is protested for nonacceptance, and taken up by an indorser, he cannot recover damages against the drawer, unless he is himself liable for them.48 482 And, if it is taken up by the indorser's agent, he cannot recover the statutory damages against his principal. 483 So, where a foreign bill is transmitted to a correspondent abroad for collection, the correspondent cannot recover damages against his principal, although the principal is indebted to him and bankrupt.484 But one who takes up a bill for the drawer's honor is entitled to recover statutory damages against him.485 This does not apply, however, to one who holds a bill merely as collateral for other security of a higher character, such as a bottomry bond.480

Party Liable for Damages.

§ 1722. The government is liable for statutory damages as the drawer of a foreign bill.487

But an acceptor is liable, in general, only for interest and costs, and not for damages.488 Where, however, the drawer is obliged to on other of the United States, 3 per cent.; and, on foreign countries, 15 or 20 per cent., according to locality, besides charges of protest, in lieu of interest and other charges (Code, §§ 3512, 3513). TEXAS: On protested bills drawn by a merchant of Texas on his agent living outside of Texas, 10 per cent., with interest (Rev. St. art. 317). VIRGINIA and WEST VIRGINIA: On bills drawn on any other of the United States, 3 per cent.; and, on any place without the United States, 10 per cent. "in addition to what else he is liable for" (Virginia Code, § 2851; West Virginia Code, c. 99, § 9). WISCONSIN: 5 per cent. on protested bills payable out of the United States, besides reexchange (Sanb. & B. Ann. St. § 1682); and 5 per cent. on bills drawn on any other of the United States, with the costs and charges of protest (Id. § 1683). 482 Kingston v. Wilson, 4 Wash. C. C. 310, Fed. Cas. No. 7,823.

483 Thompson v. Robertson, 4 Johns. 27; Kenworthy v. Hopkins, 1 Johns. Cas. (N. Y.) 107.

484 Hambro v. Casey, 110 U. S. 216, 3 Sup. Ct. 583.

485 Pratalongo v. Larco, 47 Cal. 378. But payment by the drawer for the honor of the drawee will not render the latter liable for damage, other than the actual damages sustained by the drawer. City Bank v. Girard Bank, 10 La. 562.

486 Hazelhurst v. Kean, 4 Yeates (Pa.) 19.

But a draft by one government

487 United States Bank v. U. S., 2 How. 711. on another is not a bill of exchange, or within the terms of the Maryland statute as to protest and damages. U. S. v. Bank of U. S., 5 How. 382.

488 Bowen v. Stoddard, 10 Metc. (Mass.) 375; Manning v. Kohn, 44 Ala. 343;

pay a bill with statutory damages, he may prove against the acceptor's estate in bankruptcy for the whole amount paid.489 Where an indorser sues the acceptor of a bill, he cannot recover the damages incurred by him at suit of his indorsee without a count in his declaration for money paid.190 But, if a principal orders his agent to purchase goods and draw on him for the price, he will be liable on dishonor of the bill for damages under the common counts.** 491

Where one promises to accept a bill for the drawer's accommodation, he will be liable to him for damages, but only to the extent of the inconvenience and loss suffered, and not for the face of the bill.495 A bank is liable to its customer for failure to pay a check drawn upon it within a reasonable time after receiving funds, without proof of actual damage sustained by the drawer.493 And substantial damages are recoverable in such case, although, as we have seen, the payee cannot recover against the drawee upon such check, and is not entitled to damages for its nonpayment.

494

Damages-When Recoverable.

§ 1723. The drawer of an interstate bill is, in general, liable for statutory damages. 495 So, where a bill is drawn in Ohio on a firm residing in Ohio and Louisiana, but is addressed to, and accepted as payable in, Louisiana, the drawer will be liable for damages as on

Trammell v. Hudmon, 56 Ala. 235; Hanrick v. Bank, 8 Port. under the statute of another state where the bill was drawn. 10 Metc. (Mass.) 597.

489 Francis v. Rucker, Amb. 672.

(Ala.) 539. Nor Fiske v. Foster,

490 King v. Phillips, Pet. C. C'. 350, Fed. Cas. No. 7,802. But the damages need not be specially demanded in the declaration.

McGarr v. Lloyd, 3 Pa. St.

474.

491 Riggs v. Lindsay, 7 Cranch, 500.

492 Ilsley v. Jones, 12 Gray (Mass.) 260.

493 Marzetti v. Williams, 1 Barn. & Adol. 415.

494 Rolin v. Steward, 14 C. B. 595.

495 May v. Bank, 9 Ind. 233; State Bank v. Bowers, 8 Blackf. (Ind.) 73. But not where it is only held as an additional security. Hazelhurst v. Kean, 4 Yeates (Pa.) 19. And this was so under the former Kentucky statute. Wood v. Bank, 7 T. B. Mon. (Ky.) 281, although not by the present act. But such damages once paid by mistake of law cannot be recovered or set off. Bank of U. S. v. Daniel, 12 Pet. 32.

497

a foreign bill.496 But a distinction is sometimes made between bills drawn on another state and bills payable in such other state, to the effect that no damages can be recovered in the latter case. But this distinction has been denied, and is probably unsound,498 except under the terms of some special statutes. Where a bill drawn and payable in New York is indorsed in Ohio, the indorser will be liable for damages.499 In Missouri, statutory damages are only recoverable on bills which are drawn expressly "for value received"; 500 and the note must not only be negotiable, but must have been nego. tiated. The indorser of a negotiable note, payable in another state, and protested for nonpayment, is liable for damages by the Georgia statute. 502 But, in the absence of a statute, damages are not recoverable on such a note,5 or on a certificate of deposit,504 or a nonnegotiable note." But, where one draws a bill on himself (which is, in effect, a note), it has been held that he is liable for damages on its dishonor.506

301

505

503

Damages on Protest.

§ 1724. The drawer is liable for statutory damages on the protest of a bill for nonacceptance.507 And this is true of inland bills, also, in most of the United States. 508 But if a joint drawer voluntarily and unnecessarily pays damages on protest of the bill for nonaccept

496 West v. Bank, 6 Ohio St. 168.

497 Clay v. Hopkins, 3`A. K. Marsh. (Ky.) 485; Farmers' Bank of Canton v. Brainerd, 8 Ohio 292; Cox v. Bank, 3 Sneed (Tenn.) 140.

498 State Bank of Indiana v. Rodgers, 3 Ind. 53.

499 Case v. Heffner, 10 Ohio, 180.

500 Hallowell v. Page, 24 Mo. 590; Riggs v. City of St. Louis, 7 Mo. 438. 501 Broadway Sav. Bank v. Forbes, 79 Mo. 226, 9 Mo. App. 575; Bank of Missouri v. Wright, 10 Mo. 719. And only by a holder for value, who need not, however, aver himself to be such. Clark v. Schneider, 17 Mo. 295. 502 Howard v. Bank, 3 Ga. 375. 503 Loud v. Merrill, 47 Me. 351. 504 Sawyer v. Page, 24 Mo. 595.

505 Perry v. Smith, 22 Vt. 301. So, a bill payable "in currency." Farwell v. Kennett, 7 Mo. 595.

506 Randolph v. Parish, 9 Port. (Ala.) 76. But see, contra, McCandlish v. Cruger, 2 Bay (S. C.) 377.

GOT Gantt v. Mackenzie, 3 Camp. 51.

508 Evans v. Gee, 11 Pet. 80, on an Alabama bill.

ance, without waiting for protest for nonpayment, he is not entitled to contribution as to such damages against his co-drawer.509

Protest is generally necessary in order to render the drawer liable for the statutory damages. 510 And this is true of interstate bills, although they need not otherwise be protested. 511 If, however, the protest is unavailing and unnecessary, there can be no such damages recovered. 512 On the other hand, the acceptance in Missouri of a bill drawn in another state for "value received" renders the acceptor liable for 10 per cent. damages without protest.513 And, where a foreign bill is protested only as to part of the amount, damages are to be reckoned only on such part.514 In Indiana, where the statute formerly required a preliminary demand of payment, notice of protest given to the drawer was held to be a sufficient demand to render him liable for damages. 515

Waiver of Damages.

§ 1725. Where the holder of a bill receives payment after maturity, although he may afterwards recover interest which has been reserved, he will be held to have waived his statutory damages not then demanded or reserved." 516 So, if the second part of a bill is presented and paid, with interest and protest fees, after dishonor of the first part, it will be a waiver of the damages on the first part.517 And, if a drawer who has become liable for damages is released on giving his check for the amount of the bill, it will be a sufficient consideration for the release; and he can afterwards recover the face of

509 Morris v. Tarin, 1 Dall. 147.

510 Case v. Heffner, 10 Ohio, 180; and must be averred in the declaration, Jordan v. Bell, 8 Port. (Ala.) 53. And see § 1144, supra.

511 McMurchey v. Robinson, 10 Ohio, 496; Wanzer v. Tupper, 8 How. (Miss.) 234.

512 Noyes v. White, 9 Kan. 640. On the other hand, the holder who unnecessarily protests a bill is not in general liable for damages therefor to the drawer, Wittich v. Bank, 20 Fla. 843; or drawee, Bellinger v. Glenn, 80 Ala. 190.

513 Phillips v. Evans, 64 Mo. 17.

514 Laing v. Barclay, 3 Starkie, 38.

515 May v. Bank, 9 Ind. 233.

516 United States v. Gurney, 4 Cranch, 333. But see, contra, as to damages, Kennerly v. Bragg, 1 Mo. App. 574.

517 Page v. Warner, 4 Cal. 395.

the bill against the holder, who collected it from the acceptor, without deduction of the damages for which he was originally liable. 518 So, in Missouri, under the statute which gave damages on promissory notes, if not paid in 20 days after demand and notice, damages cannot be recovered in a suit brought within the 20 days.519

The drawer and indorser of a bill are no longer liable for damages, after the bill has been collected by a levy against the acceptor.520 And in Maine a part payment made by the acceptor is available to reduce the damages chargeable against the indorser.521 But in New York the drawer remains liable for the statutory damages, notwithstanding a part payment made by the foreign acceptor after the bill is dishonored, and wherever such payment may have been made.522

Measure of Damages.

524

523

or of

§ 1726. Irrespective of statutory damages, the face of a bill, including principal and interest due on it, is the measure of the damages recoverable by the holder. Thus, one who purchases at a discount may recover the face of the check from the drawer," the note, from the maker; or prove the note for its full amount against the maker in bankruptcy.525 But, where it is shown that a note was given for indemnity against a contingent loss, the damages recoverable between immediate parties will be limited to the actual amount of such loss.526 So, where a premium note is given to cover risks to be afterwards indorsed on an open insurance policy, the amount due at any time would be represented by the premiums

518 Pesant v. Pickersgill, 56 N. Y. 650.

519 Rev. St. p. 295, § 11; Farrell v. Fritschle, 30 Mo. 190.

520 Warren v. Coombs, 20 Me. 139.

621 Bangor Bank v. Hook, 5 Me. 174.

522 Hargous v. Lahens, 3 Sandf. 213.

523 Murray v. Judah, 6 Cow. (N. Y.) 484; Munn v. Commission Co., 15 Jolins. (N. Y.) 44.

524 Wade v. Railway Co., 149 U. S. 327, 13 Sup. Ct. 892; St. Louis, Ft. S. & W. R. Co. v. Chenault, 36 Kan. 51, 12 Pac. 303; Petri v. Bank, 83 Tex. 424, 18 S. W. 752; Id., 84 Tex. 212, 20 S. W. 777. And see § 448, supra.

525 Ex parte Lee, 1 P. Wms, 782.

526 Rogers v. Smith, 47 N. Y. 324; Colman v. Post, 10 Mich. 422. Puterbaugh v. Hammond, 106 Ill. 257.

RAND.C.P.-154

And see

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