Artisans' Bank v. Backus

The question of the alteration of the note was one of pure fact for the jury. The learned justice who tried this action could not have withdrawn the question from their consideration. The notice of protest was sufficient. It described the note by giving its amount, *251date, and the time it was to run, and that it was protested for non-payment. The inference is, that it was demanded and protested on the day it became due (Young agt. Lee, 2 Kern. 551). The only remaining question is as to the discharge of the defendant Backus, by reason of the bank having extended the time of payment to Gilmore, the maker of the note. Gilmore testifies to a verbal agreement with the president of the bank, that the bank was to advance him $10,000, and take mortgages on certain real property for this advance and the old indebtedness, which included this note in suit, and extend the time for the payment of the old debt for one year; that this agreement was reduced to writing by the attorney of the bank, but was never signed by either party; that the mortgages were given in pursuance of this agreement by Gilmore to the bank; that the bank never advanced the money. One of the mortgages given was subsequently canceled by the bank, which cancelation, with the mortgage, was accepted by Gilmore without in any way being paid. This mortgage was introduced in evidence, and shows no extension of time of payment to Gilmore, but is payable on the instant of its execution. The parol agreement, if one was made, was merged in this mortgage, and that only expresses the true agreement between the parties (Burbank, President agt. Beach, 15 Barb. 326). There is, therefore, no sufficient proof that the time of the payment of the note was ever extended by the bank to Gilmore. It was not a discharge of Backus to take this mortgage to secure the note in question, and to re-deliver it to Gilmore without Backus’ assent and without payment, if the time of payment was not extended (Pitts agt. Congdon, 2 Comst. 352).

Judgment affirmed, with costs.

The case shows no request to charge on the subject of the alteration of the date of the note, and no motion for a nonsuit on that ground at the close of the evidence, and nothing in the charge as contained in the case referring to it; the inference may be fairly drawn, either that the question was properly submitted to the jury, or *252wholly waived by the defense after the evidence was all before the court.

The counsel for the defense waived all argument at the hearing of the appeal, in respect to the motion for a nonsuit at the close of the plaintiff’s evidence, but it has been considered by a member of the court as a material ground for granting a new trial, on the motion of the court only, and I shall therefore refer to it more at large: The subject is on the defendants’ points, but counsel expressly stated that he should not argue it. The question raised by the motion was whether the burden of proof rested upon the plaintiff to explain an alteration of the date of the note.

The alteration was without any attempt at concealment or disguise, which usually attends a fraud; the figure 7 being plainly written over an 8, and affecting the period of maturity only one day, seemed rather an unimportant subject of fraud, under the circumstances of the parties, the bank officers being merely trustees. The presumption of law is in favor of innocence. It is stated in Greenleaf on Evidence (§ 564), that “ generally speaking, if nothing appears to the contrary, the alteration will be presumed to be contemporaneous with the execution of the instrument.” An exception to the rule of the presumption of innocence seems to be admitted by the English authorities in the case of commercial paper, the holder being required to explain every apparent and material alteration operating in his own favor.

The contrary rule has been held in some- cases in the United States, Davis agt. Jenney (1 Met. 221), holding that the burden of proof was on the defendant. In Cowen & Hill’s Notes (2 vol. p. 299, note 298), it is said to be quite doubtful how far these decisions will be followed by the American courts. The direct contrary has been holden in New Jersey (Cumberlank Bank agt. Hall, 1 Halst. 215).

In Rankin agt. Blackwell (2 Johnson’s Cases, 200), it is said by the court that “ alterations on the face of a note, unsupported by other proof, would not be competent evidence, it having been insisted by the defense that the jury might *253decide from such evidence whether the note had been altered or not.”

In Tillou agt. The Clinton & Essex Mutual Insurance Co. (7 Barb. 568), Judge Babculo says, it has long been a disputed point whether the burden of explaining an alteration apparent upon a paper devolved upon the party seeking to enforce it, or the party sought to be charged. But when the alteration is suspicious, and beneficial to the holder, the more sensible rule prevails, at least in this state and in England, that the presumption is against the party who sets up the paper. (Vide also Bailey agt. Taylor, 11 Conn. R. 531.)

In my opinion the ruling was correct under the circumstances of this case, but if not correct, the defendant did not rely upon his objection, but proceeded to give evidence on the subject, which was followed by other evidence on the part of the plaintiff, so that the fact became material to be submitted to the jury, and could not be determined as a question of law. A new trial will not be granted, on the ground that a nonsuit was refused when the plaintiff rested on insufficient evidence, if the necessary proof is afterwards supplied. (Schenectady & Saratoga Plankroad agt. Thatcher, 11 N. Y. R. 102 and 112; Lansing agt. Van Alstyne, 2 Wend. R. 561; Breidert agt. Vincent, 1 E. D. Smith, 542, 544.) The facts subsequently appearing were that the note was drawn by Gilmore, the maker, and indorsed by the defendant Backus, who delivered it to Mr. Platt, the president of the bank, to take up another note for the same amount, made and indorsed by the same parties, and held by the bank, which fell due on the 7th day of November, 1857, upon which day the note in suit, as altered, also bears date. Backus, the indorser, did not notice the date at all at the time he delivered it to Mr. Platt, who died sometime before the trial. Gilmore testified that the alteration was not made by him, and he did not know who made it. The 8th of November, 1857, fell on Sunday. The note was antedated and delivered to the president some days after the time it bears date. Mr. Platt delivered it seventy-six days before maturity to the discount clerk of the bank, who testifies that *254the alteration was then upon the note. Three witnesses, who are well acquainted with the handwriting of Mr. Platt, testify that the figure is not in his handwriting, and two of them, being acquainted with the handwriting of Gilmore, the maker, testify that the figure is in his writing. There were some circumstances in the evidence of Gilmore, tending to impair his credit as a witness. The body and date of the note, as at first drawn, were in the writing of Gilmore, and he intended to have it bear date the same day that the former note fell due.

Under this evidence, it was clearly a question for the jury to determine by whom the alteration was made,' and whether before or after the indorsement by the defendant. The maker never had the possession of the note after he signed and delivered it to the indorser. In my opinion the evidence sustains the verdict, and that the alteration was contemporaneous with the making and indorsement.

The sole remaining question upon which the members of this general term have any difference of opinion, relates to the sufficiency of the notice of protest.

The only possible defect which can be attributed to this notice is the omission to.date it. New York is stated in such relation as to appear to be the place where it emanated, but the day, month and year are omitted. The rule is laid down by Judge Weight as to the facts necessary to appear in a notice of protest in the case of Hodges agt. Shuler (20 N. Y. R. 114,118). He says, in that case, “ a notice which omits an essential feature of the note, or misdescribes it, is an imperfect one, but is not necessarily invalid. It is invalid only when it fails to give that information, which it would have given but for its particular imperfection; and even in case the notice in itself be defective, if, from evidence aliunde of the attendant circumstances, it is apparent that the indorser was not deceived or misled as to the identity of the dishonored note, he will be charged. A note is well described when its maker, payee, date, amount and time and place of payment are stated. In that case the note was made by a railroad company, but was described in the notice as made *255by“S. Henshaw, treasurer,” and it was held sufficient, although conceded to be a misdescription of the maker, on the ground that it appeared that the indorser was not deceived or misled thereby. In the present case all these particulars are fully complied with.

The notice states that the note is dated “ November 7, 1857.” The jury found that to be the true date, and that there had not been any fraudulent alteration. The notary proves the time and manner of service, and the defendant does not deny that he received the notice in due time, assuming the true date of the note to be the 7th and not the 8th of November, 1857. The name of the maker, the fact that the defendant is the indorser, the amount, the date, the place of payment, and the time (90 days) are all exactly furnished in the notice.

The time of service was correct, and the defendant received the notice. I am unable to perceive that anything was omitted to apprise the defendant of every requisite in respect to the demand and neglect or refusal of payment by the maker, so as to charge him as an indorser. Had the jury found that there had been an alteration in the date of the note after its indorsement by the defendant, there would have been a failure to serve the notice on the proper day. But this defense of a defective notice would have been unimportant had the jury found for the defendant on the question of alteration, as the note would have been void on that ground.

We must now assume that the true date of the note was that mentioned in the notice. The service was then regular as to time, and the notice contained every essential statement necessary to apprise the defendant that the note which he had indorsed for Gilmore had been protested.

The omission to date the notice cannot mislead where it is served on the proper day. The notice is given at the proper time. There is no evidence that the defendant had indorsed any other note of a like description. We cannot infer that there were others similar to it (Young agt. Lee, 2 Kern. 551.)

The judgment should be affirmed, with costs.

It is very clear that when the plaintiff rested there was no evidence to submit to the jury on the question of the alteration of the note. The action was against the indorser. The note on its face showed an alteration of the date by writing 7 for the day of the month over 8. No explanation was given of the alteration, and the indorser was sought to be charged on a presentation of the note on the 8fch of February, being a recognition by the notary of the 7th of November as the correct date of the note. The liability of the indorser depended on the true date of the note. If the note, when indorsed by him, was dated the 8th, then he could only be made liable by a protest on the 9th of February. If the 7th is adopted as the date of the note, the mode of alteration and the fact of such alteration having been made when the defendant indorsed it must be shown, to hold him liable as indórser. When commercial paper is altered in anything material, the onus rests on the holder to show that such alteration was properly made. As no evidence was given on the subject of the alteration when the plaintiff rested, the case should not have gone to the jury, and the defendant’s motion to dismiss the complaint should have been granted.

Was there any evidence given afterwards to alter the state of the case ?

The defendant was sworn, and testified that he did not make the alteration; that he did not know who made it, and the first time he saw it was in December, 1860; that he never authorized the alteration to be made; that he received the note from Gilmore, and indorsed it and took it to the Artisans’ Bank, and gave it to the president.

Gilmore, the maker, was sworn, and testified that the note was dated the 8th; that he did not make the alteration; that he did not know who did; that he did not authorize any one .to do so, and had no knowledge of it until three years after the date of the note.

On the part of the plaintiffs it was proven that the note had been altered before it became due, and was not altered afterwards; that it came to the hands of the discount clerk *257when discounted, and that it then bore the same date as now, and was not altered afterwards. It was also proved that the alteration was not made in Platt’s handwriting, and was in Gilmore’s handwriting. Upon this evidence the question was submitted to the jury. If the action had been against the maker, the evidence would have been submitted properly to the jury as to his liability, but I am at a loss to see anything that brings home to the indorser any knowledge of this alteration. He utterly denies all knowledge of it between the indorsement and the trial, and the only fact on which he is sought to be made liable, is his delivery of the note indorsed by bim to the president. There was a period of time when the alteration might have been made not reached by any of the witnesses, viz.: after its delivery and before it was passed by the officer of the bank to the discount clerk; and whether such alteration was made by Platt or by Gilmore would be immaterial. If without the knowledge of the defendant, he would not be chargeable.

I have noticed these facts more at large, as bearing upon the question as to the sufficiency of the notice of protest. The notice of non-payment was not dated. It stated that a note dated 7th November, 1857, and indorsed by the defendant, was protested for non-payment. There is no proof from the defendant as to the day of service, which might perhaps supply the difficulty, The only evidence was the notary’s certificate that on the 8th February, 1858, he served the notice by mail.

This case very much resembles that of Wynne agt. Alden, (4 Denio, 163), except that the point decided in that case is presented more strongly by the notice proved here. There the notice was without date, and stated that the note “ had this day been presented for payment and payment refused.”

The court held the notice defective; saying, the notice being without date, it is impossible to ascertain from the paper itself what day in particular was intended.

In Ransom agt. Mack (2 Hill, 587), it was held that whether the notice was sufficient was a question of law (Rennie agt. Downer, 23 Wend. 720).

*258■In Bela Hunt agt. Higgins (9 Abbott, 422), it was held that an error in the day on which the note was protested was fatal. The cases of, CooTc agt. Litchfield (5 Selden, 279), and Youngs agt. Lee (2 Hernán, 552), were cases in which the date and other matters were all stated but some defect alleged as to the day of protest. In Home Ins. Go. agt. Green, a notice which omitted the maker’s name was held insufficient to charge the indorser.

In Hodges agt. Shuler (22 New York, p. 115), Weight, J. in speaking of the sufficiency of the notice, says, “ a notice is well described when its maker, payee, date, amount, and time and place of payment are stated.” Such should be the contents of the notice. But some of the cases have, from time to time, sought to avoid the hardship of holding a notice defective for any of these requisites having been omitted, if they could find something else to show that the party was not misled or left in ignorance. Thus, where the maker and indorser’s names were misplaced, it was held not to mislead, because the error was known to the indorser. So the want of saying that the payment of the note had been demanded and refused, was considered cured by saying the note was protested, and the holder looked to the indorser for payment. So in cases like this, the want of stating the day on which payment was demanded, was relieved by the date of the notice being on the day the note became due. But in no case has it been held that a notice without date, and not stating on what day it was presented for payment, was sufficient.

It seems to me this notice was insufficient for want of a date, or for want of stating the day of demand in the body of it, and that a new trial should be granted.