Downes v. Church
ON a certificate of division from the Circuit Court of the United States for the district of Mississippi.
This was an action of assumpsit founded on the second of a foreign bill of exchange, by the endorsee against the endorser, for non-acceptance. The plaintiffs declared upon the 'second' of the set of exchange, which 'second of the set' was protested for non-acceptance; and the same, with the protest thereto attached, was read in evidence to the jury. Whereupon a question arose, whether the plaintiffs could recover upon the said second of exchange, without producing the first of the same set, or accounting for its non-production; upon which the judges were opposed in opinion. Whereupon the same was ordered to be certified to the Supreme Court of the United States.
The case was submitted to the Court, on a printed argument, by Mr. O. Hoffman, for the plaintiff. No counsel appeared for the defendant.
Mr. Hoffman stated:--
The only question that arises is, whether the plaintiff can recover upon the second of exchange, without producing the first of the same set, or accounting for its non-production.
These bills are so many securities for the same debt, and so drawn for convenience, and to avoid accident. Where one is paid, the one so paid has discharged the duty of the whole, and the others cease to have legal existence. They contain this very condition on their face; and show that each has a full operation, dependent only upon the rest not having discharged their office.
If one is sufficient to present, so as to authorize the holder to demand payment, it would seem to follow, as a matter of course, that that which gave the right to demand payment or acceptance would be sufficient to support an action for non-payment or non-acceptance. If the presentation of one is sufficient to create a liability, that one must be sufficient to support an action founded on such liability. Whatever gives the right, must be enough to sustain the remedy.
Not a single case has been found where the objection has been taken or decided by the Courts, although the books abound with cases where the objection would have applied. The only exception to the general rule that either one of the set can perform the office of all the set is, that the particular bill protested must be the one declared upon and given in evidence, in order to save the drawer or endorser from liability to the person who may have interfered, supra protest, for his honour. Chancellor Kent says: 'If several parts, as is usual, of a bill of exchange be drawn, they all contain a condition to be paid, provided the others remain unpaid, and they collectively amount to one bill, and a payment to the holder of either is good, and a payment of one of a set is payment of the whole.
'The drawer or endorser to be charged on non-acceptance or non-payment is entitled to call for the identical bill or No. of the set protested, before he is bound to pay, and it would be sufficient to produce it at the trial or account for its absence; as, without it, he might be exposed to claims from some bona fide holder or person, who had paid it, supra protest, for his honour.' 3 Kent's Com. 109.
The same doctrine was still more strongly recognised by the Court in Kenworthy vs. Hopkins, 1 Johnson's Cases, 107; which case the Court will find cited and commented upon in Wiles vs. Whitehead, 15 Wendall, 527.
In this latter case, the Court decided that the set actually protested must be produced in a suit brought by endorsee against endorser, to guard against a subsequent claim by an acceptor, supra protest. The Court say 'that the identical bill protested must be presented.
'It is true, as a general rule, that payment of one of the set is payment of the whole; but if the drawer or endorser is entitled to call for the identical bill dishonoured, before he is obliged to pay it; the omission to do so would subject him to the charge of negligence, and make him accountable to any person who had accepted it for his honour.
'His security, therefore, requires that he should be allowed to call for the bill protested, before a recovery is permitted to be had against him.'
There is a dictum in Starkie, that 'in case of foreign bills drawn in sets, both the sets should be produced.' 2 Starkie on Evidence, 142. But no authorities are cited to support this, and it is in hostility to the reasoning of the authorities to which I have referred.
Mr. Justice STORY delivered the opinion of the Court:--