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respect to such instruments, and the facts of the particular case. We have already made use of this section in another connection. We had a similar problem raised in regard to the time within which a holder must have acquired the demand note in order to be a holder in due course, and we found that it was possible for him to purchase several months after issue and be a holder in due course; that is, he would be in such a position that he could hold the maker free from all personal defenses. But that question must not be confused with the present question. There the holder was seeking to obtain certain rights against the maker; here the holder has already abandoned his rights against the maker and is seeking to hold indorsers. Is the period of time any different? If a person bought a demand note six months after issue and if at that time he made due presentment and gave due notice of dishonor, would he be able to hold indorsers in the event that his judgment against the maker proved fruitless? Probably so. The courts seem to treat these two periods of time in the same way. Generally speaking, if a holder acquired title of a demand note within such time from date of issue that he would be a holder in due course, if he then makes due presentment and gives due notice of dishonor he would be able to hold indorsers. However, it should be noted that the two questions are essentially different; and it is altogether possible that the usage of trade or the facts of the particular case or both may indicate one period of time within which one must purchase in order to be a holder in due course, and a different period of time within which a due presentment must be made upon the maker in order to preserve the liability of indorsers. Important evidence bearing on the question what constitutes "reasonable time" will be the banking custom in the community. It has even been held that evidence that the banks held paper for more than a year before presenting was admissible on the issue of reasonable time.

SECTION 3.-TIME OF PRESENTMENT FOR PAYMENT OF DEMAND BILLS OF EXCHANGE, IN ORDER TO CHARGE THE DRAWER AND INDORSERS, DRAWERS OF CHECKS EXCEPTED

On a negotiable note, only the indorsers are under a conditional liability. On a bill of exchange, there are two classes of secondary parties-the drawer and the general indorsers. Therefore, in this section, our question is: Within what period of time, and from what fixed event, must a demand bill of exchange be presented to the drawee, or acceptor, in order to preserve the liability of the drawer and the indorsers to the holder?

N. I. L. Section 71. Where the instrument is not payable on demand, presentment must be made on the day it falls due. Where it is payable on demand, presentment must be made within a rea

sonable time after its issue, except that in the case of a bill of exchange, presentment for payment will be sufficient if made within a reasonable time after the last negotiation thereof.

It appears, therefore, that, in order for the holder of a sight bill of exchange to preserve the liability of the drawer and of the indorsers, the holder must present the instrument for payment to the drawee, within a reasonable time from the last negotiation. The period begins to run from the act of the last negotiation and not from the date of issue, as is the case of demand notes. It makes this striking difference: That, in the case of a note, the liability of indorsers cannot be preserved for more than a few months, possibly a year, but usually the liability of indorsers will cease to exist unless presentment for payment has been made upon the maker within a period less than a year from the date of issue of the note. But in case of a bill of exchange the liability of the drawer and of the unqualified indorsers thereon may be preserved for the full period allowed by the statute of limitations. The statute of limitations will begin to run from the date on which each first assumed liability on the instrument. This period varies in the several states. We have yet to consider how many days, weeks, or months may elapse after the date of the last negotiation before the reasonable time expires; but, assuming that the present holder presents the instrument upon the drawee within a reasonable time after the last negotiation, it is possible that the date of this last negotiation may have been many years after the issue of the bill. It is then necessary only that presentment must have been made within such time that actions may be commenced against the drawer and indorsers within the period allowed by the statute of limitations.

How many days, weeks or months, after the last negotiation, may elapse before the reasonable time expires? It will be a relatively short period, measured in days, possibly weeks, in some cases, but not in months. The period will be shorter than is allowed a holder of a demand note where he may have from one month, to a year or perhaps a few months in addition. A reasonable time from the last negotiation should be not more than a few weeks. However, from a practical standpoint, delay will not materially affect the holder, for, so long as he is within the period prescribed by the statute of limitations, he may negotiate the instrument to another party. What formerly was the last negotiation has now been superseded by another negotiation, which is now the last one. On this point it is possible for the courts to hold that a negotiation made for the sole purpose of reviving the liability of the drawer and indorsers constitutes fraud and that therefore the negotiation would fail to have the effect of reviving liability of the drawer and indorsers. This point has not been decided.

The section which we are now considering changed the law from what it was before the act. Before the act, the liability of the

drawer could be preserved only for a reasonable time after he issued the bill. Each indorser was held liable for an equal, but not the same, period of time. Each indorser would be liable for a reasonable time, which period of time began to run from the date on which his liability first arose. Accordingly the liability of the. drawer would first expire, then that of the first indorser and so on. But under section 71 of the Negotiable Instruments Law, the liability of the drawer and of all indorsers may be continued simultaneously for the full period of limitations. Of course, this change in the law is greatly to the advantage of the holder; but, as soon as the holder ceases to be such and becomes an indorser, it works against him. He then has outstanding a conditional liability which will not die for the full period of limitation, five, ten or fifteen years, as the case may be. It has been vigorously argued that to compel an indorser to keep account on his books of all outstanding conditional liabilities on bills of exchange which passed through his hands for so long a time is unjust. So far, the section has not caused wide dissatisfaction, for the reason perhaps that for purely business reasons demand bills of exchange are forced through to an early presentment, and payment, or in the event of dishonor, to an early suit against secondary parties.

COLUMBIAN BANKING CO. v. BOWEN.

(Supreme Court of Wisconsin, 1908. 134 Wis. 218, 114 N. W. 451.) Action by the Columbian Banking Company against John Bowen. From a judgment for plaintiff, defendant appeals.

June 10, 1903, the banking firm known as the Farmers' & Merchants' Bank, of Bangor, Wis., sold to the defendant a $400 draft, drawn in the usual form, dated on that day, payable to defendant's order, and drawn by such firm on the National Bank of North America. at Chicago, Ill. The draft was sent to the defendant at Barron, Wis., and was indorsed by him to A. R. Tabbert, to whom it was forwarded by mail, at Spokane, Wash., June 16, 1903, and was there received by him June 20th thereafter. He was at Spokane temporarily and was on his way to the city of San Francisco, Cal. July 14, 1903, he indorsed the draft and sold the same to the plaintiff at such city, receiving $400 therefor. On that day, in due course, plaintiff sent the draft by mail to the Bankers' National Bank, of Chicago, Ill., by which it was received July 18th thereafter, and was then, as requested, duly presented to the drawee for payment, which was refused, whereupon it was duly protested for nonpayment by a duly authorized notary public, who forwarded a manifest thereof with notices of protest for A. R. Tabbert, the plaintiff and the defendant, to the plaintiff at San Francisco, Cal., and also sent due notice to the National Bank of North America at Chicago, Ill., and to the drawer at Bangor, Wis., July 19, 1903. Plaintiff upon receipt of the manifest and notices duly sent the one for defendant to him at Barron, Wis., by whom it was duly received, and sent the one for Tabbert by mail to his post-office address and reputed place of residence, that being San Francisco, Cal. Thereafter due demand was made on defendant for payment of the draft,

and the same was refused. July 28, 1903, the property of the drawer was placed in the possession of a receiver, who duly paid upon the draft $144. 49, January 6, 1904, $61. 93, May 20th thereafter, and $30.96, June 5th following. Plaintiff was the owner of the draft at the time of the commencement of the action, and at the time of the trial thereof there was due thereon $210.

The pleadings presented issues for decision involving facts as above detailed. The case was tried by the court resulting in findings of fact in accordance with the statement, and a conclusion of law that plaintiff became the owner of the draft in due course, and was entitled to judgment for $210, with costs. Judgment was accordingly rendered.

MARSHALL, J. (after stating the facts as above). Counsel for appellant have presented quite an extended argument, referring to many authorities, as to the law antedating and independently of the negotiable instrument statute * * * to support the proposition, that appellant was released from liability on the instrument in question, because of the period intervening between his parting therewith and the presentation thereof to the drawee for payment. Such statute was enacted for the purpose of furnishing, in itself, a certain guide for the determination of all questions covered thereby relating to commercial paper, and, therefore, so far as it speaks without ambiguity as to any such question, reference to case law as it existed prior to the enactment is unnecessary and is liable to be misleading.

The negotiable instrument law is not merely a legislative codification of judicial rules previously existing in this state making that written law, which was before unwritten. It is, so far as it goes, an incorporation into written law of the common law of the state, so to speak, the law merchant generally as recognized here, with such changes or modifications and additions as to make a system harmonizing, so far as practicable, with that prevailing in other states. That it contains some quite material changes in previous rules governing commercial paper we have had occasion heretofore to point out.

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The primary question discussed by appellant's counsel, it is believed is fully covered by the negotiable instrument law. There are a multitude of decisions regarding the character of a bill of exchange and that of a check, as those terms are used in business transactions, and to what extent the incidents of one are identical with those of the other, which decisions are so variant in their phrasing of the matter as to produce more or less confusion in respect thereto with many apparent, and some real, conflicts, to remedy which was one of the principal objects of the law. To that end it was provided. * in section 185, "A check is a bill of exchange drawn on a bank, payable on demand."

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As to whether the incidents of the species of bills of exchange last mentioned are the same as those of bills of exchange generally, it was further provided in the section last referred to, "Except as herein otherwise provided, the provisions of this act applicable to a bill of exchange payable on demand apply to a check." The only exception referred to material to this case is contained in section 186, in these words: "A check must be presented for payment within a reasonable time after its issue or the drawer will be discharged from liability thereon to the extent of the loss caused by the delay."

Keeping in mind that the discharge from liability above referred to because of unreasonable delay after the issuance of a check in present

ing it for payment, is of the drawer only, and that this action is against the payee who indorsed the instrument in question without qualification and put it in circulation, we turn to section 71, which provides, as to a bill of exchange payable on demand, which from the foregoing obviously includes a check or draft on a bank of the character of the one in question, "presentment for payment will be sufficient if made within a reasonable time after the last negotiation thereof." From the foregoing it seems plain that as regards the payee of such an instrument as we have here, who puts the same in circulation with his unqualified indorsement thereon, and all subsequent parties thereto so indorsing the same, presentment for payment is sufficient, as regards their liability, if made within a reasonable time after the last negotiation. A bill of exchange payable on demand, regardless of its character, put in circulation, so long as its circulating character is preserved may be outstanding without impairing the liability of indorsers thereof. Formerly the length of time within which a bill of exchange might circulate without impairing such liability was more or less uncertain, rendering it very difficult to determine any one case by the decision in another. That difficulty was removed, so far as practicable, by the provision that only the time need be considered intervening between the last negotiation and the presentment. That is recognized as a radical change in the law as it formerly existed.

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As to an ordinary bill of exchange put in circulation, it was quite anciently held that the period between July 18th of one year and January 16th of the next year was not necessarily unreasonable. * * *Perhaps one might now keep a bill of exchange for such length of time as to destroy its circulating character notwithstanding he ultimately passed it along to another person, but that situation, as we view the case, does not exist here.

Applying the law as aforesaid to the facts of this case it is readily seen that the delay in presenting the paper for payment between its date and the negotiation to the bank at San Francisco is immaterial. Appellant unqualifiedly indorsed the paper and put it in circulation by sending it to Tabbert at a distant part of the country, probably knowing that he was a traveler. Tabbert received the paper while journeying with the intention of going to San Francisco and held it till he arrived there and then negotiated it. It was promptly presented for payment thereafter and so in time, as regards that circumstance, to preserve the liability of appellant.

The court decided, as indicated, that Tabbert was a traveler with San Francisco as his destination and properly held that such circumstance sufficiently explained, if any explanation were necessary, the lapse of time between his reception of the paper and his negotiation thereof, preserving its circulating character and warranting the finding that the respondent came thereby in due course.

The point is made that the instrument was not presented to the drawee for payment during banking hours. The negotiable instrument law at section 72 provides that "Presentment for payment to be sufficient, must be made: * * * at a reasonable hour on a business day. The evidence shows that the paper, after taking its course through the clearing house, was presented to the drawee for payment on the afternoon of the same day between the hours of 3 and 6 o'clock. The proof is to the effect that such was the customary

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