71 N.Y.S. 420 | N.Y. App. Div. | 1901
The complaint alleges that on or about January 15, 1891, the Pacific Coal and Coke Company, a corporation of the State of Colorado, made and delivered to Henry B. Hyde a certain promissory note dated Denver, Col., January 15, 1891, in and by which said corporation for value received promised to pay to the order of said Henry B. Hyde, six months after date, $15,000 at the State National Bank of Denver, with interest; that at the time of the making and delivery of the said note by said Pacific Coal and Coke Company to said Henry B. Hyde, and as collateral security for the payment thereof, and also to effectually secure, and indemnify the said Henry B. Hyde for or on account of any assignment, indorsement or guaranty of said note, said company granted, assigned, sold and conveyed unto William R. Marker, trustee, all its property and estate of every kind and description; that on or about the 1st day of June, 1894, the said Henry B. Hyde, in consideration of the sum of $16,876.56 to him in hand paid by the Colorado Fuel and Iron Company, also a corporation of the State of Colorado, duly indorsed, and delivered, so indorsed, said promissory note to said the Colorado Fuel and Iron Company, said sum being the full
'This action was commenced on the 20th of December, 1899, and. "to the complaint the defendants demurred on the ground that it does not set up facts sufficient to constitute a cause of action. It séems to be conceded in this court, as it was in the court below, that ¡the - complaint was fatally defective unless the failure of the holder ¡to demand payment of the note from the maker was excused. The ¡transfer of the note by Hyde to the Colorado Fuel and Iron Company is alleged to have been made on the 1st of June, 1894, long after the note had become due. It was at that time, therefore, a discredited instrument, having been nearly three years overdue The effect of the indorsement and delivery for a valuable consideration of-an overdue' note was not discussed. The rule, however, is ^generally -stated in Daniel on Negotiable Instruments (Vol. 1, § 724a) ¡that “after maturity negotiable paper still passes from hand to hand ad wijkiiinim until paid. Moreover, the indorser, after ¡maturity, writes in the .same form and is bound only upon the same «condition of-demand upon the drawer and notice of non-payment ¡as any .other indorser.” The indorsement of a negotiable instrument-is 'a fresh and substantive contract by which the indorser -engages that the bill or note will be accepted or paid, as the case miay be, according to its purport, but this engagement is condi
The plaintiff relies upon a line of authorities of which Mechanics’ Bank of New York v. Griswold (7 Wend. 165) seems to be the leading case in this State. That was a case of a transfer of a promissory note before maturity, and the question arose upon a demurrer to the declaration. The action was against the defendant as an indorser. The declaration, after alleging the making, indorsement and delivery of the note, alleges that after the making of the note and before it fell due; the makers of the note transferred certain goods, chattels and effects, and assigned certain notes, accounts, debts and demands, the property of them (the makers), to the defendant and one Ford upon trust to dispose of the property and to collect the debts, and out of the proceeds thereof, after deducting the charges of the trust, to pay the debts of the makers in a certain order, and first to pay and satisfy all notes and debts for which the defendant and Ford, or either of them, were bound as sureties cr indorsers; that the value of the property and debts transferred tar exceeded the charges of the trust and the amount of all
It seems to follow, therefore, that these allegations failed to bring the case within the exceptions by which a demand and notice of non-payment is excused, and we think the j udgment appealed from "was right and should be affirmed, with costs.
Van Brunt, P. J., Patterson, O’Brien and Laughein, JJ., concurred.
Judgment affirmed, with costs.