 25 Wend. 673; Minturn v. Fischer, 4 Cal. 35; Bradley v. Delaplaine, 5 Har. [Del.] 305; Georgia National Bank v. Henderson, 46 Ga. 487; Ivory v. Bank of State of Mo., 36 Mo. 475, 88 Am. Dec. 150; Work v. Tatman, 2 Houst. 304; Hawley v. Jette, 10 Or. 31; 2 Daniel Neg. Inst., §§ 1573-1575; Morse, Bank., supra.)

Nearly every definition of a check given in the books is to the effect not only that it must be drawn on a bank or banker, but that it must be payable on demand. (1 Rand. Com. Paper, § 8; Byles, Bills, 13; 2 Daniel, Neg. Inst., § 1566; 1 Edw. Bills, § 19; Bigelow, Bills and N., 116; Chalm. Dig. Bills and N., art. 254; Shaw, Ch. J., in Bullard v. Randall, 1 Gray, 605; Bouv. Law. Dict.; Burrill, Law Dict.) Occasionally the expression is used "payable on presentation," but evidently-except perhaps in Story on Bills as synonymous with "payable on demand."

As the question is a new one in this state, we would not feel compelled to follow the majority if the better reasons were with the minority. Perhaps the weightiest argument in favor of holding such an instrument a check is the practical one advanced by Sharswood, J., in Champion v. Gordon, supra, viz., that if held to be a bill of exchange the holder might immediately present it for acceptance, and if not accepted he could sue the drawer, or if accepted it would tie up the drawer's funds in the hands of the bank, and thus, in either case, frustrate the very object of making it payable at a future day. In answer to this, it may be said that the drawer, if he wished, could very easily avoid such consequences by inserting appropriate provisions in the instrument. On the other hand, if we hold that an instrument not payable on demand may be a check, we are left without any definite or precise rule by which to determine when the paper is a check, and when a bill of exchange. The fact that it is drawn on a bank is not alone enough to distinguish a check from a bill of exchange, for nothing is better settled than that a bill of exchange may be drawn. on a banker. Neither will the fact that the maker writes it on a "blank check" be any test, for the kind of paper it is written on cannot control the import and legal effect of its words. Neither can the question whether it is drawn against a previous deposit of funds by the drawer with the drawee furnish any criterion, for nothing is clearer than that a bill of exchange, as well as a check, can be drawn against such a deposit, and that an instrument may be a check although the drawer has no funds in the hands of the drawee. Neither will it do to say that if it is entitled to grace it is a bill, but if not entitled to grace it is a check, because the legal character of the instrument has first to be determined before it can be known whether or not it is entitled to grace. In short, if we omit from the definition of a check the element of its being payable on demand, bankers and business men are left without any definite rule by

which to govern their action in a matter where simplicity and precision of rule are especially desirable. It might be expedient to enact, as has been done in New York and some other states, that all checks, bills of exchange, or drafts, appearing on their face to be drawn on a bank or banker, whether payable on a specified day or any number of days after date or sight, shall be payable on the day named in the instrument without grace; or, what might be better still, to abolish days of grace altogether as a usage which has already long outlived the condition of things out of which it had its origin. But this is a matter for legislatures and not for courts. We are therefore of opinion that the better rule is to hold that such an instrument is a bill of exchange, and hence entitled to grace. We may add that it is always desirable that the decisions of the courts should be in accord with the business usages and customs of the country. Such usages are entitled to special weight on a question like this, for the whole matter of grace on bills and notes had its origin in the usage of bankers. And, so far as we are advised, the general practice of bankers in this state has been to treat instruments like this as bills of exchange and not checks.

Counsel for respondent suggests that, even if we hold that payment of this paper was demanded and protest made prematurely, yet the action of the court below in sustaining the demurrer to the complaint should be affirmed on other grounds, viz., that the act of protesting, etc., was the act of the notary and not of the bank; that the protest could not have damaged the financial standing of the plaintiff because the certificate of the notary shows on its face that it was done before maturity; also, that the instrument, being of doubtful classification, involving a legal question on which courts. differed, the defendant would not be liable for an honest mistake of law. Whatever force there might be in these suggestions, either by way of defense or in mitigation, we think they are unavailing in support of a demurrer to a complaint which alleges that the defendant "falsely, wrongfully and maliciously caused" the paper to be protested for non-payment, and notices of protest sent out, and which also shows that such notices which were presumably what, if anything, injured plaintiff's standing and credit-contained nothing indicating that payment was prematurely demanded.

Order reversed."

A post-dated check is to be distinguished (outside of Mass., Pa., and R. I.), from a check payable by its terms after the date of issue. 2 Daniels, §§ 1577-1578; Crawford v. West Side Bank, 100 N. Y. check is to be treated as if issued on the day of its date. Printing, Etc., Co., 24 Hun, 281, 90 N. Y. 678.-H.

56. A post-dated Frazier v. Trow's,

ა 322

2. PRESENTMENT OF CHECK.

(a) Effect of delay upon drawer's liability.

GRANGE v. REIGH.

93 WISCONSIN, 552.1896.

ACTION against the drawers of a check. Defendants, after banking hours on July 20, drew and delivered to plaintiff in Milwaukee, where plaintiff resided, a check for $1,211 upon the South Side Savings Bank, located in Milwaukee. The check was not presented on July 21, during all of which day the bank was open and would have paid the check had it been presented. The bank did not open after July 21, by reason of which the check was not paid. Judgment for defendants.

MARSHALL, J.-The settled law applicable to the facts of the case is that, if a person receives a check on a bank, he must present it for payment within a reasonable time, in order to preserve his right of recourse on the drawer in case of non-payment by the drawee; and that, when such person resides and receives the check at the same place where such bank is located, a reasonable time for such presentation reaches, at the latest, only to the close of banking hours on the succeeding day, excluding Sundays and holidays. (Tiedeman, Com. Paper, § 443; 2 Daniel, Neg. Inst., §§ 1590, 1591, and cases cited; Lloyd v. Osborne, 92 Wis. 93.) Plaintiff failed to comply with the law in this respect; hence defendants were discharged from all liability to answer for the default of the bank. Such was the decision of the trial court, and it must be affirmed.

It was held in Lewis, Hubbard & Co. v. Montgomery Supply Co., 59 Va. 75, that failure to present a check does not bar recovery from the drawer, if the time intervening between delivery thereof and the failure of the bank, is not sufficient for presentment by the exercise of such diligence as the law requires, citing Cox v. Boone, 8 W. Va. 500.- C.

1 But delay which occasions no loss to the drawer will not discharge the drawer; in this respect a check differs materially from a bill of exchange. Syracuse, etc., R. R. v. Collins, 57 N. Y. 641; Woodin v. Frazee, 38 N. Y. Super. Ct. 190; Cogswell v. Savings Bank, 59 N. H. 43; Bull v. Bank, 123 U. S. 105; 2 Morse on Banks, § 421; 2 Daniel on Neg. Inst., § 1587.

A banker's draft, that is a check or draft by one bank upon another, need not be presented with the same promptitude as the check of an individual; it is intended to circulate for a limited period. Bull v. Bank, 123 U. S. 105; 2 Daniel, § 1595a.

The rule of diligence as to notice of dishonor and the rules as to excuses for delay, etc., are the same as in the case of bills and notes. 2 Daniel, §§ 1596– 1598; 2 Morse, § 428.

An indorser of a check is entitled to due presentment and notice, and the