First National Bank v. Slette

67 Minn. 425 | Minn. | 1897

START, C. J.

This action is based upon an obligation, which is substantially in these words:

Ui '$1,673. Halstad, Minn., July 26th, 1894.

“For value received, we promise to pay to the order of the John Good Cordage & Machine Company the sum of sixteen hundred and seventy-three dollars, as follows: Payable by New York or Chicago exchange. $560, Nov. 15th, 1894; $560, Dec. 1st, 1894; $560, Dec. 15th, 1894. Without interest, if paid as due; if not, then legal rate from date until paid.”

The only question on this appeal is whether this is a, negotiable instrument under the law merchant. It is absolutely essential, in order to constitute a promissory note under the law merchant, that the promise be to pay in money. If this instrument can be strued as an absolute promise to pay in money $1,673, with excha^6^, it is negotiable; otherwise, not. Hastings v. Thompson, 54 Minn. 184, 55 N. W. 968.

The case of Bradley v. Lill, 4 Biss. 473, Fed. Cas. No. 1,783, is the only one to which our attention has been called, where the language of the iustrument was similar to the one under consideration. In the case referred to the note was made in Chicago, and was payable at New York, “in” exchange; and it was held that the note was negotiable, upon the ground that the promise was to pay the sum named in the note, “with” exchange, which was a mere incident to the debt.

In the case at bar the note is not payable at any particular place, and the promise is, not to pay a given number of dollars in money “with” — that is, plus — the current rate of exchange, but it is to pay the sum named in the note by New York or Chicago exchange. The holder of this instrument cannot demand in payment thereof $1,673 in money, plus the cost of exchange; for the maker is not bound to discharge his obligation except by means of inland bills on New York or Chicago. • Nor can the maker tender in payment $1,673 in money, with the cost of exchange; for his promise is to make payj ment by inland bills, which he must purchase in the market. The instrument, then, is not payable in money, and is, therefore, not a promissory note, within the law merchant. Easton v. Hyde, 13 Minn. 83 (90); Jones v. Fales, 4 Mass. 245; Irvine v. Lowry, 14 Pet. 293; 1 Daniel, Neg. Inst. §§ 55, 56; Tied. Com. Paper, § 29; 1 Rand. Com. Paper, § 90. In reaching this conclusion we have not been unmindful of the fact that, in commercial usage, bills of exchange are regarded as substitutes for money; but this usage cannot make them such.

Order reversed, and a new trial granted.