Low v. Howard

Dewey, J. The engagement of the indorser oí a promissory note, is only a conditional liability to pay the same if due demand is made on the maker, and due notice given to the indorser. In the present case, it is conceded by the plaintiff, that no demand was made and no notice was given to the [270] indorser. The defendant was, therefore, legally discharged of all liability as indorser, and might have resisted all attempts to enforce any such claim against him. If such liability now attaches, it is by reason of his subsequently assuming the same by a new promise to pay the note. This the defendant might do, if he voluntarily, with a knowledge of all the facts, assumed such liability. The further inquiry is, whether the case finds such knowledge of all the facts essential to be known to him, to give effect to such new promise. The case put to the jury was that of knowledge on the part of the defendant, that the note had not been paid, and no notice of its nonpayment had been given to him, and that the effect of such want of notice was to discharge him as indorser, and if these facts were shown, it was held sufficient to charge the defendant. On the other hand, the defendant contended that he was not liable on his new promise, unless he knew, at the time of making the promise, that no demand had been made on the maker. It seems to us that the knowledge of this latter fact was material. Knowledge of the want of due notice to him that tire note had not been paid, is only knowledge of a part of the facts. This might well be so, and yet the proper demand on the maker have been made. The omission to give notice to the indorser was one species of loches, and the neglect to make a proper demand on the maker another and different one. It has been held by this court that a waiver of the right to notice, by the indorser of a promissory note, does not excuse the indorsee from demanding payment of the maker at the maturity of the note. Berkshire Bank v. Jones, 6 Mass. 524. See to the same effect, Drinkwater v. Tebbetts, 5 Shepley, 16; Lane v. Seward, 2 Appleton, 98; 1 Parsons on Contracts, 232. The grounds of the rule are stated thus by Professor Parsons: “ Though the party may not wish for notice of the nonpayment, he may still claim that payment should be demanded.” It might well happen that upon proper presentment and demand of payment of the maker, the same might have been paid, when, in the absence of such demand, payment might have been neglected. [271] That full knowledge of all the facts which should be requisite to revive a legal liability once discharged, ought to include the fact that there had been no demand on the maker, as well as no notice to the indorser. The case having been put to the jury under instructions of a different character, the verdict must be set aside, and a New trial granted.