
    James Wrigley, appellant, v. Farmers & Merchants State Bank of Beatrice, appellee.
    Filed June 8, 1906.
    No. 14,375.
    Banks: Drafts: Limitations. Where the holder of a bank draft neither demands payment of the bank cn which it is drawn nor takes any other step to secure payment within five years from the time it came into his possession, his right of action against the bank issuing the draft because of the failure of the bank on which it was drawn to pay the same when it was presented is barred by the statute of limitations.
    
      Appeal from tbe district court for Gage county: William H. Kelligar, Judge.
    
      Affirmed.
    
    
      E. 0. Kretsinger, for appellant.
    
      Rinaher & Bibb, contra.
    
   Jackson, C..

On August 10, 1894, tbe Farmers & Merchants State Bank of Beatrice, Nebraska, sold to Robert Wrigley a draft on tbe American Exchange National Bank of Lincoln, Nebraska, for tbe sum of $90. This draft was immediately indorsed by Robert Wrigley, and by indorsement made payable to James Wrigley, tbe plaintiff, appellant herein, and was either delivered or sent to plaintiff at Broken Bow, Nebraska, on tbe day it was issued. At any rate, it was received by the plaintiff within a day or two of tbe date of its issuance, and was by him mislaid and forgotten until tbe month of October, 1899, when be discovered tbe draft in an inside vest pocket. In tbe meantime tbe American Exchange National Bank of Lincoln bad consolidated with the First National Bank of Lincoln, and to tbe latter bank tbe plaintiff presented tbe draft for payment soon after its resurrection from bis inside pocket. Tbe Farmers & Merchants State Bank of Beatrice, prior to tbe presentment of tbe draft for payment, bad gone into voluntary liquidation, paid all of its ascertained indebtedness, and distributed tbe balance of its assets among its stockholders. Its account at tbe American Exchange National Bank bad been closed, and the First National Bank of Lincoln bad no funds of tbe Farmers & Merchants State Bank with which to meet tbe draft at tbe time it was presented. After presenting the draft to the First National Bank of Lincoln for payment and ascertaining that there were no funds, tbe plaintiff left tbe draft at the Lincoln bank for collection. It was sent to Beatrice, where demand was made of tbe defendant for payment. Payment was refused, and on April 7, 1903,' this action was instituted in the county court of Gage county to recover payment from tlie defendant. From a judgment in that court the case was appealed to the district court, where the finding was against the plaintiff, and he appeals.

The trial court found that the action was barred by the statute of limitations, and the correctness of that conclusion is challenged, the contention of the appellant being that the cause of action against the appellee did not accrue until the draft was presented for payment in November, 1899. Counsel for appellant has presented an interesting discussion of the distinction between a draft drawn by one bank on another and a bank check drawn by a customer. We are inclined, however, to adopt the view of the counsel for appellee that the distinction is not important to the inquiry. In Scroggin v. McClelland, 37 Neb. 644, it was held that the statute of limitations commences to run in favor of the drawer of a check, at the latest, after the lapse of a reasonable time for the presentment of the check. We see no reason for adopting a different rule in favor of the holder of a bank draft.

It is urged, however, that the case of Scroggin v. McClelland was overruled by Connor v. Becker, 56 Neb. 343. The question involved and determined in the latter case was whether the cause of action was barred by the statute of .limitations in four years, as contended by one of the parties, or in five years, as insisted by the other party. There was, in fact, a demand in that case, and the question' of when the demand should be made was not involved in the inquiry and was not determined. The rule there stated is:

“An action on a check by the holder against the maker after demand of the drawee and nonpayment is a suit on a written instrument, within the meaning of section 10 of the code of civil procedure, and the limitation is five years.”

The general rule seems to be that, where a demand is necessary, the demand must be made and the action commenced within the statute of limitations. Brust v. Barrett, 16 Hun (N. Y.), 409; Palmer v. Palmer, 36 Mich. 487; Lower v. Miller, 66 Ia. 408. The reason for the rule is that it was the right of the creditor by his own act to make the demand payable. He might by such act have perfected his cause of action, and it would be both unjust and unreasonable to hold that he could postpone indefinitely the time for enforcing his claim. The supreme court of Ohio seems to have adopted a somewhat different rule, but under the holdings in that state the demand, at least, must be made within the statute of limitations, Keithler v. Foster, 22 Ohio St. 27. The same principle is involved and determined in Atchison, T. & S. F. R. Co. v. Burlingame Township, 36 Kan. 628.

There having been neither a demand of payment nor action instituted to secure payment within the time fixed by the statute of limitations, the judgment of the district court was- right, and we recommend that it be affirmed.

Duffie, 0,, concurs.

Albert, O.

I concur in the conclusion.

By the Court: For the reasons stated in the foregoing opinion, the judgment of the district court is

Affirmed.

Letton, J., not sitting.  