
    JOSIAH W. DEENER vs. WILSON E. BROWN AND JEROME BROWNE, Jr.
    At Law.
    No. 9225.
    
    
      W. made his hank-check for the accommodation of B., who transferred it to D. The latter did not present it for payment at the hank for upward of five months. For three or four months after the date of the check, B. was in solvent circumstances and the money could have been collected out of him, hut subsequently he became insolvent, and so continued to the time of the trial. Immediately before the check was presented, W. directed the hank not to pay it: Held—
    I. That the drawer of a check appropriates the amount it calls for out of the deposit to his credit in the hank at the time of its date, and he has no right to withdraw it afterward.
    II. If the holder of a check delays in presenting it, and in the mean time the hank fail, the loss will he his and not that of the drawer.
    III. That the check was an accommodation-cheek loaned by ~W. to B., canuot exonerate him from liability, for he occupies the ground of the maker of commercial paper.
    STATEMENT OF THE CASE.
    Action on tbe following check:
    "‘No. 40.] “Washington, D. C., July 24,1871.
    National Metropolitan Bank, pay to J. Browne, jr., or bearer, one bundred dollars, ($100.)
    W. E. BEOWN.”
    [Eevenne-stamp, 2 cents.]
    (Indorsed:) “ J. Browne, jr., J. W. Deener.”
    On tbe — day of November, A. D. 1873, tbe above cause being called for trial, tbe same was submitted to tbe court to bear tbe evidence and determine tbe cause, whereupon tbe plaintiff proved tbe following facts :
    1. Tbe signature of Wilson E. Brown on said cbeck to be tbe genuine signature of said defendant Wilson E. Brown. That said cheek was drawn in favor of Jerome Browne, jr.; that tbe signature on back of said cbeck is the genuine signature of said defendant, Jerome Browne, jr.; and that said check was presented for payment at said National Metropolitan Bank on the 4th day of January, 1872, between the hours of 1 and 2 o’clock p. m., and during the business hours of said bank; and that payment thereof was refused by said bank. That said plaintiff received said check from said defendant Jerome Browne, jr., for valuable consideration, on the 26th day of July, 1871. And that said x>laintrff presented said check at said bank for payment on the 4th day of January, 1872, and payment was refused by said bank. That said defendant Wilson E. Brown instructed said bank about the time said cheek was presented for payment not to pay said check. And that said defendant Wilson E. Brown had no funds in said bank with which to pay said check at the time it was presented for payment. That soon after said cheek was transferred to plaintiff he laid it away and forgot all about it, until, looking over his x>apers afterward, he accidentally found it, and immediately afterward presented it to said bank. That said National Metropolitan Bank at the date of said check was solvent, and continued to be solvent from the date of said check to the time of x>resentatiou of said check for payment, and continued solvent to date of trial of said cause, and was then solvent $ and said plaintiff then offered and read in evidence said check. And that x>laintiff was the present owner and holder. And then said plaintiff rested his case.
    The defendant Wilson E. Brown, to maintain the issue on his part, offered and proved in evidence the following facts, subject to the excex>tious hereinafter mentioned.
    That said plaintiff presented said check for payment at said bank on the 4th day of January, 1872, and never before that time x>resented said cheek at said bank for payment.
    That said check was an accommodation-check for ten days 5 that for three or four months from date of said check, said defendant Jerome Browne, jr., was solvent, and that the money could have been made out of him. And that in the month of November preceding the presentation of said check said defendant Jerome Browne, jr., was insolvent, and remained so up to the time of trial; that after the date of said cheek, and ux> to the date of November, said defendant Jerome Browne, jr., carried on business and paid many notes. And if said check had been presented at any time before said date it was presented it would have been paid, as it was for a small amount. And that the said Wilson B. Brown had been a good customer at the bank.
    To the admissibility of each and every part of said evidence, at the time each and every part was offered, said plaintiff, by his counsel, objected. And yet the court overruled each and every objection, and admitted and heard each and every part of said evidence. And plaintiff, by his counsel, then and there excepted to each ruling. Whereupon said defendant Wilson E. Brown rested his case.
    No evidence was offered on the part of said defendant Jerome Browne, jr.
    Judgment was rendered by the court for defendant.
    
      William J. Miller for plaintiff:
    The plaintiff contends that the court erred in its findings, decision, and judgment upon the facts presented in this case, because, even admit for the sake of the argument (but which we do not admit) that the foregoing evidence on the part of the defense was admissible, yet there was no evidence to show that the defendant Wilson E. Brown (the drawer of the check) was injured by the non-presentation. On the coptrary, it appears from the evidence that the National Metropolitan Bank, on which the check was drawn, was solvent at the date of the check, and from that time continued to be and was solvent at time of presentation of check for payment, and at time of the trial of the cause; and that the defendant Wilson E. Brown, drawer of the check, had no funds in the bank. Hence we claim that a valuable consideration having been given for the check, and Wilson E. Brown, drawer of said check, was not injured or damaged by the non-presentation of the check for payment before the 4th day of January, 1872, and as the bank was solvent on the day it was presented, and defendant Wilson E. Brown had no funds in said bank with which to pay said check, judgment should have been given for the plaintiff. In matter of Ephraim Brown, 2d Story, 502-511; Conroy vs. Warren, 
      3 Johnson’s Cases, 259; 4 Kent’s Comm., 4th ed., p. 549, note*; Little vs. Phoenix Bank, 2 Hill, N. Y. R., 425; Robinson vs. Hawkesford, 9 Queen’s Bench, 52; Mullock vs. Radakisen, 28 Eng. Law and Equity R., 94.
    
      John E. Norris for defendant W. E. Brown:
    There was no legal or sufficient demand of payment of the check, and no legal or sufficient notice, both of which are required. Laches on the part of the plaintiff takes away his right to relief. 1 Parsons on Notes and Bills, p. 355, and Cruger vs. Armstrong, &c., 3 Johnson’s Cases, 5, citing 2 Robinson, 173.
    The plaintiff was bound to due diligence in presenting the check for payment. American Law Register, New Series, vol. ix, 320.
    Checks drawn in the ordinary general form, not describing any particular fund, do not amount to an assignment of the funds of the drawer in the bank. Am. Law Reg., vol. vii, 376-7.
    The same rules apply to checks as to notes and other negotiable paper and securities, that the holder must use diligence in collecting, especially if the condition of the parties has been changed so as to prevent the guarantor from re-imbursing himself. 1 Parsons on Bills and Notes, 355.
   Mr. Justice Wylie

delivered the opinion of the court:

This is an action by the holder of a check against the drawer, Wilson E. Brown, and the indorser, Jerome Browne, jr., united as defendants, as permitted by our laws. The check is dated 24th July, 1871, is drawn for $100, and payable to Jerome Browne or bearer. It was passed to the plaintiff in course of business, for value, and without notice that, as between the drawer and payee, it was for the accommodation of the latter. It was held by the plaintiff, without presentation at the bank, till the 4th of January, 1872 — a period of five months and twenty days. It was then presented for payment, but the drawer had no funds in the bank to meet it, and payment was refused. The payee, Jerome Browne, makes no defense; but the drawer, Wilson E. Brown, claims that the check in question was drawn for accommodation of the payee, and that he was discharged from his original liability in consequence of the holder’s delay in presenting the note for payment. At the trial in the circuit court the following evidence was offered by the defense, and allowed to go to the jury:

3. Evidence that the check was not presented for payment till the 4th of January, 1872.

2. That the check was an accommodation-check, loaned by the drawer to Jerome Browne, jr., for ten days.

3. Evidence that for three or four months after the date of the check Jerome Browne, jr., was in solvent circumstances, and that the money could have been collected from him'; but that subsequently to November, 1871, he was insolvent and continued so to the date of the trial.

To the admission of this evidence plaintiff objected, and excepted to the rulings of the court allowing it to be given to the jury.

No evidence was given or offered to show that the holder of the check was other than a bona-fide holder for value, and without notice of its accommodation character at the time it was assigned to him by Jerome Browne, jr. He must therefore be regarded as being the holder of a check purchased in the course of business, bona fide, for value, and without notice of any defense against it on the part of its drawer. Its accommodation character as between the drawer and the payee is, therefore, not an element belonging to the case which we are to consider. As against a holder of this character, the maker of accommodation-paper occupies no other ground than the maker of regular commercial paper.

The evidence admitted on this point, therefore, we think ought to have been excluded.

For the same reason we think the evidence tending to show that the indorser was solvent for four months after the date of the check, and after that up to the period when it was presented for payment, and even to the date of the trial, was of no consequence. The holder was not bound to know, nor was he informed, that the check was other than it appeared to be on its face; and there he saw that Wilson E. Brown was the drawer of the check, and the principal in the transaction, and Jerome but an indorser and only contingently liable. Had he released the latter in express terms from all liability to him as such indorser, that would not have impaired his rights as against the drawer of the check.

But it is claimed for the defense that the plaintiff has lost his remedy in consequence of the long delay in presenting the check for payment.

There are three respects at least in which a check differs from a bill of exchange: first, it is always drawn upon a bank or banker, and is payable immediately on presentment, without the days of grace ¡ second, it requires no acceptance apart from the act of payment$ and third, it is always supposed to be drawn on a private deposit of funds, and amounts to an absolute appropriation of so much thereof to the holder of the check, to remain on deposit so appropriated until called for, and cannot be afterwards withdrawn. Ex parte Brown, 2; Story C. C. R., 511 to 518; 3 Kent’s Com., 104, note; Conroy vs. Warren, 3 John’s Cas., 259, &c.; Chitty on Bills, 583.

In Hoyt vs. Seeley, 18 Conn., 353, the holder of the check did not present it to the bank for payment for more than two years, but because the bank was all the time solvent, and the drawer of the check had sustained no loss in consequence of the delay, but had himself withdrawn the funds which otherwise would have been paid upon the check, it was held he was not exonerated from liability.

It is quite true that the rule requiring the prompt presentation of bills of exchange is also the rule as to the presentation of checks upon bankers. But it means no more than this: that if the holder of a check retains it in his possession beyond the time prescribed by the rule, he discharges the indorsers, if there be any, or takes upon himself the risk of the continued solvency of the bank. But the discharge of he indorsers is not a discharge of the drawer of a check, any more than the neglect of the holder of a promissory note to make demand of payment on the last day of grace, and give notice of non-payment to the indorsers in that case, would discharge the maker of the note from liability. He remains liable, although all the other parties may be discharged, because his is the primary and absolute liability, while theirs is but contingent, conditional, and secondary. So when the rule of diligence requires a check, bill, or note to be presented within any certain prescribed period, it is with a view to the liability of the secondary parties alone.

But in addition to what has been said on these questions, the record shows us that the check in the present case was not made payable to the order of Jerome Browne, jr., but to him or bearer. It would have been quite as negotiable without the indorsement of Jerome Browne, jr., as with it. (See Chitty on Bills, 511.) And so the plaintiff seems to have regarded it: for after payment was refused, he took no pains to give notice thereof to the indorser. The holder was at liberty to treat the check as though it needed no indorsement, and contained none. The question is one, therefore, simply between drawer and bearer, and the rule in such case is thus stated by Kent: “As between the drawer of a check and the indorser,it ought to be presented for acceptance.(payment?) with due diligence; but as between the holder and the drawer, a demand at any time before suit brought will be sufficient, unless it appear that the drawer has failed, or the drawer has in some other manner sustained injury by the delay.” 3 Com., 88.

But even if the accommodation character of the paper had been known to the plaintiff, we are not prepared to say that such a circumstance would have affected the result in this case.

In Smith vs. Knox, 3 Esp. R., 46, Lord Eldon said, “ When a bill is given merely for the accommodation of the drawer or payee, and that is sent into the world, it is no answer to an action on that bill that the defendant accepted it for the accommodation of the drawer, and that that fact was known to the holder. In such case, if the holder gave a bona-fide consideration for it, he is entitled to recover the amount, though he had full knowledge of the transaction.”

In Chitty on Bills, 305, it is said that the very object of an accommodation acceptance is to enable the party accommodated to obtain money or credit from a third person, and therefore the want of consideration furnishes no defense to one who lias advanced money on the credit of the acceptor, though he may have been defrauded by the drawer.

In the case under consideration, the drawer of the check had a deposit to his credit at the bank sufficient to pay the check at, and for some time subsequently to, its date. By the check he had appropriated its amount to this holder, and had no right to withdraw it afterward. The delay in presenting the check was at the risk of the holder. If the bank had failed the loss would have been his. But the money so set over was afterward withdrawn by the drawer of the check himself, and thus, afcer having taken the money, he is now attempting to throw the loss on the party whose money he unjustly appropriated.

Judgment reversed and new trial awarded.  