Beebe v. Brooks

Baldwin, J., delivered the opinion of the Court—Terry, C. J., concurring.

The assignment of errors by the appellant in this case raises but one question, that is, whether, if a note be indorsed after it is due, the indorser is entitled to demand and notice, before he is liable to his indorsee ? The authorities, it is conceded, are not consistent. But we think that the weight and number are both in favor of the affirmative of this proposition. It would be a useless and almost an endless task to review them all. Mr. Parsons, in his recent work on Contracts, takes this view of the question. Parsons on Cont., 2 vol., p. 231, note.

We think that the rule should be as uniform as possible in its operation upon the same description of commercial paper. Even if we did not consider ourselves foreclosed by authority, we should hesitate long before we reached the conclusion that the indorser meant, by placing his signature upon an overdue note or bill, to become unconditionally liable for that amount. We suppose that the universal understanding of business men is, not that an indorsement is not equivalent to a promissory note upon which the indorser may be sued the next day, but [311]that it amounts to no more than a guaranty of the solvency of the maker ; and that the indorsee may, if he makes demand upon the maker and fails to get the money, have recourse upon the indorser. This is the extent of the indorser’s liability. It is true that no time is expressly limited, as in cases of bills or notes not due, for demand and notice to the indorser; but the law requires a demand to be made in a reasonable time, and notice of default seasonably given. No notice having been given in this case to the defendant, Herzog, the indorser, the Court below properly gave judgment for him.

Judgment affirme.d.