
    Brown vs. Lusk.
    Before a suit can be instituted against the drawer of a bank check, payment thereof must be demanded of the bank.
    Proof by a witness, that he saw the holder of a check go into the bank, and after he came out, said he had demanded payment of the check, is’ inadmissible as evidence to prove the demand.
    Where the drawer of a check is informed that a demand was made, and payment refused, a promise to arrange it is not a waiver of the demand if in fact none were made. ■-
    An instrument of writing was drawn as follows: “No.-Nashville, Dec. 13, 1827. Cashier of the office of discount and depositl, United States Bank, afi Nashville, pay N. Patterson or bearer, one'hundred dollars and-cents, on the 14th January, 1828. 9
    M. W. BROWN.”
    Held, that this was an inland bill of exchange, and as such, was entitled to three days of grace.
    Payment of a bill of exchange must be demam of grace. he last day
    When a bill of exchange is drawn for the- accommodation of the payee, and the drawer has reasonable grounds to believe' that the payer will take it up, he is entitled to demand and notice.
    ■ Brown drew a check in favor of Patterson, one month after date, on the cashier of the office of discount and deposite of the Bank of the'United States, at Nashville. This check was dated December 13, 1827. Patterson, jn whose favor it was drawn, transferred it to the defendant, Lusk, for a valuable consideration. It was proved that on the 24th January, the holder of the check went into the bank, and upon coming out of the Bank, stated to witness that he had presented it for payment, and payment was refused. Brown had not, at the time he drew the check or afterwards, any money or effects in the bank. On the morning of the 24th January, Brown was informed by Lusk, that Patterson had not paid the check, upon which he said it should be arranged. There was no other demand or notice given, nor did it appear from the evidence, whether Lusk knew that it was an
    
      accommodation check. There was a verdict and judg- . . i ■ t t> ment for Lusk, m the circmt court, from which Brown prosecuted, an appeal in the nature of a writ of error to this court.
    
      Fletcher, G. S. Terser and G.M. Fogg, for the plaintiff in error.
    Whether the instrument drawn by the plaintiff in error, be strictly and technically a check, or an inland bill of exchange,'in either event it is contended, Brown is not liable. But, first, we say that a draft or check, drawn upon the cashier of a bank, to be paid at a future day, is an inland bill of exchange. Chittyon Bills, 323: 3 John. Cases, 5: 2 Bibb’s Rep. A check is an order on the-bank, payable on -demand; hence, like an inland bill of exchange payable on demand, which in fact it is, no days -of .grace are allowed, because bills payable on demand or at sight, are not entitled to days of grace. Chitty on Bills, 202. But an inland bill of exchange, payable at a future period, is entitled to grace. Chit.ty on Bills, lb. If then, upon a check or inland bill of exchange, days of grace are allowed, this check or bill should have been demanded on the 27th, instead of the 24th, and Brown, the drawer, notified of its non-payment, which not being done, he is discharged.
    But, supposing that no days of grace are allowed upon this instrument, still Brown is entitled to notice. He was told on the morning of the 24th, that Patterson had not paid it. It had not then been presented' for payment at the bank. The bank did not close until two o’clock, and consequently, it was not payable until that time, and notice before the draft was due, was a nullity.
    But it may be contended, that Brown, not having any funds or effects in bank, could not be injured for want of notice, and that the law is settled, when the drawer has no funds in the hands of the drawee, he is not entitled to have demand made and notice given to him.
    In Bickerdikevs. Bolman, (1 Term Rep. 45,) it was set-tied, that notice is not necessary where the drawer had no effects in the hands of the drawee. This is said to form an exception to the general rule requiring notice. This is true, but the exception is only applicable to a case similarly circumstanced, that is, where the drawer of the bill receives the proceeds himself, when it is drawn for his own benefit. Vide La Fitte vs. Slater, 19 Com. Law Rep. 182.
    In the case before the court, the check was drawn for the accommodation of Patterson. He was the person to provide for its payment; Browp had reasonable grounds to believe that Patterson would place funds in .the bank to meet it; and the rule is well settled, that if the drawer has reasonable grounds to expect the bill will be paid, he is entitled to notice, although he has no effects in the hands of the drawee. Rucker vs. Hillier, 16 East Rep. 43: Chitty on Bills, 178, in notes 199, 200, 201.
    Where notice is necessary, it makes no difference whether actual injury has been sustained or not for the want of it. Chitty on Bills, 198. Nor is it any excuse that the holder did not know it was an accommodation bill; he is bound to give notice; it is a condition prece~ dent to his recovery; he is bound at his peril to know the fact, whether it is an accommodation bill before he refuses to give notice, on the ground, that the drawer had no effects in the drawee’s hands; in fact, he is presumed to know the law, and the law is, that want of effects in the hands of the drawee, only excuses notice, where the bill is drawn for the drawer’s own benefit. He ought to have given notice, or been well assured that the bill was of a kind or description which dispensed with it for want of effects in the hands of the drawee.
    It is conclusively settled that wherever the drawer of a bill has a right of action against the payee, (as must always be the case where it is for the accommodation of the latter,) demand and notice are necessary to charge him, although he has no effects in the drawee’s hands. The same reason which requires it on endorsements, requires it m tins case; for it notice be given of the non-payment, the drawer may find means to secure the debt. 5 Com. Law Rep. 401: 15 Com. Law Rep. 600: 19 Com. Law Rep. 1S1: Chitty on Bills, 201.
    Washington, for defendant in error.
    1. The court did not err in charging the jury, that there was no necessity for a protest of the check; and that Brown was not entitled to notice of non-payment, it appearing that the drawer had no funds in hank, nor authority to draw. Chitty on Bills, 7th Amer. Ed. 323: 3 Burr. 1519: Chitty on Bills, 198, and cases referred to in note y of the page.
    The act of 1762, ch. 9, sec. 4, 5, does not affect the above principle. 1. That act relates to the drawing of orders, regularly so called, as contradistinguished from bank checks. 2. That act relates to orders drawn on a person or persons, not on a corporation. 3. That act only applies to cases, where the money, for which the order is drawn, is actually in the hands of the drawee, and not to cases of orders drawn for the payment of money. 4. Even in cases to which the act does apply, a special plea, insisting upon the matter of the 4th and 5th sections as cause of non-suit, would be necessary.
    2. The court correctly charged the jury, that the instrument so declared on, was a check, and not a bill of exchange; and that therefore, presentment on the 14th of January, was proper, and not three days afterwards. 3 Kent’s Commentaries, 58: 3 Johnson’s Cases, 5, 259.
    The evidence of the fact of presentment is sufficiently proved by tbe testimony of Richmond. That testimony was brought out by the defendant, upon cross-examination. Even if it had been brought out by the plaintiff, it is evidence of a fact tending to prove, the fact of presentment, from which the jury was at liberty to infer, aud from which they did infer, that presentment was made.
    
      3. The court very properly declined to charge the jury as to the properties of an accommodation check, or as to whether the drawer of such a check was entitled to notice of the non-payment, notwithstanding he had no funds in the bank. A court is bound to charge the jury upon every question of law, arising out of the evidence involved in the issue, and material to the determination of the cause; but, not upon any and every question of law, upon which the counsel may think proper to call for a decision.
    In this case there was not a particle of evidence showing, or tending to show, that the check in question was an accommodation check. And even if it were an accommodation check, unless the holder knew it to be such, he would not be bound to give notice, when there were no funds of the drawer in the hands of the drawee, nor authority to draw. Nor would the drawer, when he had no funds, be entitled to notice, whether the check were an accommodation one or not, or whether the holder knew it to be of that kind or not; because, the drawing of a check without funds on which to draw,, is, in contemplation of law, a fraud, which tends to deceive and give a false credit to negotiable instruments; and this tendency is not diminished, so far as regards third persons, whether the check be drawn for the accommodation of the payee, or on account of a consideration received from him. It would be strange, therefore,- if for' not deciding a question, which, if decided, must have been held to be against the plaintiff in error, he could now claim the right of having the judgment reversed. Chitty on Bills, Amer. Ed. 200-1-2.
   Green, J.

delivered the opinion of the court,

This action was brought against the plaintiff in error, by the defendant in error, on the following paper writing:

ctNo.^-, Nashville, December 13th, 1827. Cashier of the office of discount and deposite, United States Bank, Nashville, pay to N. Patterson or bearer, one hundred dollars and-cents, on the 14th January, 1828.
$100 -cents. M. W. BROWN.”

Proof was introduced to show that payment was demanded at the bank on the 14th of January, the day on which on its face, it is made payable. It is not pretended that any demand was made afterwards. It is insisted by the plaintiff, 1. That the paper upon which the suit is founded is a hank check, and that demand on the 14th was proper.

2. That the evidence shows such demand was made.

3. That if it he considered a bill of exchange, still Brown was not entitled to notice, inasmuch as he had no funds in the Bank when he drew, nor until long after the draft became payable.

It may be proper to remark in the first place, that if the paper on which this action is founded were considered a bank check, and therefore payable on the 14th of January, 1828, still in order to sustain the action it must appear that payment was demanded of the Bank before the suit was brought. 3 Kent’s Com. 58. To prove this, Barton Richmond was introduced, who testified that he saw Lusk, the plaintiff, on the 14th of January, going into the Bank, and afterwards met him returning from it, when Lusk told him that, he had demanded payment, which was not made. Witness afterwards saw Brown and told him that payment had been demanded and refused, when Brown said it must he arranged^ The conversation between the witness and Lusk was wholly incompetent, and ought not to have been received. It was merely hearsay testimony, imconnected with any fact by which it could be made admissible. The demand, is the fact to he proved; that, if made at all, was made in Bank, and this conversation occurred with the witness, after Lusk had left the hank, and was returning. It cannot he pre-therefore, that it was part of the res gestad The 'remark ol Brown, that it must be arranged, was no wai-yer of the demand which the law required the plaintiff to make. He was told the demand had been made. He made the remark upon the supposition of a state of facts, which, so far as we are informed, did not exist. It is not like the case where a party making a promise to pay, is a waiver of notice, he being acquainted with all the facts. Here, if the facts stated to him were true, no waiver was necessary: if they were not true, the remark produced by the falsehood is no waiver. In this view of the case, therefore, this judgment cannot be sustained.

But the writing in question is not a bank check, but is a bill of exchange. It was made payable at a day after its date, and was given as a security for money then to be paid. Chitty says, (Chitty on bills, 7th Amer. Ed. 322) that “checks are not due before payment is demanded, in which respect they differ from bills of exchange and promissory notes, payable on a particular day.” This is the distinguishing feature of these instruments. They are appropriations of money in the hands of a banker, and are payable on presentment. The paper under consideration was executed the 13th of December, 1827, and payable the 14th of January following, and was negotiated as a security for money. It differs not, in substance or form, from an inland bill of exchange as defined by Chitty, 41, 47, 92. This being the character of the instrument, it was entitled to grace, and ought to have been presented for payment the 17th of January. The court charged the jury that the paper writing, upon which the action was founded, was a bank check, and not a bill of exchange, and that three days of grace must not be allowed. Upon the view before taken of this case, we are of opinion the court erred in this part of the charge.

The court was requested to charge, that if the jury believed that the writing was executed for the accommodation of Patterson, the defendant was entitled to notice, although he, the defendant, might have had no effects in the hands of the drawer.. This charge, the court refused to ■give. We are not authorized to say that the court erred in refusing to give the charge, in the language proposed; because, that would necessarily be assuming, that the proof had established the fact, that Brown had reasonable grounds to expect that Patterson would provide funds for the payment of the bill, by the time it should be demanded. This the court ought not to have assumed from the proof in this record, but ought to have left that feet to be determined by the jury. If the bill was drawn by Brown, for the accommodation of Patterson, and if Patterson was known .to be in the habit of .obtaining- such accommodations from his friends, and punctually providing the means of payment, this would be sufficient ground for Brown to have entertained a reasonable expectation that funds would be provided to meet the bill, and that it would be paid; and in such case he would be entitled to notice.

The ground upon which the court proceed in Biker-dike vs. Boilman, (1 Term Rep. 405) is, that where the drawer has no funds in the hands of the drawee, he is guilty of a fraud, and having drawn for his own benefit, he can receive no injury for want of notice, and therefore is not entitled to require it to be given. This rule is sound in principle, and ought not tobe changed; but where the bill is drawn for the accommodation of another,- and no fraud can be imputed on account of the reasonable expectations the drawer entertained, that the bill would be paid, the reason of the rule ceases, and in such case the drawer ought to have notice of the dishonor of the bill. Rucker and others vs. Hiller, 16 East 43: 19 Com. Law Rep. 181: Lafitte vs. Slatter, 6 Bingham, 623. The latter case is particularly applicable in its facts, to the principle above stated. In that case, the drawer knew the acceptor would not pay the bill; but the court inferred from the proof, that Rose, who owed the drawer £1000, was to have paid the bill, and that the drawer had reasonable grounds r , ,, , to expect he would do so.

In the case before the court, we do not assume the facts to be, that the bill under consideration was drawn for the accommodation of Patterson, and dial Brown had reasonable grounds to expect he would pay it; but as the evidence tends to establish the facts to be so, this question ought to be left to the jury upon a statement of the .law as here laid down.

The judgment will be reversed, and the cause remanded to the circuit court of Davidson county, for another trial to be had therein.

Judgment reversed. 
      
       Absent, Cathon, Ch. J.
     