Howze v. Perkins

ORMOND, J. It is well settled, that every endorsement is a new and substantive contract, governed by the law of the place where it is made. [Hanrick v. Andrews, 9 Porter, first case; Givens & Herndon v. The Western Bank of Georgia, 2 Ala. Rep. 397.] To charge an endorser of an instrument, like the one described in the declaration, the statute of this State requires that the maker should be sued to the first court to which suit can be brought. [289] [Aik. Dig. 829.] In the exposition of this statute, it was held in Woodcock v. Campbell, 2 Porter, 456, that where the maker removed beyond the limits of this State, after the endorsement, that it was not necessary to sue him in the State to which he removed. In Ivey v. Sanderson, [6 Porter, 420,] where (he assignee took the paper at the time of the assignment, with a knowledge that the maker lived beyond the limits of the State, it was held that he could not recover of the assignor, without showing that he had employed proper diligence to recover the money from the maker, or that he was insolvent. To the same effect, is the case Bristow & Roper v. Jones, [1 Ala. Rep. 159.] In this case, it does not appear from the record, where the makers reside, or if non-residents, whether they were so at the time the endorsement was made. Be the fact, however, of the residence of the makers of the note, as it may, when it was shown by proof, that the endorsement was made in this State, there could be no recovery on the declaration filed in the cause, as it neither averred a performance of those acts which are .necessary to charge an endorser of an instrument of this character, or any excuse for failing to comply with the requirements of the statute. The fact that the note was payable at a place beyond the limits of the State, does not vary the liability of the endorser, or supersede-thc necessity for the exercise of that diligence which the statute requires, to charge the endorser, if ihe maker resides within , the State, and if resident beyond the State, the fact should have been specially averred as an excuse for the omission of the diligence exacted by the statute. Nor is the case varied by the fact, that by the contract of the makers, the note is payable in the city of New York, and is there regarded as mercantile paper. The contract of the endorser is not to pay in the city of New York, but is a conditional undertaking to pay in Alabama, if the maker does not discharge the note, proper diligence having been employed to obtain the money from the maker. What shall constitute that diligence is regulated by statute, which declares that bills of exchange and promissory notes, payable in bank, shall be governed by the rules of the law merchant — that all other contracts for the payment of money, &c., shall be assignable as heretofore; that notice of non-payment shall be required only on bills of exchange, and notes payable in [290] bank, and that the endorser of paper, not mercantile under the act, shall be liable only where the maker is sued to the first court to which suit can be brought, and prosecuted to a return of “no property found.” [Aik. Dig. 330.] The Legislature, by this act, has defined the liability of endorsers, and declared what class of instruments shall be considered as mercantile, and it would defeat the very object it had in view in the passage of the act, if the contract of the endorser was to depend on the character affixed to the endorsed instrument by the law of another State. The court, therefore, erred in its charge to the jury, that the defendant was responsible on his endorsement on demand being made and! notice given of the refusal of the makers to pay. These views render it unnecessary to consider the propriety of the judgment of the court, on the demurrer to the declaration. If, as contended by the counsel for defendant in error, its true meaning is that the endorsement was made out of this State, and iu the State of New York, it was contradicted by the proof, and the defendants below were entitled to a verdict; if, on the other hand, it showed that the endorsement was made in this State, it was bad! because it did not aver the proper diligence as required by the statute, or show any excuse for not doing so. Let the judgment be reversed, and the causo remanded»