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action was brought on it in the name of the payee for their use, against the maker, without any proof of the payee having, after that endorsement, had actual possession of the note, except that it was filed in the cause, it was considered in Maryland that it did not sufficiently appear that the nominal plaintiff was the holder of the note; and the action was therefore defeated. Bowie v. Duvall, 1 Gill & J. 179.

It is, however, enough that the plaintiff is the holder of the bill-having the legal interest. It is no valid objection that the beneficial interest is in another. Mechanics Bank v. Hazard, 13 Johns. 333. Even in Maryland the courts will not enquire whether the plaintiff sues for himself, or as trustee for another, nor into his right of possession unless on an allegation of mala fides. Burckmyer &c. v. Whiteford, 6 Gill 16.

A house at Paris pressing for a remittance from one in America indebted to it, the American instructed a London house, in discharge of so much of its debt to the American, to remit to the Paris house, and accordingly a bill was bought and remitted to the Paris house. When the bill became due, the drawer having, on the ground of its not having been paid for, directed payment to be refused, the bill was protested. In an action by the Paris house against the drawers (who were the sellers) of the bill, it appeared that the American house, feeling bound in honour to indemnify the Paris house, had paid them the amount of the bill, and thereby become beneficially entitled to it; and the defendants insisted that the London house, in buying the bill, were agents of the American house, and that the latter was responsible for the. price. But this defence did not avail. For the London house were not agents in the sense necessary to make such a plea good. And, moreover, when the bill was dishonoured the Paris house were holders for value, and had then a legal right to sue the drawers. That right, the court of queen's bench was of opinion, they still retained, notwithstanding they had since been reimbursed by the American house: though the beneficial interest was in the American house, the legal interest was not transferred to it, but remained in the London house as trustees for the American house. Poirier &c. v. Morris &c. 2 El. & Black. 89, 75 Eng. Com. Law Rep. 89.

6. General rule as to nature of endorser's liability.

The promise of the endorser of a bill is that he will pay to the endorsee and those claiming under him if the acceptor does not pay to a person entitled to call on him for payment

of the bill when due. Pollock, C. B. in Walker &c. v. Macdonald, 2 W. H. & G. 532.

In like manner the endorsement of a note makes a new contract in case the maker of the note does not pay it. Lambert v. Oakes, 1 Ld. Raym. 443. He is liable conditionally for the payment, in case of a dishonour of the note at its maturity by the maker, and notice thereof to the endorser. Shaw, C. J., 3 Metcalf 506.

7. Endorser of a bill in the nature of a new drawer; but endorser of a note not in the nature of a new maker.

It has frequently been said that every endorser of a bill is in the nature of a new drawer. 1 Str. 442. It is, says Parke, B., part of the inherent property of the original instrument that an endorsement operates as against the endorser in the nature of a new drawing of the bill by him. 1 C. M. & R. 441. And it will not avail the defendant, that when he endorsed the bill he had no property in it. That is not necessary to render him liable to be sued upon it. His endorsement may have no operation with regard to prior parties; but as against him it is equivalent to the drawing of a new bill and operates to transfer that new bill. Penny v. Innes, 1 C. M. & R. 439.

The defendant's endorsement may be after a special endorsement by a payee making the bill payable to a firm, and yet, if the bill become the property of that firm, after the defendant's endorsement, they may sue him on his endorsement; the fact being that he never was the endorsee of the firm, nor was it ever intended to convey the property in the bill to him. S. C.


If the fact had been that the defendant was the endorsee of the firm, and again delivered the bill to them, then to avoid circuity of action the firm would not be allowed to recover against him. Certainly an action by the holder, against an endorser of a note, will be defeated by shewing that the plaintiff is one of a firm who endorsed before the defendant. the action could not be maintained against a subsequent endorser by a firm which stood as prior endorsers, so neither can it be maintained by one of the firm. Decreet v. Burt, 7 Cush. 551. And in this respect it is not perceived that there is any difference between a bill and a note.

There is a difference in some others. The maker of a negotiable note is viewed rather as an acceptor than a drawer. If the drawee accept a bill, and another person not a drawee accept it also, the latter cannot be sued as acceptor. Jackson

v. Hudson, 2 Camp. 447; ante, p. 150, 51. And when a negotiable note made by one person is endorsed by another, without a previous endorsement by the payee, the endorser cannot be sued as maker. He must be sued on his collateral Gwinnell v. Herbert, 5 Adol. & El. 436, 31 Eng. Com. Law Rep. 373.


In New York, if a note not payable to the defendant be endorsed by him, and afterwards endorsed by the payee, it will be intended that the defendant meant only to become the second endorser with all the rights incident to that situation. Herrick v. Carman, 12 Johns. 159.

8. Nature of liability on an accommodation note or bill.

An accommodation bill is an instrument which it is intended the party for whose benefit it is accepted, should be enabled to carry into the market for the purpose of raising money. If another person, without consideration, add his name to the bill to give it additional credit, the acceptor is liable to such other person as to any person by whom money may be advanced upon it. In this respect there is no difference as to the liability of the acceptor whether the money be obtained on the joint credit of the drawer and acceptor or on that of the drawer, acceptor and endorser. Hammon v. Sedgwick, 6 Hare 260, 31 Eng. Ch. Rep. 260.

It is, says Lord Eldon, no answer to an action on a bill that the defendant, the acceptor, accepted it for the accommodation of the drawer, and that that fact was known to the holder; in such case the holder, if he gave a bona fide consideration for it, is entitled to recover the amount, though he had full knowledge of the transaction. Smith v. Knox, 3 Esp. 47.

The acceptor is certainly responsible to an endorser who, on his failure and that of the drawer to pay, is compelled to take up the bill unless there be something in the transaction to change the order of responsibility-something besides its being mere accommodation paper. The different parties who sign as sureties are presumed to know the order of their responsibility, and to look to all prior parties, in the order in which they stand, for their indemnity upon the failure of the real principal. Eldridge v. Duncan, 1 B. Monroe 102.

One who endorses a note for the accommodation of another can maintain no action on it before he pays; but when he performs his duty by taking it up, the note which he has thus paid is a valid note to him, founded on good consideration. On such payment the law raises a promise to him; and his right of action is complete against the prior parties. Wood

v. Repold, 3 Har. & J. 131; Brown v. Mott, 7 Johns. 360; Havens v. Huntington, 1 Cow. 394.

The principle is the same when the note is taken up and sued on by the second endorser. It is no defence to the first endorser that he endorsed the note for the mere accommodation of the maker, and that this fact was known to the plaintiff when he subsequently endorsed the note. Money having been raised on the note with the endorsement of both parties, and the subsequent holder having returned the note to the plaintiff, who took it up for its full value, the plaintiff then has as good a right to resort to the prior endorser as if he had originally received it for its value. Brown v. Mott, 7 Johns. 362.

In short, as it regards the rights and liabilities of the endorsers in relation to one another, there is no difference between a negotiable instrument made for the accommodation of one of the parties and one put into circulation in the usual course of business. Wood v. Repold, 3 Har. & J. 125; 7 Id. 101; Keeler v. Bartine, 12 Wend. 116; Youngs v. Ball, 9 Watts 141; Mullen v. French, Id. 97; Stoddard &c. v. Kimball, 6 Cush. 470. The legal effect of the contract in the former as in the latter case, is that every endorser is conditionally liable to pay in case of the failure of the maker or acceptor, that is upon the condition that the bill or note be presented to the acceptor or maker when due, and if not paid that such endorser be seasonably notified of its non-payment; and any endorser who is called upon to pay may look to his immediate endorser, or to either of the prior parties, for an indemnity for the whole amount thus paid. Church &c. v. Barlow, 9 Pick. 547.

If a bill or note be made payable to two or more jointly, and be jointly endorsed by them, each will be bound to contribute his just proportion. But if the bill or note be made payable to one of them, and be endorsed by the others in succession, the legal effect of the instrument, whether made for accommodation or in the way of business, is to bind them in respect to each other in succession, in the order in which they endorsed; and they must be taken to have intended to be so bound until the contrary appears.

The author is aware that one case has been decided on a different principle; a case in Ohio. Douglass v. Waddle, 1 Hammond 413. But he considers, nevertheless, that the rule as above laid down is now well established generally. It is certainly established in Maryland, Wood v. Repold, 3 Har. & J. 131; Virginia, Farmers Bank v. Van Meter, 4 Rand. 563; Bank of U. S. v. Beirne, 1 Grat. 265; Hogue v. Davis &c.

8 Grat. 4; North Carolina, Hubbard &c. v. Williamson &c. 5 Iredell 397; and in the supreme tourt of the United States, Donald v. McGruder, 3 Peters 477.

The face of the paper determines, prima facie at least, the legal position of the parties. A prior cannot recover against a subsequent endorser unless under very special circumstances. Bishop v. Hayward, 4 T. R. 470; Herrick v. Carman, 12 Johns. 159. If it be alleged that the person appearing to be second was in point of contract first endorser, the allegation must be clearly proved. Chalmers v. McMurdo &c. 5 Munf. 252. Uuder peculiar circumstances the position of the parties, as it appears on the face of the paper, may perhaps be changed by matter dehors. Allison v. Purdy, 6 Barr 502.

9. How far endorser transfers his right or makes himself liable by delivery or endorsement made after instrument becomes due. Whether there must be demand on maker and notice of dishonour.

Before a bill becomes due, it is endorsed in blank to B & Co. for a valuable consideration. After it becomes due, they, by delivery to the plaintiff, and without their endorsement being upon it, transfer their title, which is a perfectly good one, to the plaintiff. In such case the plaintiff is, in law, in the same condition as the holder of the bill at the time when it was endorsed to B & Co. If the name of B & Co. had been endorsed on, and then struck off, the back of the bill, the effect would be merely to exonerate them from liability on the instrument it would not operate as an extinguishment of the title which they had to the bill, and which they transferred to the plaintiff by the delivery. Fairclough v. Pavia, 9 W. H. & G. 690.

If a bill or note, which before it became due was negotiable, be endorsed after it is due, the legal effect of the endorsement in favour of any person is to make the instrument payable to him or to his order, and his endorsement will transfer the note to another. Leavitt v. Putnam, 3 Comstock 597. It is so, notwithstanding that in the first mentioned endorsement there may have been omitted the words, "or order." S. C.

What then is the nature of the endorser's contract? The bill or note, which before it became due was negotiable, does not cease to be negotiable by being dishonoured. An endorsement of a note, after it becomes due, is equivalent to an order on the maker to pay the amount; the endorsement is still but a conditional contract to pay in the event of a demand or due diligence to make a demand on the maker, and notice of his

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