Lathrop v. Lawson, 5 La. Ann. 238, 52 Am. Dec. 585, Follain v. Dupre, 11 Rob. 454, Waldron v. Turpin, 15 La. 552, 35 Am. Dec. 210, and Burke v. McKay, 2 How. 71, 11 L. Ed. 181.

The two notes due in January and March, 1862, could not have been presented for payment to the drawer at the time and place of their respective maturity, but a demand should have been made, etc.. as soon after as was practicable. Pothier, Fouté du Contrat de Change, partie 1, c. 5, § 144.

No valid excuse is shown for the nonperformance of the requisites of the law, as to demand and notice, in regard to the notes which fell due in 1863.

We concur, therefore, with the judge of the district court that the holder of the notes which matured in 1862 and 1863, by his negligence and want of diligence, has lost all recourse against the indorser of them.

The two notes payable in 1864 stand upon a different footing. It is true they were not protested until many months after their maturity; but by the President's proclamation of March 31, 1863, commercial intercourse was interdicted until the end of the rebellion, which was virtually suppressed in the month of May, 1865, by the surrender to the United States forces of the last of the Confederate armies.

Two months elapsed between that event and the date of the protest, and, under ordinary circumstances, that unnecessary delay would have been fatal; but it seems that no administrator was appointed to the succession of Robert Many until the very day on which the protest was made. Under the commercial law, which in cases like this is not in conflict with the positive injunctions of our statutes, neither demand nor notice are required until a reasonable time after the appointment of an administrator. See Story on Promissory Notes, § 250, and Parsons on Bills and Notes, p. 360.

No laches is imputed to the administrator, and, as the indorser was duly and legally notified of the protest of the notes due in 1864, he is liable therefor.

For the reasons assigned by the judge of the lower court, and those now given by this court

It is ordered, adjudged, and decreed that the judgment of the district court be affirmed, at the costs of the appellant.1

14 See, also, Wilson v. Senier, 14 Wis. 411 (1861), delay incident to the holder's sickness; Windham Bank v. Norton, 22 Conn. 213, 56 Am. Dec. 397 (1852); Pier v. Heinrichshoffen, 67 Mo. 163, 29 Am. Rep. 501 (1877), delay in the mails.

PATTERSON v. TODD & LEMON.

(Supreme Court of Pennsylvania, 1852. 18 Pa. 426, 57 Am. Dec. 622.)

This was a suit before a justice of the peace, by Todd & Lemon against George W. Patterson, indorser of a promissory note, as fol

lows:

"Sixty days after date, I promise to pay to G. W. Patterson, or order, the just and full sum of fifty-eight dollars and sixty-two cents, for value received. Witness my hand and seal, 16th day of December, 1841. 58.62 [Signed] John S. Wilt.

1.17, 4 months' interest.

$59.79."

Indorsed:

"George W. Patterson, per Samuel M. Greer.

"For value received, we assign the within note to Wm. K. Piper,

and do guaranty the payment of the same.

“June 1, 1842.

The trial court charged in part as follows:

Todd & Lemon."

"The claim is upon the alleged indorsement; and the plaintiff's must recover upon that indorsement, if at all. They do not claim, and cannot claim, to recover in their name on any guarantee given by Patterson to Barr.

"Was the note indorsed by Patterson, and indorsed after due? This is a question of fact for you. If it was, it thence went into circulation on the credit of the indorser. Such indorsement is to be considered as the making of a new note, and imposing on the indorser the primary obligation of a drawer; and to charge him demand and notice need not be shown. Jordan v. Hurst, P. L. J. vol. 9, p. 258. If Patterson indorsed the note after it was due, then the plaintiffs are, therefore, entitled to a verdict for its amount, with interest; otherwise they are not. The question of fact is for you."

The defendant excepted. Verdict for the plaintiffs. The defendant brings error.15

LEWIS, J. The questions for decision in this case have relation to the effect of indorsing a promissory note overdue. (1) What is the contract which the law implies from such an indorsement? (2) Is the implied contract subject to modification by parol evidence of the special agreement made by the parties at the time of the transaction? In 1816, Chief Justice Parker, in Field v. Nickerson, 13 Mass. 131, considered it remarkable that the law on so familiar a contract as the indorsement of a note on demand should at that late period be doubtful; and it is certainly to be regretted that on a kindred, if not the identical, question it remains in the same condition in Pennsylvania.

15 The statement of the case is abridged, and the arguments of counsel are omitted.

The law of bills of exchange seems to be well understood. Every business man knows that, when he receives an inland bill of exchange, it is his duty to present it for payment, at maturity, if payable at a particular time; or, within a reasonable time, if payable at sight; and, in either case, to give immediate notice to the drawer, if the bill be dishonored. If these duties be neglected by the holder, the drawer is, in general, discharged from all further liability on the bill. It is also well understood, among the learned and unlearned, that the rules of the law merchant which regulate the liabilities of the parties on bills of exchange apply also to the indorsement of promissory notes. The indorser of a note is considered as the drawer of a bill of exchange upon the maker, and the body of the note is referred to for the purpose of showing the sum to be paid, the time and place of payment, and the fact that the bill is already accepted by the maker of the note, whose signature thereto, places him, as between the indorsee and himself, in the condition of a drawee of a bill of exchange. after acceptance. Where a note is indorsed before it is due, the holder must present it for payment at maturity, and in case of default must give immediate notice of the dishonor. But, after the note becomes due, it is payable whenever the holder chooses to demand it, and for this purpose an action at law is a sufficient demand, as between the maker and holder. Like a contract for the payment of money, where no time of payment is specified, it is legally payable presently. So that, when such a note is indorsed, the indorser still stands in the condition of the drawer of an inland bill of exchange; and we refer to the note, as before, for the purpose of ascertaining the amount, and the time and place of payment. The time of payment having passed, the note is, in law, payable on demand, and this shows that' the indorsement is to be considered as if made upon a new note payable on demand, and the legal effect of it is precisely the same as if the indorser had drawn an inland bill of exchange upon the maker, payable at sight. It is the duty of the holder of such a bill to present it for payment within a reasonable time, and if the bill be dishonored. to give immediate notice thereof to the drawer. In the case of an indorsement of a note overdue, the holder is, in like manner, bound to present it for payment within a reasonable time, and, in case of nonpayment, to give immediate notice of the dishonor to the indorser, otherwise the latter is discharged from liability. This doctrine is fully sustained by the authorities.

It is stated in Chitty on Bills, 15, 16, that a bill may legally be indorsed after it is due and has been dishonored, but not after it has been paid by the acceptor (Mutford v. Walcot, 1 Ld. Raym. 575; Dehers v. Harrid, 1 Show. 163; Callow v. Lawrence, 3 Maule & S. 97; Beck v. Robley, 1 H. Bl. 89 n; Hubbard v. Jackson, 1 Mo. & P. 11), and that a bill, indorsed after due, is equivalent to drawing a new bill payable at sight (Dwight v. Emerson, 2 N. H. 159; Rugley v.

Davidson, 2 Mill's Const. [S. C.] 33). But there is this distinction between notes, etc., indorsed after and before due: That in the first case the holder takes them subject to all the defenses to which they were subject in the hands of the original parties. Chitty on Bills, 15, 16. It may fairly be inferred, from Mr. Chitty's statement of the distinction between indorsements of bills after due and before due, that the only difference is that in the first case the holder takes them subject to all the equities which existed between the original parties, and in the last case he takes them discharged of all such defenses.

That the indorsement of a note overdue is equivalent to drawing a new bill payable at sight, upon which the indorser is liable only upon proof of a demand upon the maker within a reasonable time, and immediate notice of the default, is fully established by the following decisions made by the highest courts of our sister states, and pronounced by judges whose learning and experience in this particular branch of the law entitle their opinions to the highest regard: Poole v. Tolleson, 1 McCord (S. C.) 199, 10 Am. Dec. 663; Ecfert v. Des Coudres & Co., 1 Mill, Const. (S. C.) 70; Course & McFarlane v. Shackleford's Adm'rs, 2 Nott & McC. (S. C.) 283; Bishop v. Dexter, 2 Conn. 419; Field v. Nickerson, 13 Mass. 131; Colt et al. v. Barnard, 18 Pick. (Mass.) 260, 29 Am. Dec. 584; Berry v. Robinson, 9 Johns. (N. Y.) 121, 6 Am. Dec. 267; Agan v. McManus, 11 Johns. (N. Y.) 180; Leavitt v. Putnam, 3 N. Y. 494, 53 Am. Dec. 322; Id., 1 Sandf. (N. Y.) 199; McKinney v. Crawford, 8 Serg. & R. (Pa.) 353; Brenzer v. Wightman, 7 Watts & S. (Pa.) 265.

The cases which are supposed to conflict with this view of the subject, and to sustain the position that the contract of indorsement, when made upon a note overdue, changes its character, and becomes an original and unconditional engagement to pay the amount, are: Brown v. Davies, 3 T. R. 80; Bank of N. America v. Barriere, 1 Yeates (Pa.) 360; Leidy v. Tammany, 9 Watts (Pa.) 353; and Jordan v. Hurst, 2 Jones (Pa.) 269. In Brown v. Davies, the only question was whether the maker, in an action against him by an indorsee, could be permitted to prove a payment to the payee before the indorsement. No question touching the liability of the indorser arose in the cause, or was decided by the court; and the misapprehension which has since occurred in relation to some of the loose remarks of one of the judges on a question to which his attention was not drawn, and on which he did not feel called upon to speak with precision, shows the danger of relying upon such obiter dicta as authority for anything. The case of Bank v. Barriere, 1 Yeates (Pa.) 360, was decided by a single judge, upon its own special circumstances, and has not only been so explained and understood, but it was solemnly decided by this court, nearly 30 years ago, that it furnished no authority for the doctrine that the conditional contract of indorsement may be tortured into an original unconditional engagement. McKinney v. Crawford, 8 Serg. & R. (Pa.) 351. The case of Leidy v. Tammany, 9

Watts (Pa.) 353, like that in 1 Yeates, 360, was properly decided upon its special circumstances; and the observations of the judge, in going further than the case required, must not be received to unsettle the established rules of law.

There are other cases in which the erroneous idea that an indorsement of a note overdue is a new note seems to float in the minds of the judges; but the error arises from a want of precision in the language used in some of the early cases. When it was intended to say that such an indorsement was a new bill, payable at sight, the judge has been erroneously supposed to mean a new note payable on demand. The difference is so manifest as to need no explanation. In Jordan v. Hurst, 2 Jones (Pa.) 269, a demand was made upon the. maker of the note on the fourth day after the indorsement, and it was stated in the case "that the drawer [of the note] had no property or effects out of which the debt could be levied." There was no complaint of a want of diligence in making demand upon the maker of the note, and we do not propose to inquire into the propriety of the decision that his insolvency dispensed with the necessity of notice to the indorser. But it cannot be denied that the observations of the judge who delivered the opinion of this court in that case had a tendency to mislead the intelligent and excellent president who decided this cause in the court below. The observations of Mr. Justice Coulter lose much of their weight, however, when it is remembered that they extended to a question not necessarily arising in the case, that they are founded chiefly upon the cases already explained as not sustaining the position that an indorsement of a note overdue is a new note, and that the learned judge himself virtually abandons the posi tion when he concedes that the action against the indorser can only be sustained "after the original maker of the note has refused payment." This implies the necessity of a demand upon the maker, which is altogether repugnant to the idea that the indorsement is a new note. The interrogatories of Mr. Justice Duncan, in McKinney v. Crawford, 8 Serg. & R. (Pa.) 353, have never been satisfactorily answered. by those who desire to convert an indorsement into an absolute and unconditional engagement to pay the amount. "If it was a contract of absolute and immediate liability, why indorse? For what purpose. draw? Why not give his own note?" 8 Serg. & R. 353. We fully adopt the language of Mr. Justice Duncan, in the case last cited, in which he declares that "it is now a doctrine well settled that in the case of all notes, whether overdue or not, to render the indorser liable, there must be a demand on the maker and notice to the indorser, unless a contract of a different nature from that of indorsement is to be implied from the special circumstances, and the understanding of the parties at the time of the transaction." McKinney v. Crawford, 8 Serg. & R. (Pa.) 357. A note overdue and a note payable on demand are, in legal effect, identical, and therefore the decision in McKinney v. Crawford is a direct decision on the question involved in this case.