Keith v. Mackey

Martin, J. The defendant is appellant from a judgment against him, as drawer of a bill of exchange, not presented, nor protested in due time. The record shows, that the parties met in New York, some time between the last day of grace and the day on which the bill was finally protested, when the defendant promised to the plainlifF, that if he would forbear to present the bill, he would pay it shortly ; notwithstanding which, the bill was afterwards presented, protested, and the present suit brought. It is very clear, that the plaintiff, by protesting the bill, absolved the defendant from all obligation under the conditional promise he made. But the plaintiff’s counsel contends, that the obligation of the defendant results from his withdrawing from the hands of the drawees, the funds on which he had drawn. On the expiration of the last day of grace, the funds in the hands of the drawee were at the risk of the plaintiff. The acceptor of a bill, payable elsewhere than at his domicil, is discharged by the delay of the holder in presenting the bill at the place indicated for payment, if he prove that the delay has been injurious to him, by the failure of the banker who was named in the acceptance; as, in such case, the delay put the funds at the risk of the holder. Chitty on Bills, 424, 533, 534, 535. “ If the drawer withdraw his funds from the hands of the drawee, for the purpose of preventing payment by the drawee, neither presentment nor notice is necessary, in order to charge him.” Bailey on Bills, 294, note 137. Ib. 304, and note. See lb. 496, and note 26. In the edition from which this quotation is taken, the editor adds, in a note, that the consequence is the same, if the funds be withdrawn after the expiration of the days of grace. Pardessus, in his Traite du Contrat de Change, vol. 1, p. 407, says, that the consequences of the bankruptcy or insolvency of the drawee, are at the risk of the negligent holder. In Chitty on Bills, 481, it is said : “ where a bill has been refused acceptance or payment, and the drawer has either stopped or withdrawn the effects from the hands of the drawee, though he may be, prima facie, discharged by the neglect to give him due notice, it seems, that in France 279 and America, the holder might recover from him the amount of such funds, but there is no decision to this effect in this country,” (England.) The author speaks of two cases; one in which the funds have been slopped ; the other, that in which they have been withdrawn. The funds have been stopped, when by the act of the drawei, they have been prevented from being paid to ihe holder, at the maturity of the bill; they are withdrawn!, when afterwards, as in the case before the court, they are taken by the drawer. If Chitty spoke only of the case of funds taken away before maturity, he would not have said, “ it seems” He would have spoken positively ; for the authorities, on this point, are numerous in France and America, and there are none to the contrary. Neither could he have said, that there was no decision to this effect in England. The reason that the drawer is discharged from his obligation to pay the bill, by the neglect of the holder to have it presented and protested, and to give notice, is, that he is always presumed to have sustained damage by the holder’s laches. Chitty on Bills, 6th ed. 245. Proof that he has retaken his funds, is proof that he has sustained no loss. The presumption ceases on the administration of contrary proof. Stabit presumptio donee contrarium probetur. If the funds, after maturity, are in the hands of the drawee, at the risk of the negligent holder, and he must bear the consequences of the bankruptcy or insolvency of the former, he must be the owner of such funds, for res perit domino. If this be the case, whoever takes them, without his authority, from the drawee, does him an injury, and we have a textual provision, that “ every act whatever of man that causes damage to another, obliges him by whose fault it happened, to repair it.” Civil Code, art. 2294. On the maturiiy of the bill the drawer may be discharged, by the neglect of the holder, of any obligation then existing, to pay it; but it cannot be thence concluded, that by his posterior torts he may not incur the.obligation so to do. This obligation certainly results from his repossessing himself of the funds. It is just to say, that then the discharge, which resulted from the negligence of the holder, has ceased. It was grounded on the damage which he sustained, or was presumed to sustain, by the negligence of the holder. If the damage does not exist, there ought to be no 280 discharge cessante causa, cessat effectus. When the funds, destined to the payment of the bill, come, no matter how, into the hands of the drawer, he has sustained no loss, and no damages can be due him. Otherwise he would enrich himself at the expense of the holder. Neminem oportet alterius damno locupletari. It has been held by the Court of Cassation in France, that the drawer of a bill of exchange cannot oppose to the holder, his negligence to present and protest the bill, or to give notice in due time, when, since the protest, the drawee having failed, he has successfully claimed from the syndic part of the goods which he had sent* to provide for the payment of the bill. Sirey, 3, 1, 268. In citing this decision, candor requires it to be stated, that there has long been in France a textual provision, in the ordinance of 1673, which has been copied into the Code of Commerce, (art. 171,) on which, probably, it is grounded. There is no textual provision, as far as we know, in England or America, that the drawer is discharged from the obligations on the bill, by the neglect of the holder. The decisions of courts which recognize this principle, cannot be extended to cases not similar to those in which they have been made. The neglect of the holder may discharge the drawer from his then existing obligations ; but it confers on him no right, nor any immunity from the consequences of his posterior act.