of exchange. The latter view was adopted in New York. Bowen v. Newell, 8 N. Y. 190; 13 N. Y. 390. To the same effect also are the following cases: Ivory v. Bank of the State, 36 Mo. 475; Harrison v. Nicollet National Bank, 41 Minn. 488; Georgia National Bank v. Henderson, 46 Ga. 496; Minturn v. Fisher, 4 Cal. 36; Morrison v. Bailey, 5 Ohio St. 13. Contra: Champion v. Gordon, 70 Pa. St. 474; Westminster Bank v. Wheaton, 4 R. I. 30, In re Brown, 2 Story, 502. In all of these cases the particular question presented was whether the instrument was entitled to grace. But now that grace has been abolished the distinction is of little, if any, practical importance.

(c) Bill v. Stewart, 156 Mass. 508; Ames v. Meriam, 98 Mass. 294. Presentment and notice of dishonor are necessary in order that the holder may recover of the drawer. Herker v. Anderson, 21 Wend. 372; Dolph v. Rice, 18 Wis. 397. But unless the check answers the description of a foreign bill protest is not required. Wittich v. First Nat. Bank of Pensacola, 20 Fla. 843. See section 189.

8322. Within what time a check must be presented.A check must be presented for payment within a reasonable time after its issue or the drawer (a) will be discharged from liability thereon to the extent of the loss caused by the delay (b).

(a) It will be noted that this section applies only to the drawer, The rights of indorsers are governed by section 131. See note to that section. But, of course, where the drawer is discharged under section 322, the indorser, being a subsequent party, will be discharged under the provision of section 201, "that a person secondarily liable is discharged * * * by the discharge of a prior party."

(b) For cases applying the statute, see Gordon v. Levine, 194 Mass. 418, 421; Aebi v. Bank of Evansville, 124 Wis. 73, 77; Citizens' Bank v. First Nat. Bank (Iowa), 113 N. W. Rep. 481; Cox v. Citizen's State Bank, 73 Kans. 789; Moskowitz v. Deutsch (N. Y.), 46 Misc. 603; Singer Manufacturing Co. v. Summers, 143 N. C. 103. The holder's laches in presenting a check for payment constitutes no defense in an action against the drawer unless he is damaged by the delay, and then only to the extent of his loss.

A check purports to be made upon a deposit to meet it, and presupposes funds of the drawer in the hands of the drawee. But if the drawer has no such funds at the time of drawing his check, or subsequently withdraws them, he commits a fraud upon the payee, and can suffer no loss or damage from the holder's delay in respect to presentment or notice. In such case he is liable and cannot insist upon a formal demand or notice of non-payment. First National Bank of Portland v. Linn County National Bank, 30 Oregon 296; Industrial Bank of Chicago v. Bowes, 165 Ill. 70. For instances of unreasonable delay see Industrial Trust, Title and Savings Co. v. Weakley, 103 Ala. 458; Gifford v. Hardell, 88 Wis. 538; First National Bank of Wymore v. Miller, 43 Neb. 791; Comer v. Dufour, 95 Ga. 376; Grange v. Reigh, 93 Wis. 552; Western Wheeled Scraper Co. v. Sadilek, 50 Neb. 105; Gregg v. Beane, 69 Vt. 22; Holmes v. Roe, 62 Mich. 199. For instances of presentment in due time, see Loux v. Fox, 171 Pa. St. 68; Willis v. Finley, 173 Pa. St. 28; First Nat. Bank v. Buckhannon Bank, 80 Md. 475; Lloyd v. Osborne, 92 Wis. 93; Bell v. Alexander, 21 Gratt. 1; Purcell v. Ellemong, 22 Gratt. 739. But while as between the holder and drawer of a check, presentment may be made at any time, and delay in presentment does not discharge the drawer, unless loss has resulted to him, a different rule obtains as between holder and indorser. The holder, on accepting the check, assumes the obligation to present the same for payment within the time prescribed by law, and if payment is refused to give notice of non-payment. A failure to do this discharges the indorser from liability as such irrespective of any question of loss or injury. Carroll v. Swift, 128 N. Y. 19. It is not clear whether the death of the drawer revokes the authority of the bank to pay a check. There is no decision directly in point, and the view of the text writers differ. To meet the difficulty, the original draft of the Negotiable Instruments Law submitted to the commissioners contained a provision (which was taken from the statute of Massachusetts) as follows: "The death of the drawer does not operate as a revocation of the authority to pay a check, if the check is presented for payment within ten days from the date thereof." But it was thought by the conference of commissioners that this would be objected to in some of the States because of the effect it might have on the estates of decedents.

§323. Certification of check; effect of. Where a check is certified by the bank on which it is drawn the certification is equivalent to an acceptance (a).

(a) See Merchants' Bank v. State Bank, 10 Wall. 604; Cooke v. State Nat. Bank, 52 N. Y. 96; Farmers' and Mechanics' Bank v. Butchers' and Drovers' Bank, 16 N. Y. 125. Section 270 applies to an acceptance by a bank as well as by any other drawee, and hence it must be in writing; and an action cannot be maintained against the bank on an oral promise to pay. Van Buskirk v. State Bank, 35 Colo. 142, 145. The certification does not admit the genuineness of the indorser's signature. First Nat. Bank v. Northwestern Nat. Bank, 152 Ill. 296. As to the liabilities incurred, see section 112. Where a check delivered without the indorsement of the payee is afterwards certified by the bank, the holder may recover of the bank, though he is unable to obtain the indorsement of the payee. Meuer v. Phenix Nat. Bank, 94 App. Div. (N. Y.) 331.

8324. Effect where the holder of check procures it to be certified. Where the holder of a check procures it to be accepted or certified the drawer and all indorsers are discharged from liability thereon (a).

(a) See Minot v. Russ, 156 Mass. 458; Metropolitan Bank v. Jones, 137 Ill. 634; Meridian Nat. Bank v. First Nat. Bank, 7 Ind. App. 322; First Nat. Bank v. Leach, 52 N. Y. 350. The bank, for its own protection, usually charges up the check, when certified, to its depositor; and, as the drawer cannot thereafter draw against the same fund, it would be unjust that the money should be left in the bank at his risk and he remain liable upon the extended check. Bank v. Carter, 88 Tenn. 279. But where the check is certified when delivered it does not constitute payment any more than an uncertified check; and if it is presented promptly and dishonored, the loss must fall upon the drawer. Born v. First Nat. Bank, 123 Ind. 78; Cincinnati Oyster & Fish Co. v. Nat. Lafayette Bank, 51 Ohio St. 106; Bank v. Carter, supra. If the certification is made at the request of the indorsee, it operates to release the indorser, though made in the absence of funds belonging to the drawer. First Nat. Bank v. Currie, 147 Mich. 72.

§ 325. When check operates as an assignment.*-A check of itself does not operate as an assignment of any part of the funds to the credit of the drawer with the bank, and the bank is not liable to the holder, unless and until it accepts or certifies the check (a).

(a) Statute applied in Baltimore & Ohio R. R. Co. v. First Nat. Bank, 102 Va. 753; Van Buskirk v. State Bank, 35 Colo. 148; Tibby Bros. Glass Co. v. Farmers & Mechanics' Bank, (Pa.) 69 Atl. Rep. 280. Prior to the statute there was considerable conflict in the authorities. The rule adopted in the act is supported by the weight of authority. See Bank v. Millard, 10 Wall. 152; Bank v. Schuyler, 120 U. S. 511; Florence Mills Co. v. Brown, 124 U. S. 385; First Nat. Bank v. Whitman, 94 U. S. 343, 344; St. L. & S. F. Ry. Co. v. Johnston, 133 U. S. 566; Attorney-General v. Continental Life Insurance Co., 71 N. Y. 325, 330; First Nat. Bank of Union Mills v. Clark, 134 N. Y. 368; O'Connor v. Mechanics' Bank, 124 N. Y. 324; Maginn v. Dollar Savings Bank, 131 Pa. St. 362; Saylor v. Bushong, 100 Pa. St. 27; Covert v. Rhodes, 48 Ohio St. 66; Cincinnati H. & D. R. R. Co. v. Metropolitan Nat. Bank, 54 Ohio St. 60; Pickle v. People's Nat. Bank, 88 Tenn. 380; Boetcher v. Colorado Nat. Bank, 15 Col. 16; Hopkinson v. Foster, L. R., 18 Eq. 74. Contra, Fonner v. Smith, 31 Neb. 107; Munn v. Burch, 25 Ill. 35; Bank v. Patton, 109 Ill. 479, 485; Doty v. Caldwell, 38 S. W. Rep. 1025; Nat. Bank of America v. Nat. Bank of Ill., 164 Ill. 503. But while the mere making and delivery of a check in the ordinary course of business does not operate as an assignment of the fund, it is yet competent for the parties to create such an assignment by a clear agreement or understanding, oral or otherwise, in addition to the giving of the check that such shall be the effect of the transaction. Fourth Street National Bank v. Yardley, 165 U. S. 634; Throop Grain Cleaner Co. v. Smith, 110 N. Y. 83, 88.

326. Recovery of forged check. No bank shall be liable to a depositor for the payment by it of a forged or

*The section-head is inaccurate, since the section expressly declares that a check is not an assignment. The reading should be, "Check not an assignment - When bank liable."

raised check, unless within one year after the return to the depositor of the voucher of such payment, such depositor shall notify the bank that the check so paid was forged or raised (a).

(a) This section was added by Laws of New York, 1904, ch. 287. It does not seem to be germane to the Negotiable Instruments Law, and would more properly have been enacted as an amendment to the Banking Law. If the statute is to be amended by adding provisions outside of its proper scope, it will soon become such a piece of patchwork, that there will be a demand for its repeal.