CHAPTER I.

BY, AND AGAINST WHOM, AN ACTION OF ASSUMPSIT ON A BILL, CHECK, OR NOTE, MAY BE SUPPORTED.

THE action of ASSUMPSIT is by far the most usual remedy on bills, checks, and notes; and indeed it appears to be the only remedy where no privity of contract exists between the parties, as between the indorsee and the acceptor of a bill, and a remote indorsee and maker of a note, in which case debt is not maintainable, or when the action is against an executor or administrator, against whom debt or simple contract is not in general sustainable."

With respect to the persons, by, or against whom, this action may be brought, it may be observed, in general, that whenever a legal right is created, or liability imposed, through the medium of these instruments, that right may be asserted, and that liability enforced, by this action. (439) Therefore a person may sue on a note payable to him, though in trust for a third party. And the wife may join in an action on a note made payable to her during the coverture. When there are several indorsers, it is not necessary that the action should be brought in the name of the holder, or of the last indorser: they may arrange the matter among themselves, and any one indorser may sue the acceptor or drawer, instead of the preceding indorser, striking out all the names below his own. (439) Where a merchant, carrying on trade on his own separate account, introduces into his firm the name of a clerk, who has no participation in profit or loss, but continues to re

a

Bishop v. Young, 2 Bos. & Pul. 78.

b Barry v. Robinson, 1 New. Rep. 293. Poth. tit. Contrat de Change, part 1. chap. 5. art. 2. per totum.

d Smith v. Kendall, 1 Esp. Rep. 231. 6 T. R. 123. S. C. Randall v. Bell, 1 M. & S. 723.

* Philliskirk et Ux v. Pluckwell, 2 M. & S. 393. Ante, 19. 1 Chitty on Plead. 3d edit. 20.

f Per Eyre, C. J. in Walwyn v. St. Quintin, 1 Bos. & Pul. 658. This doctrine was recognised in Parnell v. Townend, Trin. Term, 58 Geo. 3, on an argument of a demurrer, see post. But if a bill were really the property of another, and put into the hands of a defendant to set off against a claim on him, that might present a different question. Per Lord Ellenborough, in Cornforth v. Revetts, 2 M. & S. 512.

(439) The same practice is recognised in the United States. Livingston v. Clinton, 3 John. Cas. 264. Baker v. Arnold, 1 Caines' Rep. 269. 271. And where the plaintiff is in possession of the bill, when he commences the action, the simple act of indorsing it may be done afterwards. Ibid. See Ritchie v. Moore, 5 Munf. 388.

Where an action against an indorser was commenced on the same day that the note became due, but after the notice was put into the post-office, and the writ was served before the notice could be received by the course of the mail, it was held that the action was not commenced too soon. Shed v. Bret, 1 Pick. 401.

But where notice to an indorser who lived at another place, of non-payment and protest of a promissory note, was put into the post-office on the 13th, and by the course of the mail could not reach him before the 19th, it was held that a suit commenced against him on the 16th was too soon. Smith v. The Bank of Washington, 5 Serg. & Rawle. 318.

ceive a fixed salary, it was held, that in an action on a bill of exchange payable to the order of this firm, the clerk must be joined as a plaintiff, unless it be distinctly proved that he had no interest. And if a party, who has commenced an action on a bill, deposit it afterwards as a security in the hands of a third person, he may still proceed in the action, if the latter knew that the action was commenced; and if such third person, having had this notice, commence another action against the same defendant, the court will stay his proceedings. (439) And the drawer of a bill, after taking it up, may sue and arrest a bankrupt acceptor, who has not obtained his certificate, although a previous holder, has proved under the commission. *

The bona fide holder of a bill, check, or note, may in general maintain an action thereon against all the parties to it, whose names are to it, and who became so previously to himself. Thus the payee may, in default of payment, sue the acceptor, whether he accepted as drawee, or merely for the honour of the drawer, and he may also, in such case, sue the drawer. And indorsee may, in general, not only sue the acceptor and drawer, but also all the prior indorsers; and an assignee, by mere delivery, may sue the acceptor, drawer, and indorsers, but he cannot maintain an action against any person whose name is not on the bill, except the person who assigned it to him," and then only when the consideration of the transfer was a precedent debt, or a debt arising at the time, and not when he became the holder, by discounting the bill upon a purchase thereof, as sometimes occurs. However, a person to whom the drawer of a bill which had been accepted for value, has indorsed it after it was dishonoured, and after it had been paid by the drawer, may sue the acceptor in his own

name."

The drawer may maintain an action on the bill against the drawee, in case of a refusal to pay a bill already accepted, but not on a refusal to accept, in which latter case the action by him must be on the original consideration of the bill, or in some cases specially on the contract to accept; and any party who has given value for the bill, and has been obliged to pay in consequence of the default of the acceptor, may maintain an action thereon against all the parties antecedent to himself, and in this case he is said to hold the bill in his original capacity; and [344] the drawer of a bill, payable to the order of a third person, may, when the bill has been returned to him, and he has paid it, sue the acceptor..

g Guidon v. Mary Robson, 2 Campb. 97, ante, 129, 130, which explains Bacon

v. Searles, 1 Hen. Bla. 88.

P Cowley v. Dunlop, 7 T. R. 571. Death v. Serwonters, Lutw. 885. 888. Bosanquet v. Dudman, 1 Stark. 2, 3.

Symonds v. Parminter, 1 Wils. 185. 4 Bro. P. C. 604. The plaintiff drew a bill upon the defendant, to the order of Cleer and Co. which the defendant accepted, but did not pay; the plaintiff paid it and brought this action. The declaration stated, that the plaintiff drew the bill;

(439) An' assignment of a note made during the pendency of a suit, operates as a discontinuance of the suit. Hall v. Gentry, 1 Marsh. 555.

Where the holder of a bill sued the acceptor and charged him in execution, and the latter having obtained his discharge under the Lord's act, the holder then sued the drawer, who after paying the bill sued the acceptor, and charged him in execution, this was held to be regular." In the case of an acceptance for the accommodation of the drawer, such acceptor, if he has been obliged to pay, may sue the drawer on his implied contract to indemnify him, but not on the bill itself," though we have seen that he may retain money in his hands as an indemnity; and a person not originally party to a bill, having paid it supra protest, may maintain an action against all, or any of the parties to it, except the person whom he paid ; but the bail of the maker of a promissory note, who have paid it, cannot sue the indorsers ; and a banker who pays the acceptance of a customer, who has made it pay-[ 345 ] able at his banking-house, cannot sue thereon, as he does not stand in the situation of a party praying supra protest. (442)

But unless, under circumstances which must be specially stated on the record, no action can be maintained on a bill against a person who became party to it subsequently to the holder or plaintiff, for if it were otherwise, the defendant in such action might, as an indorsee deriving from the plaintiff, be entitled to recover back again, in another action

that the defendant accepted, but did not pay it; that the plaintiff became liable and did pay it, by reason whereof the defendant became liable and promised. The defendant demurred, and afterwards moved in arrest of judgment, and contended that the action could not lie; but the court, after two arguments upon the demurrer, and one on motion in arrest of judgment, were of opinion that it would, and judgment was given for the plaintiff. The defendant brought a writ of error in parliament, but did not appear at the bar to support it, and judgment was affirmed.

Louviere v. Laubray, 10 Mod. 36. The plaintiff drew a bill upon the defendant, which the defendant accepted, but afterwards refused to pay; upon this the bill was indorsed to the plaintiff, and the question was, whether he could maintain an action as indorsee; and per Parker, C. J. upon evidence that he had effects in the hands of the defendant enough to answer the bill, and consequently that the acceptance was not upon the honour of the plaintiff, the action is well brought, but if there were no effects, the action would not lie, and the plaintiff recovered.

* Macdonald v. Bovington, 4 T. R. 825, ante, 301; and Mead v. Braham, 3 M. & S. 91.

Young v. Hockley, 3 Wils. 346.
Ante, 196.

" Ante, 243.

Mertens v. Winnington, 1 Esp. Rep. 112. A bill was drawn by the defendant, and indorsed by Burton, Forbes, and Gregory.

The plaintiff paid it for the honour of Burton, Forbes, and Gregory, and brought this action against the defendant as drawer; the defendant contended that a person who paid for the honour of one of the parties, could only sue that party; but Lord Kenyon said he was to be considered as an indorsee, paying full value for the bill, and he directed the jury to find for the plaintiff.

148.

Hull v. Pitfield, 1 Wils. 46. Bayl.

The indorsee of a note sued the maker, and on payment by his bail, permitted them to sue the indorser in his (the indorsee's) name, but the court held that the payment of the money to the plaintiff by the bail for the drawer, was the same thing as if the drawer himself had paid it, and that the note was thereby absolutely discharged and satisfied; that the indorser of a note is only a warranter thereof; that the drawer will pay it, and if he does not, that the indorser will, and that it is the same thing whether the drawer himself paid the money, or his friend, as the bail did in this case.

y Holroyd v. Whitehead, 5 Taunt. 444. 1 Marsh. 128. 3 Campb. 530. S. C.

(442) The acceptor of a bill of exchange, who, at the time of acceptance, had no funds in his hands belonging to the drawer, although he has not paid the bill, may sue the drawer, if he has done something equivalent to payment; as if he is in confinement under a ca. sa. at the suit of the holder. Parker v. The United States, Peters' Rep, 262. See as to the right of the acceptor of a bill of exchange to sue, ib. 267.

against the plaintiff, the identical sum which he, the plaintiff, had previously recovered from him, which would introduce a circuity of action; and therefore where A. having declared on a promissory note against B. made by C. to A. and indorsed by him to B., and by B. again indorsed to A. and having obtained a verdict, the judgment was arrested.*

A plaintiff cannot in general maintain his action against the person from whom he received the bill, unless he gave him a valuable consideration for it. a

We have before seen, what objections may be taken in an action at the suit of a person attempting to derive an interest in a bill, by a transfer after it was due or paid;b and what laches, in the holder of a bill, will operate as a forfeiture of his right of action. If the holder of a bill make the acceptor his executor, and die, the right of action at law against all the parties is extinguished, unless the executor formally renounces. [346] Where a note or bill made by several, is joint and several, it is advisable to proceed in separate actions, if there be any doubt in proving the joint liability of all.

Whenever the holder of a bill, &c. has a remedy against several parties to it, he may commence and proceed in several actions against each of those parties at the same time; and an action commenced against one, will not preclude any other remedy against the others; but as the different persons liable on the bill are debtors to the holder in respect of the same debt, satisfaction by any one will discharge the others from liability as to the principal sum due on the bill, and if the holder reject an offer by a drawer or indorser of a bill, to pay debts and costs of the ac

Bishop v. Hayward, 4 T. R. 470. The plaintiff declared upon a note payable to himself or order, indorsed by him to the defendant, and by the defendant indorsed back again to him, and obtained a verdict. A rule was granted to show cause why the judgment should not be arrested, on the ground that according to the statement in the declaration, the plaintiff would be liable upon his indorsement to pay the defendant the sum, for which the verdict was given, and upon cause shown, the court held the objection good, because as the plaintiff had not stated it to be otherwise, his indorsement was to be considered as a legal existing indorsement; had any circumstances existed which exempted the plaintiff from answering upon his indorsement to the defendant, they should have been disclosed upon the record, and the declaration framed specially.

a Ante, 68 to 73. Mitchinson v. Hewson, 7T. R. 550. Cowley v. Dunlop, id. 571. Death v. Serwonters, 1 Lutw. 886. Simmonds v. Parminter, 1Wils. 495. 4 Bro. P. C. 704, acc. 2 Bla. Com. 446, contra; but see Mr. Christian's note.

Paramour v. Yardley, id. 542. Wankford v. Wankford, 1 Salk. 299. 2 Bla. Com. 511, 512. 3 Bla. Com. 18. Mainwaring v. Newman, 2 Bos. & Pul. 124, 5.

e

Gray v. Palmer, 1 Esp. Rep. 135, 6. f Windham v. Withers, 1 Stra. 515. Poth. pl. 160. Bayl. 151. Burgess v. Merrell, 4 Taunt. 468. Ex parte Wildman, 2 Ves. sen. 115. Lord Hardwicke. In cases of bills of exchange, or promissory notes, where there is a drawer and indorser, perhaps there may be more than one judgment against all, but there can be but one satisfaction.

Windham v. Withers, 1 Stra. 515. The plaintiff having obtained judgment against the drawer and indorser of a note, the principal in one, and the costs in both, were offered him, which he refused, and the court granted a rule to restrain him from taking out execution, and intimated that they would have punished him, had he taken out execution upon both judg

ments.

Claxton v. Swift, 2 Show. 441. 494. Lutw. 882. To an action against the indorser of a bill, the defendant pleaded that the plaintiff had recovered a judgment against the drawer, and that the judgment was still in force, and upon demurrer the court of King's Bench held the plea good, but the court of Exchequer Chamber held otherwise, and the judgment was reversed.