(1) The matters and things mentioned in subdivisions one, two and three of the next preceding section; and (2) That the instrument is at the time of his indorsement valid and subsisting. And, in addition, he engages that on due presentment, it shall be accepted or paid, or both, as the case may be, according to its tenor, and that if it be dishonored, and the necessary proceedings on dishonor be duly taken, he will pay the amount thereof to the holder, or to any subsequent indorser who may be compelled to pay it. § 1163. Liabilities of various indorsers. Section 67. [LIABILITY OF INDORSER WHERE PAPER NEGOTIABLE BY DELIVERY.] Where a person places his indorsement on an instrument negotiable by delivery he incurs all the liabilities of an indorser. Section 68. [ORDER IN WHICH INDORSERS ARE LIABLE.] As respects one another indorsers are liable prima facie in the order in which they indorse; but evidence is admissible to show that as between or among themselves they have agreed otherwise. Joint payees or joint indorsees who indorse are deemed to indorse jointly and severally."1 71 Section 69. [LIABILITY OF AN AGENT OR BROKER.] Where a broker or other agent negotiates an instrument without indorsement he incurs all the liabilities prescribed by section sixty-five of this act, unless he discloses the name of his principal, and the fact that he is acting only as agent.72 § 1164. When presentment is necessary. ARTICLE VI PRESENTMENT FOR PAYMENT Section 70.-[EFFECT OF WANT OF DEMAND ON PRINCIPAL DEBTOR.] Presentment for payment is not necessary in order to charge the person primarily liable on 71 See supra, § 644, infra, § 1282. Gallaudet, 120 N. Y. 298, 24 N. E. 994, and supra, §§ 284, 285. the instrument; but if the instrument is, by its terms, payable at a special place, and he is able and willing to pay it there at maturity, such ability and willingness are equivalent to a tender of payment upon his part. But except as herein otherwise provided, presentment for payment is necessary in order to charge the drawer and indorsers.73 Logically where the promise is to pay at a particular place, presentment at maturity at that place should be a condition precedent to the liability of even a primary party and such is the English rule as to promissory notes 74 and, until changed by statute, likewise in regard to acceptances.75 But in the United States the previously existing law is accurately stated in this section of the Negotiable Instruments Law.76 A demand note literally is conditional upon demand, but the peculiar rule of the common law in regard to conditions of demand" has led to the result that a note payable on demand is, so far as the maker's liability is concerned, payable without a demand.78 Certificates of Deposit, however, have generally been held prior to the Act conditional on presentment.79 The effect of failure to make due presentment in discharging drawers and indorsers is familiar and universal law. Less generally had in mind is the effect of such laches in discharging a debt for which the instrument was given.80 73 In the Illinois Act after the word "instrument" are inserted the words: "except in the case of bank notes." In the Kansas, New York and Ohio Acts after the word "maturity" are inserted the words: "and has funds there available for that purpose." In the Wisconsin Act all of the first sentence after the words "on the instrument" is omitted. 742 Ames Bills and Notes, 792, 793; Bills of Exchange Act, §§ 52 (1) (2); 87 (1). 75 Ibid. 76 Cox v. National Bank, 100 U. S. 704, 713, 25 L. Ed. 739; Parker v. 77 See infra, § 1289. 79 See the comment on this section of the statute in Brannan, Neg. Inst. Law (3d ed.), 430, 524, and infra, § 2039. 80 See infra, § 1922a. § 1165. Day for presentment. Section 71. [PRESENTMENT WHERE INSTRUMENT IS NOT PAYABLE ON DEMAND AND WHERE PAYABLE ON DEMAND.] 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 reasonable 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.31 A distinction formerly made in some cases between interestbearing instruments and those not bearing interest, is under the statute no longer valid as matter of law, though the character of the instrument may affect the question of what is a reasonable time.82 A check need not be forwarded by the most expeditious route, necessarily. It may be sent through various banks in accordance with mercantile custom.83 The last sentence of this section seems to change the law for the worse; the change was doubtless unintentional and due to an effort to condense the language of the English Bills of Exchange Act.84 Under the words as they stand, it is plainly stated that an indorser of a bill payable on demand will not be discharged however long presentment to the drawer may be delayed, if the bill is indorsed for the last time within a reasonable time prior to presentment.85 However unreason 81 In the Nebraska Act all of the section after the words "reasonable time after its issue" is omitted. In the Vermont Act instead of the last five words of the section are substituted: "after its issue in order to charge the drawer." 82 See Anderson v. First Nat. Bank, 144 Iowa, 251, 122 N. W. 918; Schlesinger v. Schultz, 110 N. Y. App. D. 356, 96 N. Y. S. 383. 83 Sublette Exchange Bank v. Fitzgerald, 168 Ill. App. 240; Plover Sav. Bank v. Moodie, 135 Iowa, 685, 110 N. W. 29, 113 N. W. 476. 84 The English Act provides "Where it is payable on demand, presentment must be made within a reasonable time after its indorsement in order to charge the indorser, and in case of a bill of exchange presentment for payment must be made within a reasonable time after its issue in order to charge the drawer." 85 This construction was laid down in Columbian Banking Co. v. Bowen, 134 Wis. 218, 114 N. W. 451. See also Plover Sav. Bank v. Moodie, 135 Ia. 685, 110 N. W. 29, 113 N. W. 476; Singer Mfg. Co. v. Summers, 143 N. C. 102, 55 S. E. 522. able the delay may have been, therefore, a further negotiation of the bill and prompt presentment thereafter, it seems, will cure the delay. It should be observed, however, that section 53 states that where an instrument payable on demand is negotiated an unreasonable time after its issue, the purchaser is not a holder in due course. Section 186 lays down a rule as to charging drawers of checks which differs from that of the present section,86 but section 71 governs the charging of indorsers of checks. § 1166. General requisites of presentment. Section 72. [WHAT CONSTITUTES A SUFFICIENT PRESENTMENT.] Presentment for payment, to be sufficient, must be made: (1) By the holder, or by some person authorized to receive payment on his behalf; (2) At a reasonable hour on a business day; (3) At a proper place as herein defined; (4) To the person primarily liable on the instrument or if he is absent or inaccessible, to any person found at the place where the presentment is made.87 Section 73. [PLACE OF PRESENTMENT.] Presentment for payment is made at the proper place: (1) Where a place of payment is specified in the instrument and it is there presented; (2) Where no place of payment is specified, but the address of the person to make payment is given in the instrument and it is there presented; (3) Where no place of payment is specified and no address is given and the instrument is presented at the usual place of business or residence of the person to make payment; (4) In any other case if presented to the person to make payment wherever he can be found, or if presented at his last known place of business or residence.88 See infra, § 1209. See Fowler Paper Co. v. BestJones &c. Co., 183 Ill. App. 310; Columbia-Knickerbocker Trust Co. v. Miller, 156 N. Y. App. D. 810, 142 N. Y. S. 440, 215 N. Y. 191, 109 N. F. 179, Ann. Cas. 1917 A. 348; Columbian Banking Co. v. Bowen, 134 Wis. 218, 114 N. W. 451. 88 See Ryan v. State, 60 Fla. 25, 53 S. E. 448; Finch v. Calkins, 183 Mich. 298, 149 N. W. 1037; Schlesinger v. Schultz, Section 74. [INSTRUMENT MUST BE EXHIBITED.] The instrument must be exhibited to the person from whom payment is demanded, and when it is paid must be delivered up to the party paying it.89 90 It is insufficient to call the maker over the telephone, and, though if a holder with the instrument in his possession is personally present before the maker and demands payment which is refused, the actual exhibition of the instrument if not demanded is waived.91 This is not true where the holder is talking from a distance over the telephone, even though he has the instrument in his possession.92 § 1167. Presentment in special cases. Section 75. [PRESENTMENT WHERE INSTRUMENT PAYABLE AT BANK.] Where the instrument is payable at a bank, presentment for payment must be made during banking hours, unless the person to make payment has no funds there to meet at it any time during the day, in which case presentment at any hour before the bank is closed on that day is sufficient.93 Section 76. [PRESENTMENT WHERE PRINCIPAL DEBTOR IS DEAD.] Where a person primarily liable on the instrument is dead, and no place of payment is specified, presentment for payment must be made to his per 110 N. Y. App. D. 356, 96 N. Y. S. 383; Baer v. Hoffman, 150 N. Y. App. D. 473, 135 N. Y. S. 28; Meyers Co. v. Battle, 170 N. C. 168, 86 S. E. 1034; Nelson v. Grondahl, 13 N. Dak. 363, 100 N. W. 1093; Norwood Nat. Bank v. Piedmont &c. Co., 106 S. Car. 472, 91 S. E. 866. 89 Congress Brewing Co. v. Habenicht, 83 N. Y. App. D. 141, 82 N. Y. S. 481; State of New York v. Kennedy, 145 N. Y. App. D. 669, 130 N. Y. S. 412. 90 Gilpin v. Savage, 201 N. Y. 167, 94 N. E. 656, 34 L. R. A. (N. S.) 417, Ann. Cas. 1912 A. 861. 91 Lockwood v. Crawford, 18 Conn. 361; King v. Crowell, 61 Me. 244, 14 Am. Rep. 560; Waring v. Betts, 90 92 Gilpin v. Savage, 201 N. Y. 167, 94 N. E. 656, 34 L. R. A. (N. S.) 417, Ann. Cas. 1912 A. 861. 93 The Nebraska Act ends with the words "banking hours." See Archerleta v. Johnston, 53 Colo. 393, 127 Pac. 134; Columbia-Knickerbocker Trust Co. v. Miller, 156 N. Y. App. D. 810, 142 N. Y. S. 440, 215 N. Y. 191, 109 N. E. 179, Ann Cas. 1917 A. 348; Neckell v. Bradshaw (Oreg), 183 Pac. 12; Columbian Banking Co. v. Bowen, 134 Wis. 218, 114 N. W. 451. |