Weldon v. Buck

Van Ness, J. delivered the opinion of the court. The plaintiffs’ right to recover is denied, on the ground that they were bound to present the bill for payment, and to have the same presented for non-payment, notwithstanding it had previously been protested for non-acceptance. There are some dicta to give colour to this objection, but they are neither supported by adjudged cases, nor well founded in principle, A notion once obtained in England, that itt certain cases the holder, by having the bill protested for non-acceptance, could oblige the drawer or indorser to give security for the payment of it when it fell due; (Cunningham on Bills, 42. Marius, 117.) and protests for non-acceptance in France, even now, are nothing more than pro, tests for security. This is probably the origin of the doctrine urged by the counsel for the defendant on this occasion. When the nature of the undertaking of the drawer, and of those who subsequently give currency to a bill, is considered, it will be difficult to discover any good reason why the holder should be compelled to demand payment after acceptance has been refused. The obligation of the drawer and indorser is not only for the payment, but the due acceptance of a bill. The inconvenience and disappointment to the holder generally are the same, whether they arise from the one or the other! Upon the nonacceptance of a bill, the holder is bound, in most cases, to give immediate notice to the drawer, so that he may withdraw his property out of the hands of the drawee. Suppose, then, that the drawer, in consequence of this notice, as it is to be presumed he will do, actually withdraws his funds from the hands of the drawee, before the bill falls due, (and such a case may easily occur,) would it not be absurd to require the holder to present the bill for payment, when there is almost a certainty that payment will be refused ? It is admitted by the counsel for the defendant, that the holder has a right to commence a suit upon the protest for [148] non-acceptance; but it is insisted, that if he omits to present the bill for payment, such omission would be a good defence against a recovery. Suits upon the protest for non-acceptance only, in England, are very common, and such a defence has never, that I know of, been attempted. Suppose a bill, payable at a very long sight, and that a suit should be brought on the protest for non-acceptance against the drawer or indorser, and the money collected before the bill becomes payable, it will not be pretended that the money could be recovered back, if the holder had neglected to present the bill for payment. It was said, that the bill may be paid, notwithstanding acceptance may be refused, and that by permitting the holder, to recover against the drawer, before the bill has' been presented for payment, he may obtain the money from both drawer and drawee. Admitting this to be so, it does not prove the right of action against the drawer to be merely inchoate. But the answer to this argument is, that-the drawer might avail himself of the payment made by the drawee in his defence. This question, however, was put at rest by a recent decision of this court, after full consideration, in the case of Mason & Smedes v. Franklin. (3 Johns. Rep. 204.) In that case, as in this, it was contended, that the right of action on the protest for non-acceptance, was merely inchoate, and became perfect only after protest for non-payment.. The court held, “ that a good cause of action arose upon “ the protest for- non-acceptance, and even if it were admitted that the subsequent demand of payment and-protest for non-payment, were void acts, they would not destroy “ the right to recover which had previously vested." This decision is fully supported by authority, and will hereafter be regarded, I trust, as the settled law. The qualification of this right, now set up, I do not find to have ever been before suggested. In Bright v. Purrier, (Bul. N. Prius, 269.) the defendant offered to prove, that by the custom of merchants he was not liable at all, till the bill fell due ; but Lord Mansfeld overruled the evidence. In Chilton v. [149] Whiffen & Cromwell, (3 Wil. 17.) Chief-Justice Wilmot gives a corrected report of the case of Macarthy v. Barrow, in 2 Str. 949. In that case, the court said, “ that the “ non-acceptance or protest did not raise any debt. That “ the drawer, instantly upon his drawing the bill, contracts “ a debt, and that a protest is nothing but a notice that the “ drawer will not pay it; that it is debitum in presenti, solvendum in futuro. And the obligation to pay arises as “ well upon the protest for non-acceptance, as for non-payment.” To the same effect is the case of Milford v. Mayor, (Doug. 54.) and the more recent case of Ballingalls and another v. Gloster. (3 East, 481.) The plaintiffs’ right to recover being, as I think, perfectly clear, the next question is, whether they are entitled to recover the 20 per cent, damages. This point has already, in a great measure, been disposed of; for if the plaintiffs’ right of action was complete and perfect, when they commenced this suit, this bill having been remitted in the usual course of business, it appears to me to follow as -a necessary consequence, that they are entitled to recover the damages. The law allowing damages to the holder of a dishonoured bill, was dictated by reasons of commercial policy, which apply with equal force to the case of a bill protested for non-acceptance as to that of a protest for nonpayment. The amount of the damages, in other countries, depends upon the rate of exchange. This was so uncertain and fluctuating, that in this state, by the custom of merchants, another rule was introduced, the object of which was to reduce the amount of damages upon returned bills, to a sum certain. It was said, that the right to demand damages arises only upon the protest for non-payment, and that there is no case in which they have been allowed, when the suit was founded upon the protest for non-acceptance only. I have not met with any express adjudication upon this point, but if any distinction of this kind existed, is hardly possible that it would not have been recognised in some of the cases which have been [150] mentioned. I, however, find no such distinction, nor can I conceive of any good reason to be assigned for its adoption. (2 Hen. Bl. Rep. 378. Mellish and another v Simeon.) The opinion of the court, therefore, is, that the plaintiff is entitled to recover the amount of the bill, the 20 per cent.damages, with the usual interest, and also the expenses of the protest for non-acceptance, and judgment must be entered accordingly. Judgment for the plaintiff.