CH. 24.
Art. 4.

Carth. 269, Williams v. Williams.A. D. 1692.

Salk. 132,

missory notes, to the first year of queen Anne; and that in one of them it had been expressly adjudged on demurrer in the king's bench, and judgment affirmed upon argument in the exchequer chamber before all the judges of the common pleas and barons of the exchequer."

14. Cases to this purpose. In this case John Pullen made his note, and thereby promised to pay £12 10s. to Jos. Williams, on a day certain; he endorsed it to Daniel Foe, and he endorsed it to the plt., Thomas Williams, a goldsmith in Lombard street, for like value received. The plt. as the last endorsee, sued the last endorser, and declared, "that the city of London is an ancient city," and on a custom in it, time out of mind, among merchants and other persons residing and exercising commerce within the realm of England, used and approved &c. stating a custom that included said note and endorsements &c., then stated the making, and endorsements of it made by said Pullen, a merchant, according to the custom of merchants, and said endorsements according to it. Notice to the drawer and his refusal to pay, whereby the deft. according to the usage and custom of merchants became liable to pay the plt., and in consideration thereof promised to pay it &c., alleging they were all persons who traded by way of merchandise &c. A frivolous plea pleaded, and the plt. demurred and had judgment in the B. R. Deft. brought error in the exchequer chamber. Objection was, that the plt. had not declared on the custom of merchants in London, or any other particular place, but had declared on a custom through all England, and if so, it is the common law, and then it ought not to be stated by way of custom; and if a custom, then stated as of a particular place, whence a venue might arise to try it; answered the custom of merchants as to bills of exchange is a part of the common law of which the judges take notice ex officio, as held in Carter v. Downish. So needless specially to state it as it is enough to say, one according to the usage and custom of merchants drew a bill &c. Hence, all stated relative to the special custom is surplusage, and the declaration good without; so held the judges, and judgment affirmed for the endorsee. There is no doubt but the law merchant is a part of the common law, and the decision in this case by all the judges must have been on the ground, that this note came within the law or custom of merchants. Yet it does not appear that this was made a question, and also the deft. who might have made this question, pleaded a frivolous plea in the B. R. Was this an adversary suit? See Hodges v. Steward; Sarsfield v. Witherly, ante s. 4.

§ 15. Moor, a goldsmith, gave two notes payable to Lewis, Hill & al., the deft.; he Oct. 19, 1693, endorsed them in blank and

Lewis.

6 Mod. 147.-2 Stra. 1175.-1 Wils. 147.

delivered them and eight others to one Zouch to whom he was indebted; he the same day delivered them to the plts., being goldsmiths, and they paying for them. Moor soon after failed, and the main question was if the plts. had seasonably demanded payment of him. And Holt Č. J. held, that goldsmith's bills were governed by the same laws and customs as other bills of exchange, that every endorsement is a new bill; and that every endorser is liable as a new drawer. That by custom every endorser is only liable in default of the first drawer; that every endorsement must have convenient time to demand payment; and that the assignment of a note not payable to order, (as was the case of one of these notes) charges the endorser, not the drawer; as such a note not payable to order is not assignable; but that the words, or to his order give authority to the payee to assign by endorsement, and is the first drawer's agreement to answer it to the assignee. This case weighs but little; for in it we have only Holt's opinion, who nearly at the same time joined in the decisions in Clark v. Martin, and the other cases cited above on the other side of the question. He too in this case, Hill & al. v. Lewis, spoke only of goldsinith's bills. And as to a seasonable demand, and the liability of an endorser to his immediate endorsee on a note, one of them not made payable to order, so not negotiable. And as the plt. declared first as on a bill of exchange; 2. a mutuatus; 3. an indebitatus assumpsit for money laid out for the deft's. use, all Holt said might well have relation to the endorser's liability to his endorsee on one or more of these counts, and it is more reasonable to suppose Holt was thus to be understood, than to suppose he palpably contradicted himself in this and the other cases cited on the same subject much agitated, and all about the same time. Further, what could a note not payable to order or bearer, and so in no manner negotiable, have to do with the custom of merchants, or with the rules of law relating to a money note or bill payable to order? And there was no separation of the

notes.

CH. 24.

Art. 4.

v. Garret.

16. This was an action on a note to pay sixty guineas on 4 Mod. 242, a contingency, so not within the custom of merchants on that 244, Pearson account. And so judgment for the deft., the plt. declaring on A. D. 1693. that custom; but it was said if the note had been given by way of commerce it had been good. See the declaration at large and demurrer to it; and as in Hill v. Lewes the plt. declared as on a bill of exchange. The dictum seems to have been only the saying of counsel. It does not appear 4 Mod- A. D. 1696, ern, that the judges did any thing more than give judgment Lloyd. for the deft., therefore this case is not very material. See Bromwick v. Lloyd, ante s. 4 also cited, to prove notes were negotiable before the statute, but on examination there does

Bromwick .

Art. 4.

Plea was,

CH. 24. not appear any question made or decided material to the present purpose. The declaration stated a special custom in London, and a note made according to it to pay £26 10s. 9d. on demand to the plt. not said to order or bearer. the deft. lived at Brentford and not at London. Plt. demurred, because the deft. traversed matter not traversable, and because it tended to the general issuc &c. Judgment of course for the plt. on the pleadings.

Ld. Raym.

175. A. D.

1697. Pinck ney v. Hall.

3 Salk. 67,

Seldnith. 9 W. III.

17. The deft. gave his note for himself and partner, joint merchants, to Hutchins or his order. He endorsed it to the plt. He declared on the custom of England to which the deft. demurred: 1. Because the declaration being by the custom of England &c. was ill, for the custom of England is the law of England, which the judges notice ex officio: 2. Other objections not material &c. Judgment for the plt. ; this too of course was on the pleadings.

18. If a bill be made payable to A or bearer, the bearer Nicholson v. must sue in A's name &c. (old notion.) "But if made payable to A or order, an assignee may sue in his own name, because the order must be made by endorsement or the like, to shew the drawer's consent;" same case 1 Ld. Raym. 180, where it is said a goldsmith made a note promising to pay one Mason or to bearer £100, and Mason delivered it to the plt. for £100 value received. Held as above. The only point the court had to decide in this case was, as the law then was, that the bearer could not sue in his own name; and it is hardly to be supposed that the court, as a court, gave a formal opinion upon a contract to order not before it.

3 Salk. 67,

68, Jordan v. Barloe.

12 W. III.

3 Salk. 68, Williams v. Field.5 W. III, Hodges v. Steward.

19. In this case Salkeld states, that a bill drawn payable to W. R. or order, is within the custom of merchants, and may be negotiated and assigned by the custom and the contract of the parties; otherwise if to bearer, and cites Hodges v. Steward. A bill is mentioned in this case and not a note.

§ 20. Ruled, that where a bill is drawn payable to W. R. or order, and he endorses it to B, and he to C, and he to D, D may sue any of the endorsers, because every endorsement is a new bill, and implies a warranty by the endorser that the money shall be paid. In this case also the report is as to a bill. And 3 Salk. 68, 69, decided if a plt. declare on a custom for the bearer to bring the action, and the deft. demur and does not traverse the custom, the plt. must have judgment. Here was judgment merely on the pleadings against the rule the bearer could not sue. The plt. it will be observed in some of the prior cases recovered on this principle; where he declared on a special custom in London and the deft. did not traverse it. This was enough to entitle the plt. to judgment, though on proper pleadings he could not have had it.

Cн. 24.

Art. 4.

cases.

21. Many other cases are cited to shew notes were negotiable before the statute, as Cromwell v. Floyd, Newman's case, 12 Mod. 241 decided, a bearer of a bill is not liable to be sued; 5 Mod. 367, Woolvil v. Young & al. turned on a Several defect in the declaration. Hawkins v. Cardy, 1 Salk. 65, was decided on the assignment of only a part of the debt due; and any thing said further was mere dictum and ex gratia. 12 Mod. 244, Lambert v. Oakes, 10 W. III, was only Holt's opinion, and only decided there must be a demand on the drawer before the endorser is liable: I say Holt's opinion, because it will be recollected that a few years after this he was so clear and decided in Clerk v. Martin, Buller v. Crips, &c. against the negotiability of notes before the statute. Therefore, we must be careful how we admit obiter dicta ascribed to Lord Holt inconsistent with his subsequent settled decisions. See Lambert v. Oakes, Ch. 20, a. 15, s. 5; 12 Mod. 380, Carter v. Palmer; 12 W. III. So in this case we have only Holt's opinion, and only decided a promise to one and bearer is not negotiable, and as to what might seem further could not have the weight of authority. A few other cases have been cited to prove this negotiability before the statute not very material.

$22. On the whole, a great number of cases at different times have been cited, mostly noticed above, to prove that a money note payable to order, was in its nature and before the said 3 & 4 of Anne negotiable, so that the assignee of endorsee of it could sue and recover it in his own name, and to his own use, against the maker or any endorser by the plt's. endorsee. But on a close and critical examination of the cases it will be found their weight is far inferior to their number, so that they have generally been decided on the forms of pleadings, and upon collateral points in them; often without argument, and that many of them embrace only Lord Holt's opinions and dicta, clearly overruled if reported correctly in the solemn decisions, in which he afterwards confidently joined, subsequently made in Clerk v. Martin, Buller v. Crips, Potter v. Pearson &c. &c. On a full view of them this inquiry arises, namely: if they, as some urge, clearly proved this negotiability of notes in question, why was so little notice taken of these cases by court and counsel in Clerk v. Martin, and the latter cases well considered, and which settled the law at least for the time, against such negotiability, and which produced the said statute of Anne. Also it is to be observed, that parliament in passing this act expressly recited, that it had been decided that these notes were not so negotiable, and took no notice of different decisions, not so much as to say there were doubts on the subject.

Сн. 24.
Art. 4.

ner.

23. The fair view of this subject seems to be in this manLong before the statute of Anne, there were much in use, and beneficially, among traders and brokers, the verbose notes called bills of debt, above described, at Amsterdam and many other places on the continent. As trade and money operations increased in England, these instruments, and short notes somewhat on the same principles, became useful there, and especially in Lombard street, and more especially among the goldsmiths of that street, the then brokers &c. Such instruments, not proper bills of exchange, being found to be very useful and convenient, the merchants, traders, and brokers, and some judges and lawyers favoured them and countenanced their negotiability; and endeavoured to draw them within the custom of merchants, and to rank them among real bills of exchange. Hence, sometimes they were sued as such, and by bearers and by endorsees; and these sometimes recovered judgments, without argument; sometimes on the deft's. default, or defects in his plea; sometimes because the plt. laid a special custom, and declared on a note brought within it, and the deft. admitted the custom by not traversing it, as in Hodges v. Steward, above. And several forms of declarations in such cases, got inserted in Rastell and other books of entries. Still, as Malynes ststed, these proceedings on these notes, as on real bills of exchange, and as so negotiable, were against the principles of the common law. At last the attention of Lord Holt, and of the other judges of the king's bench, was particularly drawn to these proceedings, and to this subject; and so much so, that Lord Holt was led to say the goldsmiths of Lombard street were attempting to make new law, and to oppose them totis viribus, and their new proceedings; while the judges of the common pleas, and the barons of the exchequer did not for a time, at least, lean against them, but who concurred with the judges of the king's bench; when early in the reign of queen Anne, the subject was much discussed, and it became necessary to decide the cases strictly, according to law; and when too, the strong and clear distinctions came to be made between inland bills, and promissory notes, which were made in the said statutes of W. 3, and of Anne. Distinctions so strong and clear, that it is difficult to conceive how reporters ever confounded such bills and notes, after the said statute of W. 3 was passed.

On a careful review of this subject, we may conclude, though not without some doubts, that no chose in action, proper bills of exchange excepted, is assignable, negotiable, or endorsable, as aforesaid, in any state in the Union, but in virtue of some statute adopted or enacted.