We are of opinion that the written notice which the defendant alleges was delivered to him was not sufficient to charge him with the dishonor of the note. It was in proper form, signed by a notary, and was delivered in due time. But on its face it clearly discloses the fact that it was not intended for the defendant. It was directed to L. A. Marshall, the plaintiff, and the envelope containing it bore the same address. Marshall, like the defendant, was also an indorser of the note, and, if the holder intended to impose liability on him, it was necessary that he should have notice of dishonor. It is therefore apparent that this notice was intended for Marshall, and was, of course, for the purpose of apprising him of the dishonor of the note, and was prepared by the notary with that intention. The notary does not testify that at the time he delivered the envelope containing the notice he told the defendant what it contained or said anything to him concerning its contents. He did not apprise the defendant that the note had been dishonored or that the notice was intended for him. He gave the defendant no verbal notice whatever, and hence all the information the latter had of the dishonor of the note and the intention of the holder to guard his rights and to avoid responsibility by fixing liability on antecedent parties was what was contained in the envelope addressed to Marshall. This, as we have observed, was a notice to Marshall that the note "by you indorsed" was protested for nonpayment, "and that the holders look to you for the payment thereof."

Why should the defendant accept this as a notice of dishonor to him and take care of the note? There is no intimation in the paper that the holder intended to look to him for payment. On the contrary, the notice is that the holder will look to Marshall, his immediate prior indorser, for payment. This he had a legal right to do, and was not compelled to notify the defendant or any other indorser or to demand payment of him. If Marshall desired to hold the defendant responsible as a prior indorser it was incumbent upon him to give the latter notice of dishonor. The defendant was justified in treating the paper delivered to him by the notary as a notice to Marshall, as the address on the envelope and notice disclosed, and that the purpose was to notify Marshall of dishonor for the purpose of charging him with payment of the note. If either the envelope or the notice had been addressed to the defendant, or if neither had been addressed to him, the plaintiff's contention that the notice was for the defendant would have some ground for its support. If, when he delivered the paper, the notary had notified the defendant verbally that the note had been dishonored or that the written notice was for him, there would be sufficient to charge the defendant with notice of dishonor. But none of these facts can be found in the case. Assuming that the defendant opened the envelope and read its contents, he simply obtained the knowledge that the note was dishonored and that the holder would look to Marshall, the last indorser, for payment. This, as we have seen, is not sufficient under

the cases to fix the defendant, as an indorser, for the payment of the

note.

For the reasons above stated, the second assignment of error is sustained, and the judgment is reversed, with a venire facias de novo.

SECTION 6.—WHEN PRESENTMENT AND NOTICE OF DISHONOR UNNECESSARY

BARTON v. BAKER.

(Supreme Court of Pennsylvania, 1815. 1 Serg. & R. 334, 7 Am. Dec. 620.) Assumpsit by the plaintiff as indorsee of a promissory note, against the defendant as indorser.

It appeared in evidence at the trial that the note was drawn on the 2d June, 1808, by James Brown & Co., in favor of John Baker, the defendant, by whom it was indorsed, and that it was payable in four years after date; that the house of James Brown & Co., which was composed of James Brown and Armat Brown, was insolvent at the time the note was drawn, and continued to be so until it became due; that it was given for a debt previously contracted, and was received on the credit of Baker only; that several months before it was payable Armat Brown executed an assignment of all his estate, real and personal, to the defendant, to indemnify him for certain advances of money, and for indorsements on account of the firm of James Brown & Co. When the note became due, which was on the 2d and 5th June, 1812, James Brown was in Europe; but a demand for payment was made on Armat, who was then in this city, which not being complied with, it was protested. On the 15th of the same month, notice of nonpayment was given to the defendant, who observed that it was out of time, but did not deny that he was responsible, and said that his ability to pay would depend upon the arrival of a vessel.

Under these circumstances the defendant contended that the holder of the note had been guilty of such laches as to discharge the indorser from his liability to pay it.

His honor, Judge, Yeates, before whom the cause was tried, on 2d February, 1814, charged the jury that, if the defendant knew of the insolvency of James Brown & Co. at the time he indorsed their note, he could not urge the want of due notice to discharge himself from the payment of it.

The jury accordingly found for the plaintiff, and the case now came before the court on a motion by the defendant for a new trial."2

TILGHMAN, C. J. The objection to the verdict in this case is that due notice of nonpayment by the maker of the note on which the ac

2 The arguments of counsel and the concurring opinion of Yeates, J., are omitted.

tion is founded was not given to the defendant, who was the indorser. It is confessed that due notice was not given; but the plaintiff contends that, under the circumstances of the case, notice was not necessary. The circumstance principally relied on at the trial, and on which the plaintiff had the charge of the court in his favor, is that at the time when the note was made and indorsed, and also at the time when it fell due, it was known to the defendant that James Brown & Co. were insolvent. If the case rested solely on this objection, I should be for granting a new trial, because the cases cited by the plaintiff, of De Berdt v. Atkinson, 2 H. Black. 336, and Cornay v. Da Costa, 1 Esp. Rep. 302, have been overruled in Nicholson v. Gouthit, 2 H. Black. 609, and Esdaile v. Sowerby, 11 East, 114. The case of Jackson v. Richards, 2 Caine's T. Rep. 343, agrees with the law as settled by the last English cases. But I do not rest my opinion solely upon the authority of these cases. The reason of the thing demonstrates that the insolvency of the maker of a note, though known to the indorser, ought not to discharge the holder from giving notice. There are various degrees of insolvency, and it rarely happens that a man is totally insolvent. So that there is a chance of getting something by an application to the debtor. Besides, if a man has nothing of his own, he may have friends, who, to relieve him from pressure, will do something for him. The indorser, therefore, has a chance of securing himself at least in part. The only reason that can be assigned for insolvency taking away the necessity of notice is that notice could be of no use to the indorser. But it is almost impossible to prove that it might not have been of use. Therefore it is necessary.5

There is another circumstance in this case, however, operating powerfully in favor of the plaintiff. The house of James Brown & Co. consisted of James Brown and Armat Brown. When the note fell due, James Brown was in Europe, and Armat Brown in this city. A few months before it was due the defendant received from Armat Brown an assignment of his whole estate, for the purpose, among other things, of indemnifying him against his indorsements on account of James Brown & Co. Now, by the taking of this assignment, it is not unreasonable to presume that the defendant took upon himself the payment of the indorsed notes, especially as when he did receive notice (10 days after the note fell due), although he knew and remarked that it was out of time, he did not deny his responsibility, but said that his ability to pay would depend on the arrival of a vessel. I agree, therefore, with Bond v. Farnham, 5 Mass. 170, 4 Am. Dec. 47, where it was held that in such a case the indorser dispenses with notice. Inasmuch, then, as it appears upon the whole of this case that notice of nonpayment was not necessary, no injustice has been done by the verdict, and therefore a new trial ought not to be granted.54

New trial refused.

53 But see West Bank v. Haines, 135 Iowa, 313, 112 N. W. 552 (1907). 54 Compare Kramer v. Sandford, 4 Watts & S. 328, 39 Am. Dec. 92 (1842).

CREAMER v. PERRY and Trustee.

(Supreme Judicial Court of Massachusetts, Middlesex, 1835. 17 Pick. 332, 28 Am. Dec. 297.)

Assumpsit on a promissory note dated January 27, 1834, for the sum of $697.68, made by Isaac Thayer, of Sherburne, payable to the defendant or his order in six months from the date, and indorsed by the defendant.

It was agreed by the parties that in February, 1834, Thayer stopped payment, and assigned all his property for the benefit of his creditors. to one Choate and John M. Perry, who was summoned as trustee in the present action; that in the assignment the defendant, who was the father-in-law of Thayer, was a preferred creditor, and was fully secured for all his demands and liabilities; that shortly after the assignment all the creditors of Thayer, excepting the plaintiff, agreed to give Thayer an extension of the time of payment of their respective claims for four, eight and twelve months, provided all the creditors should assent to it; and that Thayer, although the plaintiff did not agree to such extension, took possession of the property so assigned, proceeded to dispose of it as before the assignment, and continued to transact business in his own name, until after the note became due.

A witness produced by the plaintiff testified that the plaintiff delivered the note in question to him on the day after it became due, with directions to collect the money of Thayer; that on the same day he `called upon Thayer, who proposed to renew the note for the sum of $350, and to pay the residue in cash; that this proposal was declined; that a few days after the note became due the witness was told by Thayer that he had conveyed away all the property in his shop; that the witness then called on the defendant, who lived in Sherburne, and informed him that he called, by the request of the plaintiff, to settle the note, it not having been paid by Thayer; that the defendant said that he knew that the note was unpaid; that Thayer had endeavored to induce the plaintiff to renew the note for the sum of $350, and to receive the residue in cash; that he, the defendant, had indorsed a note for that amount for the purpose, but the plaintiff had refused it, and that Thayer's ability to pay it would depend upon his getting accommodation at the Tremont Bank; that before leaving the defendant the witness inquired of him what would be done about the note, and the defendant said that "the note will be paid"; that the defendant, in the course of the above conversation, also said that he had received no letter informing him of a demand of payment and of nonpayment of the note by Thayer; that the witness inquired of the defendant if he had the benefit of the property assigned by Thayer to Choate and Perry for his indemnity, and the defendant replied, either "I had the ben

efit," or "I am to have the benefit of it"; that he asked the defendant if he knew what Thayer had done with his goods that he had in the store the last week, and the defendant answered that he did not; that the witness did not understand from the defendant that he, the defendant, was a preferred creditor, or that he was to have any benefit under the new assignment by Thayer to his brothers, or that the defendant knew of any second assignment.

The plaintiff was nonsuited.

If, in the opinion of the court, it would be competent for the jury to find a verdict for the plaintiff on the foregoing evidence, the nonsuit was to be taken off, and a new trial granted; otherwise, judgment was to be rendered for the defendant.

SHAW, C. J., delivered the opinion of the court. It was conceded, that no seasonable demand had been made on the promisor, and no notice given to the indorser. The plaintiff relied upon a waiver, as an excuse for want of demand and notice, placing it on two grounds: (1) That the promisor had placed funds in the hands of the defendant to meet the payment; and (2) that, with notice that there had been no demand and notice, the defendant had promised to pay the note.

This is rather matter of evidence than of law; that is, whether there is proper evidence to go to a jury, and whether it would be sufficient to warrant them in finding a waiver of demand and notice.

On the first ground we think that the most which could be made of the evidence is that after this note was made, but several months before it became due, the promisor made an assignment to trustees, upon trust among other things to secure the defendant for all debts due to him from the promisor, and to indemnify him against all his liabilities. Without stopping to consider whether, after this property was surrendered by the trustees, the defendant could have availed himself of it, we think the effect of this assignment was to secure and indemnify the defendant against his legal liabilities; and as his liability as indorser on this note was conditional, and depended upon the contingency of his having seasonable notice of its dishonor, his claim upon the property depended upon the like contingency.55

The second assignment does not affect the question. It does not appear to have been made till several days after the note became due.

And on the other ground, it is a rule of law that if an indorser, knowing that there has been no demand and notice and conversant with all the circumstances, will promise to pay the note, this is to be deemed a waiver.5

55 But compare Bond v. Farnham, 5 Mass. 170, 4 Am. Dec. 47 (1809); Develing v. Ferris, 18 Ohio, 170 (1849).

56 Accord: Ross v. Hurd, 71 N. Y. 14, 27 Am. Rep. 1 (1877); Glidden v. Chamberlain, 167 Mass. 486, 46 N. E. 103, 57 Am. St. Rep. 479 (1897). Compare Aebi v. Bank, 124 Wis. 73, 102 N. W. 329, 68 L. R. A. 964, 109 Am. St. Rep. 925 (1905); First Bank v. Gridley, 112 App. Div. 398, 98 N. Y. Supp. 445 (1906).