Schlesinger v. Schultz

Laughlin, J.: The action is against the maker and indorser of a promissory note dated the 23d day of June, 1903, payable to the order of the maker — the defendant Carraway—“on demand after date,” at the “Equitable National Bank of New York, with interest.” The note was indorsed by the defendant Schultz and discounted for the maker by the Federal Bank on the 3d day of July, 1903. The indorser only was served and appeared in the action. He defended and his counsel seeks to sustain the judgment upon the grounds, jk'st, that it was nót shown that the note was presented for payment during banking hours ; second, that presentation at the bank where the note was payable was insufficient, for the reason that the bank at that time was in' the hands of a receiver and presentation should have been made to the receiver personally, and, third, that even if presentation was made to the proper party and at the proper place it was not sufficient in point of time. The note was presented for payment ,at the Equitable National Bank on the 22d day of April, 1904. That bank had suspended its business in the month of February the same -year, and was in the hands of a receiver appointed by the Comptroller of the Currency who was closing up the affairs of the bank pursuant to the National Banking Act. His powers and duties were prescribed by section 5234 of the Be vised Statutes of the United States. He was-not authorized to continue the banking business. The note, certificate of protest and affidavit of service thereof were read in evidence. The certificate of protest shows that the notary presented the note for payment at the Equitable National Bank for payment on the 22d day of April, 1904, “and found the bank closed.” The respondent contends that the certificate should, have shown that presentation was made during banking hours and that the inference [358] is that it wás presented after .banking hours for the reason that the receiver was in possession of the bank during ordinary business hours and that, Therefore, the bank was., not closed daring such hours. - The evidence shows that the bank had suspended bankings business and for all practical purposes, at least as to business of this nature, it had closed. The .certificate of the notary “ is presumptive evidence of'the facts certified.” (Code Civ. ■ Proc.. § 933:) ' There is a legal presumption that-the notary made the presentation at the proper .time, of day 'and .we think the fair construction of this certificate is that -presentation was made during regular banking hours artd that the bank had ceased to transact business of this nature and was for all practical purposes closed. (Cayuga County Bank v. Bunt, 2 Hill, 635 ; De Wolf v. Murray, 2 Sandf. 166 ; Tied. Bills & Notes, § 128 ; 1 Pars. Notes & Bills, 421 ; Smith v. Poillon, 87 N. Y. 590.) If the bank had continued its business) the presentation should have been made during banking hours, or, if the maker had no money there to- meet the note at any timé during the day, it .should have .been made before -the bank closed (Neg. Inst. Law [Laws of 1897, chap. 612],' §. 135), but since the bank had discontinued the banking business it was only necessary that the presentation should be made “ at a reasonable hour on' a business day.” (Neg. Inst. Law, §.§ 132,, 133, as. amd. by Laws of 1898, chap. 336.) Notwithstanding the fact that the bank was closed, presentation at the bank was .proper, if, indeed, any presentation was necessary under those circumstances. (Edwards Bills & Notes [3d ed.], 498 ; Story Prom. Notes [7th ed.], § 234; 1 Pars. Notes & Bills, 438; Daniel Neg. Inst. [5th ed.) §§1118,1119; Wiseman v. Chiappella, 23 How. [U. S,] 368.) Section 133 tif the Negotiable Instruments Law (as'amd. by Laws of 1898, chap. 336) provides thatpresent- . ment for payment is" made at the proper place, *' * *-. where a place .of payment is specified in the instrument and it is there presented.” ■( We are also of opinion that it was not essential that a demand be made upon the receiver personally. As has been.seen, the only presentation required by the Negotiable Instruments Law where a place of payment is specified in the instrument is presentation at .that place. (Neg, Inst. Law, § 133, as amd. ’ supra.) The presumption arises on the certificate of the notary either that, he could [359] not obtain admittance to the bank or else that he was informed by those in charge that there was no one found ready to pay the note. The receiver, by virtue of his office, had no power or authority to receive or hold money for the purpose of meeting obligations maturing at the bank, and as to the funds that came into his possession as receiver he had no authority to appropriate any of them to the payment of the note. Consequently it was not necessary to present the note to the receiver personally. Finally, the respondent contends that this note was not payable on demand within the provisions of section 26 of the Negotiable Instruments Law, but at a determinable future time within the pro- ' visions of section 23 thereof, and that, therefore, it- should have been presented for payment the day after it bore date. Section 131 of the Negotiable Instruments Law provides as follows : v Where the instrument is not payable on demand, presentment must be made on the day it falls due. Where it is payable on demand, presentment must be made within a reasonable time after its issue, except that in the case of a bill of exchange, presentment for payment will be sufficient if made within a reasonable time after the last negotiation thereof.” We deem it quite clear that this note did not fall due on a particular day and that it was within the intent and scope of the statute a demand note. The question then is: Was it presented within a reasonable time ? The note was payable with interest. It was evidently indorsed for the accommodation of the maker. It does not appear on what day the indorsement was made, but it does appear that it was not negotiated until ten days after date. There is nothing in the transaction to indicate that the parties intended that it should be presented for payment either immediately or within a very short, time, as was found to ibe the intention of the .parties in Crim v. Starkweather (88 N. Y. 343), where the note was payable “ on demand after date,” with interest, “ after maturity,” and was indorsed and transferred by the payee on the day of its date and was not presented for payment for nearly four years thereafter. The case of Hardon v. Dixon (77 App. Div. 241), relied on by the respondent, has no application. The point there decided was that the Statute of Limitations did not commence to run on the day of the date of anote payable “on demand after date.” [360] We think a reasonable period of credit was" intended,, and that presentation within ten months was timely to hold the indorser. It follows, therefore, that the judgment should be reversed and a new trial granted, with costs to appellant to abide the event. O’Brien, P. J., Patterson,. Ingraham and McLaughlin, JJ., concurred. . Judgment reversed, new trial ordered, costs to appellant to abide event. .