Gindrat v. Mechanics' Bank of Augusta

GOLDTHWAITE, J. — This case seems to have been contested by both parties, before the jury, under the impression that the notice of non-payment sent to the defendants, through the post office at Montgomery, by the notary, was insufficient, by the rules of the general law merchant, to charge them, and consequently, the attempt to support the suit by proving the custom and usage of the Bank at Montgomery, to give notice in this manner. In our judgment the notice sent in this manner was sufficient to charge them, independent of. any special usage or custom, when the facts were disclosed that the Bank at Montgomery only held the bill for the purpose of collection, and that it was owned by a corporation located in another place. The law is now well settled that an agent holding a bill for collection, is not required to give notice directly to the parties to it, but his duty is immediately to notify his principal, he being a party to the bill, and the latter is entitled to charge the parties he looks to for payment, by sending them notice by the first mail after receiving information of the dishonor of the bill. [Colt v. Noble, 5 Mass. 167; Haynes v. Berks, 3 B. & P. 599 ; Turner v. Lague, 2 Johns. Cases, 1; Foster v. McDonald, 3 Ala. Rep. 34.] It is evident that a notice transmitted to the plaintiffs at Augusta, and by them returned to the defendants at Montgomery, would take more time for its conveyance, and involve more risk of miscarriage, than one deposited in the post office at Montgomery, addressed to the defendants there ; [332] but the law merchant is not so unyielding in its nature as to require the performance of a useless act. or to refuse to adopt the act of the agent, if that is equally beneficial, and effectual, as action by the principal. It is true, that it has been laid down that the strict rule of the law merchant, when the parties reside in the same place, requires that the notice shall be personal, ox left at the residence of the party sought to be charged, (Williams v. Bank of U. S., 2 Peters, 96; Ireland v. Kip. 10 John. 420;) and this was recognized in our own Court, in Stephenson v. Primrose, 8 Porter, 34; but the reason of it is, if indeed there is any one which is satisfactory, that the permission to send the notice by mail, is itself rather the exception than the rule, as personal notice must long have preceded the general establishment of the post. The charging a party, therefore, by notice sent by mail, was adopted to suit the general convenience of holders, who did not reside in the same place with the parties sought to be charged. We apprehend it entirely competent,for a holder of a bill payable in Montgomery, and himself residing elsewhere, to direct an agent to whom it is transmitted for collection, to give notice of the dishonor to any of the parties by mail, and that it is immaterial where they reside, so the notice has the proper direction. We should have deemed it unnecessary to have said so much on this point of the case, if it had not apparently been twice before the Court in another case, though at neither time was it decided. In Foster v. McDonald, as reported in 3 Ala. Rep. 34, when a similar notice was given, and when the prima fa-cie intendment was, that the parties resided in the same place, we conformed to the previous decision of Stephenson v. Primrose, but said if it should afterwards appear that from the residence of the holder at a distance from the place of payment, the notice of the dishonor of the bill could not have reached the defendant as soon as the informal notice actually given by the notary, it might be a question whether that was not sufficient. When the same case was again before the Court, in 5 Ala. Rep. 376, it appeared in the shape of a demurrer to evidence, and we held that the fair presumption was, that the notice was actually received by the defendant. It would have been equally proper perhaps, to have placed the decision upon the broader ground, that, whether received or not, the notice was in itself [333] sufficient. The head note prefixed to the report assumes more than was decided by the Court, and calls now for this correction, as otherwise it may have some tendency to mislead. 2. Although this point in the case is free from doubt, and would probably be decisive of the suit if sent back for another trial, yet the legal effect of the charge numbered five in the bill of exceptions, would remain for consideration. It is this, which has caused us to keep the case so long under advisement. At first,it seems a startling proposition, that a Bank has the capacity, by usage or custom, to establish a rule in opposition to the general law merchant; and we oertainly are not prepared to yield our assent to the proposition thus broadly stated; but we must consider the refusal in its connection with the facts of the case, as before the jury. It possibly may, although the inference is otherwise, have been questioned whether the Bank at Montgomery was not the holder of the bill, as well at the time of suit brought, as at the time of its dishonor, and in that view ' the rule declared in Stephenson v. Primrose, that the parties residing in the same place, the notice should have been personal, or left at the defendant’s place of business, would govern the case. To obviate the effect of this rule, proof was given of a usage of the Bank to give notice through the post office, and the question now is, whether it is competent for a Bank to establish such a rule, so as to bind the parties to a bill payable at the particular Bank ? It must be borne in mind, that the question is not whether the Bank could dispense with notice altogether, but is merely as to the mode by which it shall be given. Notice to the indorsers, and drawer, is unquestionably a pre-requisite, in general, to charge them, and it is highly probable that no rule dispensing with it would affect a party, unless expressly assented to. But the mode of notice, is a matter which is in its nature subject to modification and change. Although the post is now generally recognized as a legal mode, there must have been a period in the history of commercial paper when that was unknown. So, too, the introduction of steam navigation between the old world and this, may have the tendency to introduce changes in the transmission of notices with respect to foreign bills: the same results may flow from the electro-magnetic telegraph. Is then the mode of giving notice, a fixed and unchangeable rule, incapable of modification, [334] without the consent of parties ? We think this question must be answered in the negative, and other Courts have come to the same and similar conclusions, after the fullest consideration. In Renner v. The Bank of Columbia, 9 Wheat. 581, the question is very fully examined by the Supreme Court of the United States, and the decision was, that a Bank, by usage, could fix the fourth, instead of the third day of grace, as the period for demanding payment, preparatory to fixing the liability of an indorser. The Court assumed that days of grace were entirely the creation of custom and usage, and if the custom of a particular Bank was known to the party,it entered into and became a part of his contract. In the casé of Mills v. Bank of the U. S. 11 Wheat. 431, the same Court carried the doctrine yet further, and held a party governed by the usage, although knowledge of it was not brought home to him, by reason of the bill appearing on its face to be made negotiable and payable at the particular Bank. That is this case, and instead of reasoning it out, from principles recognized and admitted almost universal- ' ly, we shall content ourselves with a reference to these cases. We cannot perceive a distinction between a custom to vary the mode of giving notice, and one which varies the time for making a demand of payment. A great number of cases involving the same general principle, are collected in Cow|n & Hill’s notes, page 1412. We therefore conclude, that it was competent for the Bank at Montgomery, to establish a rule, that notice might be given to parties through the post office, although resident in the same place, and that such rule0 was obligatory upon the parties to all bills expressing upon their face to be payable at that Bank. 3. The prayer for the charge numbered six, in substance, asserts, that evidence of usage cannot be given in evidence under the common form of declaring, and that the count should contain an averment of the usage which distinguishes the case from the general law. The fact alledged is, that the defendants had notice, and that was as well established by showing that it was placed in the post office, as it would be by proof that it was left at their place of business. In either case, the conclusion is arrived at, by proof of a fact which leads to ihat result. The case of Jackson v. Henderson, 3 Leigh, 197, does not involve the same question as presented, by this prayer. A distinction , [335] may well exist, between evidence of presentment at a day different from that provided by the general law,and the evidence of notice. In the one case a different fact is proved, but in the other, the fact alledged is proved, but by different evidence. We think, therefore, there was no necessity to aver tne special custom. This consideration of the case is sufficient for the decision of all the questions insisted upon here, and the result is an affirmance of the j udgment.