§ 100. When delay in making presentment is excused. a. Statutory provision.- The Negotiable Instruments Law provides as follows: Delay in making presentment for payment "is excused when the delay is caused by circumstances beyond the control of the holder and not imputable to his fault, misconduct, or negligence. When the cause of delay ceases to 66 operate, presentment must be made with reasonable diligence." 72 This is also the rule as contained in the English Bills of Exchange Act.73 No change is made in the general rule by the statute. It has been recognized by all the leading textwriters and is supported by the authority of the courts." 76 75 b. Circumstances causing delay. The existence of a malignant and contagious disease in the place where the instrument is payable would be a valid excuse for a failure to present at that place. The sickness of the holder of an instrument will excuse a delay in the presentment thereof, if it is of so severe a nature as to preclude him from making such presentment or directing others to make it;77 but the absence of the holder from his home at the time of the maturity of the instrument will not excuse the delay.78 Where a bill payable at a certain place was deposited in a post-office by the holder in ample time to reach such place before the day of its payment, the delay in the delivery of such bill caused by the mistake of the post-office officials will be excused.79 72. Neg. Inst. L. (N. Y.), § 141. For same section in statutes of other States see Appendix. 73. English Bills of Exchange Act, 1882, 46(1). 74. On this subject Chitty (chap. 9 [8th ed.], 422), says: "Provided the party entitled to a bill or note produce it, as soon as the impediment has been removed, and, in the meantime, takes every step in his power to obtain payment at the appointed time, a delay in presenting the instrument itself at maturity may be excused, on account of any accident or circumstance not attributable to the party's own fault. Thus, it has been considered, that the detention of the bill by contrary winds, or the holder's having been robbed of the bill, or the like, would afford an adequate excuse, provided he present it as soon after ward as he is able. So the occupation of the country by an enemy will constitute an adequate excuse for delay." See also Story on Bills of Exchange, § 327. 75. Windham Bank v. Norton, 22 Conn. 213, 56 Am. Dec. 397; Barker v. Parker, 6 Pick. (Mass.) 80; Benton v. Martin, 31 N. Y. 382. 76. Hanauer v. Anderson, 16 Lea (Tenn.), 340; Tunno v. Lague, 2 Johns. Cas. (N. Y.) 1, 1 Am. Dec. 14. 77. Wilson v. Senier, 14 Wis. 380. 78. McCrummen v. McCrummen, 5 Mart. (N. S.) (La.) 159. 79. Windham Bank v. Norton, 22 Conn. 213, 56 Am. Dec. 397. In this case the court said: "The general rule is that it must be presented for payment, on the very day on which, by law, it becomes due, and that, unless the presentment be so made, it is a fatal objection to any right of recovery against the indorser. But, although this is the general rule, it is not an universal one, and prevails only under the qualification, which is a part of the rule itself, that there is § 101. When presentment may be dispensed with. a. Statutory provision.- The Negotiable Instruments Law provides as follows: "Presentment for payment is dispensed with: "1. Where after the exercise of reasonable diligence present"ment as required by this act cannot be made; "2. Where the drawee is a fictitious person; 80 "3. By waiver of presentment expressed or implied." so This provision is also contained in the English Bills of Exchange Act.81 This act further provides that "the fact that the holder has reason to believe that the bill will on presentment be dishonored does not dispense with the necessity for presentment." 82 rule of the statute is in substantially all respects declaratory of the common law. The b. Exercise of reasonable diligence. It is a well-established rule that if the residence or place of business of the person primarily liable upon a negotiable instrument is not known and cannot be ascertained by reasonable diligence, and if such person cannot be found after a diligent search, a failure to present the instrument to him for payment will not relieve the indorser.83 It has been held that if the maker has no known residence or place of business, the holder will be excused from making any demand whatever.84 But to excuse the failure to demand payment it must be shown that due diligence was used to ascertain the whereabouts of the maker, or the location of his residence or place of business.85 The holder of an instrument in exercising due diligence to make a demand is not required to go outside of the State; so if the maker or acceptor departs from the State before the maturity of the instrument, and leaves to the knowl negligence or want of reasonable dili- McCullough, 4 Serg. & R. (Pa.) 480; gence in not making such present- Galpin v. Hurd, 3 McCord (S. C.), ment. The whole rule, therefore, more 394. properly stated is, that the presentment must be made on the day on which the bill becomes due, unless it is not in the power of the holder, by the use of reasonable diligence, so to present it." 80. Neg. Inst. L. (N. Y.), § 142. For the same section in statutes of other States see Appendix. 81. English Bills of Exchange Act, 46 (2), a, b, and c. 82. English Bills of Exchange Act, 46 (2-a). 83. Steward v. Eden, 2 Caines (N. Y.), 121, 2 Am. Dec. 222; Duncan v. The fact that the maker of a note could not be found in the city wherein it was executed does not excuse a demand of payment, as against the indorser. Hahn v. Brown, 101 Cal. 445, 35 Pac. 1035; Woodruff v. Daggett, 20 N. J. L. 526. 84. Adams v. Leland, 30 N. Y. 309; Ratcliff v. Planters' Bank, 2 Sneed (Tenn.), 424; Shepherd v. Citizens' Ins. Co., 8 Mo. 272; McKee v. Boswell, 33 Mo. 567. 85. Otis V. Hussey, 3 N. H. 346; Davis v. Eppler, 38 Kan. 629, 16 Pac. 793. edge of the holder no person to represent him, a demand will be unnecessary to bind the indorser.86 Where the maker of a note has absconded before its maturity, a demand of payment will be excused.87 As to what will constitute reasonable diligence the circumstances in each particular case must control. Where the holder of a note makes a diligent inquiry of all the parties thereto within his reach, and he is unable to ascertain from them the residence of the maker, a personal demand on the maker will be excused.88 But if the inquiry by the holder to ascertain the residence of the maker of the note is confined merely to the place where the note is dated, sufficient diligence is not shown to charge the indorser.89 86. Magruder v. Bank of Washington, 9 Wheat. (U. S.) 598, 6 L. Ed. 170; Whitely v. Allen, 56 Iowa, 234, 9 N. W. 190; Caldwell v. Porter, 17 N. H. 27; Adams v. Leland, 30 N. Y. 309; Gist v. Lybrand, 3 Ohio, 307, 17 Am. Dec. 595; Putnam v. Sullivan, 4 Mass. 45, 3 Am. Dec. 206; Hale v. Burr, 12 Mass. 86; Taylor v. Snyder, 3 Den. (N. Y.) 145, 45 Am. Dec. 457; Bruce v. Lytle, 13 Barb. (N. Y.) 163; Lehman v. Jones, 1 Watts & S. (Pa.) 126, 37 Am. Dec. 455; Gillespie v. Hannahan, 4 McCord (S. C.), 503; Ratcliff v. Planters' Bank, 2 Sneed (Tenn.), 425. dorser. Where the maker is a seaman 87. Circumstances under which demand may be dispensed with. In the case of Taylor v. Snyder, 1 Den. (N. Y.) 145, 150, the court in giving its opinion upon this subject uses the following language: "Where a promissory note is not made payable at any particular place, the general rule of law is that in order to charge the in- 88. Staylor v. Ball, 24 Md. 183. In dorser payment must be demanded of the case of Adams v. Leland, 5 Bosw. the maker personally, or at his dwell- (N. Y.) 411, affd. in 30 N. Y. 309, it ing-house or other place of abode, or was held that where the notary went at his counting-house or place of busi- to the last place of business of the ness.' But, although such is the gen- makers, and was sent from there to eral rule, yet, under various circum- another place, and was there told that stances, a demand in any form or man- the makers had removed to the West, ner may be dispensed with. It is a the notary used reasonable diligence question of diligence, and if a demand in ascertaining the whereabouts of is known to be impracticable, proper efforts for that purpose having been made, the indorser will still be held liable, due notice having been given to him by the holder. Thus where the maker has absconded, that will ordinarily excuse a demand, and notice of the fact is sufficient to hold the in such makers. See also Belmont Bank v. Patterson, 17 Ohio, 78. 89. Hartford Bank v. Green, 11 Iowa, 476. Where a note was lodged at a bank for collection, and demand for payment was made there with inquiry of the officers as to the residence of the maker, the directors were at 91 c. Insolvency of principal debtor.- The general rule, supported by the weight of authority, is that the mere insolvency of the drawee or acceptor of a bill of exchange is not an excuse for the neglect to present it for payment,90 and it seems to have been held that the insolvency of the maker of a promissory note, although known to the indorser, will not dispense with demand of payment. But there are a number of authorities which maintain the doctrine that where the maker of a note is insolvent when it falls due, or is without property sufficient to pay it, the holder has an immediate right of action against the indorser, though he had knowledge of such insolvency, without a preliminary demand on the maker.92 But even under this doctrine the reputed insolvency of the maker is not sufficient to dispense with the demand; it must be such an absolute and notorious insolvency as leaves no doubt of the fact.93 d. Waiver of presentment. It is the right of an indorser or drawer that a demand should be made upon the person primarily liable on the instrument, but notice of nonpayment being for his benefit may be waived by him.94 The right of demand and notice is not a part of the contract, but is a step in the legal remedy, and may be waived at any time.95 A waiver may be made in behalf of an indorser or drawer by one of a partnership, or by a duly authorized agent; the waiver may 96 once consulted, and her name was not found. No inquiry was made of the actual holder of the note and it a peared that the maker, being a married woman, kept a boarding-house in the city; it was held that due diligence had not been used in presenting the note for payment. Packard v. Lyon, 5 Duer (N. Y.), 82. 90. Smith v. Miller, 52 N. Y. 545; Jackson v. Richards, 2 Caines (N. Y.), 343; Hunt v. Wadleigh, 26 Me. 271, 45 Am. Dec. 108; Hawley v. Jette, 10 Ore. 31, 45 Am. Rep. 129. 91. Phipps v. Harding, 70 Fed. Cas. No. 468, 17 C. C. A. 203; Adams v. Torbert, 6 Ala. 865; Buck v. Cotton, 2 Conn. 126, 7 Am. Rep. 251; Kimmel v. Weil, 95 Ill App. 15; Groton v. Dallheim, 6 Me. 476; Farnum v. Fowle, 12 Mass. 89, 7 Am. Dec. 35; Whitten v. Wright, 34 Mich. 92; Jackson v. Richards, 2 Caines (N. Y.), 343; Moore v. Alexander, 63 App. Div. (N. Y.) 100. 71 N. Y. Supp. 420; O'Neil V. Meighan, 33 Misc. (N. Y.) 613, 68 N. Y. Supp. 888. 97 92. Forbes v. Rowe, 48 Conn. 413; Hawkinson v. Olson, 48 Ill. 277; Couch v. First Nat. Bank, 64 Ind. 92; Gibbs v. Cameron, 9 Serg. & R. (Pa.) 198, 11 Am. Dec. 699; McClellan v. Clark, 2 Brev. (S. C.) 106. But see contra, Allwood v. Haseldon, 2 Bailey (S. C.), 457. 93. Oliver v. Munday, 3 N. J. L. 982; Keddell v. Ford, 3 Brev. (S. C.) 178, 6 Am. Dec. 569. 94. Stanly v. McKelrath, 86 Cal. 449, 25 Pac. 16, 10 L. R. A. 545; Robinson v. Barnett, 19 Fla. 670, 45 Am. Rep. 24; Pollard v. Bowen, 57 Ind. 232; Taunton Bank v. Richardson, 5 Pick. (Mass.) 436; Emery v. Hobson, 62 Me. 578, 16 Am. Rep. 513; Power V. Mitchell, 7 Wis. 161. 95. Barclay v. Weaver, 19 Pa. St. 396, 57 Am. Dec. 661. 96. Darling v. March, 22 Me. 184; Driggs v. Driggs, 11 N. Y. St. Rep. 256. 97. Whitney v. South Paris Mfg. Co., 39 Me. 316. be by a parol agreement made before the instrument falls due.98 The Negotiable Instruments Law provides that: "A waiver of "protest, whether in the case of a foreign bill of exchange or "other negotiable instrument, is deemed to be a waiver not only "of a formal protest, but also of presentment and notice of dis"honor." "When a negotiable instrument contains in the body thereof an express waiver of demand and notice, it forms a part of the contract which is binding upon each indorser.1 A waiver may be implied from an agreement or promise made by a party liable upon the instrument to pay it at maturity. An agreement 98. Maples v. Traders' Deposit N. W. 167; Hammett v. Trueworthy, Bank, 15 Ky. L. Rep. 879; Keyes v. 51 Mo. App. 281; Fisher v. Price, 37 Winter, 54 Me. 399; Fuller v. McDon- Ala. 407. ald, 8 Me. 213, 23 Am. Dec. 499; Field v. Nickerson, 13 Mass. 131; Porter v. Kembell, 53 Barb. (N. Y.) 467; Annville Nat. Bank v. Kettering, 106 Pa. St. 531, 51 Am. Rep. 536; Worden v. Whitehall, 7 Wis. 161. 1. Woodward v. Lowry, 74 Ga. 148; Dunnigan v. Stevens, 122 Ill. 396, 13 N. E. 651; Rooker v. Morris, 61 Ind. 286; Sohn v. Morton, 92 Ind. 170; Iowa Valley State Bank v. Sigstad, 96 Iowa, 491, 65 N. W. 407; Phillips v. Deppo, 93 Iowa, 35, 61 N. W. 216; Bryant v. Lord, 19 Minn. 396; Smith v. Pickham, 8 Tex. Civ. App. 326, 28 S. W. 565; Furth v. Baxter, 24 Wash. 608, 64 Pac. 798; Hoover v. McCormick, 84 Wis. 215, 54 N. W. 505. Parol testimony. It has been decided that parol testimony to prove a waiver does not contradict the written contract between the indorser and holder; and that a promise to pay if not paid by the other parties when due, made by an indorser at the time 2. Implied waiver.- In the case of of indorsing, may be regarded as a Cady v. Bradshaw, 116 N. Y. 188, 22 waiver of a demand upon the maker. N. E. 371, 5 L. R. A. 557, the facts Boyd v. Cleveland, 4 Pick. (Mass.) relied upon to constitute a waiver 525. And in the case of Hibbard v. were as follows: Prior to the date Russell, 16 N. H. 410, 41 Am. Dec. at which the note matured, the de733, the court said: "It is perfectly fendant called upon the plaintiff and settled, that a waiver of demand and asked him if he would extend the note notice need not be in writing, but that another year if the interest should be the modification that such waiver paid. The plaintiff responded that he gives to the contract, created by the was willing if the defendant would indorsement and delivery of the nego- leave his name upon it; let it be as it tiable paper, is not such as is by the was. The plaintiff further asked the Statute of Frauds required to be put defendant if he and Mr. Rowland in writing; that no fixed verbal for- would let their names remain on the mula is necessary to constitute such note, and the defendant said yes, if a waiver, but that like any other fact the plaintiff would let the note stand it may be proven by direct evidence, just as it was before the maturity of or inferred from the expressions and the note. The plaintiff saw Rowland conduct of the parties." who consented to the extension. The 99. Neg. Inst. L. (N. Y.), § 182. court said: "The question presented, See post, chap. IX. It has also therefore, is whether the facts proven been held that when an indorser of constitute a waiver of the indorser's a note writes on the back of it "No- right to a demand of payment, and tice of protest waived by me," that notice of nonpayment thereof. Now, evidence is inadmissible to show that it is true that the indorser did not he did not intend to waive present- say in so many words, 'I waive dement for payment. Buckley v. Bent- mand and notice of nonpayment,' but ley, 42 Barb. (N. Y.) 646. See also when he asked that the time of payWolford v. Andrews, 29 Minn. 250, 13 ment be extended a year, he, in fact, |