
    *Moses v. Trice.
    November Term, 1871,
    Richmond.
    [8 Am. Rep. 609.]
    1. Promissory Note — Lost—Action at Law. — An action at law cannot be maintained upon a lost negotiable note, whether not due or over due at the time of the loss.
    2. Same — Same—Same — Statute of Limitations. — But if at the time of the trial a recovery upon the lost note would bebarredby the statute of limitations, the action may be maintained.
    3. Same — Destroyed—Proof.—An action at law may be maintained upon a note that has been destroyed: The evidence should, however, satisfy the jury, beyond any reasonable doubt, that'the note has been destroyed.'
    4.. Same — Renewal—Case at Bar. — M borrows of T, early in 1864, Confederate money, and fexecutes his negotiable note, endorsed by D, for the amount, payable in ninety days, at the Bank of Virginia. This note is renewed from time to time, until the 4th of January. M then proposes to pay off the note to T. hut at the request of T renews the note again, upon the promise of T that he will deposit the note in hank for collection; and before the note falls due M deposits more than the amount of the note in the hank, where it remains un-til the "bank fails. A few days before the note is due the hank is burned out, the note not having been deposited in hank. Hlsnu:
    1. Same — Same -Tender. — M’s offer to pay, he consenting- to renew the note, and his depositing the money in hank, was neither a tender, nor accord and satisfaction; and he is still liable to pay the amount due upon the note.
    2. Same- -Same - Discharge. — The note being a renewal of a former note, and all the notes haying been given for the same loan of money, T might have sued on the original note, or for the money loaned, and therefore he is entitled to recover, though at the time the note sued on fell due Confederate currency was worthless.
    3. Scaling — Province of Jury. — It is for the jury to fix the time when the scale of depreciation shall be applied to the debt; and it was error in the court to instruct them that the plaintiff was entitled to recover the value of Confederate currency at the date of the original transaction.
    *This was an action of debt in the Circuit court of the city of Richmond, broug-ht by George W. Trice against Alfred Moses, as maker, and George Davis, as endorser, of a lost negotiable note for twenty-one thousand dollars, bearing date the 4th day of January 186S, and paj’able at ninety days at the Bank of Virginia. The declaration set out the making and endorsement of the note; and stated as excuse for not demanding payment at the bank, that the bank had been burned on the 3d of April, and had no place of business when the note fell due; but that on the 10th day of June the note was duly presented to Moses for payment; but that neither Moses nor Davis had paid the same, and that on the 9th of August, 1865, the note was duly protested for non-payment, and due notice given thereof to Davis.
    The defendants appeared, and demurred to the declaration, and pleaded “nil debet.” The demurrer was sustained as to Davis; but overruled as to Moses; and the parties went to trial on the plea.
    On the trial it was proved that the bank was burned out on the 3d of April 1865; and that in June, the note was put into the hands of a notary for protest; and was protested ; and whilst it was in his possession, his pocketbook, with the note in it, was stolen out of his chamber at night.
    It was further proved that in January or March 1864, Trice lent to Moses $27,000 of Confederate currency of the old issue, for which, after deducting ten per cent, from the amount, Moses gave him his note endorsed by Benjamin Davis, payable in ninety days, at the Bank of Virginia. This note was renewed from time to time, as it fell due; George Davis becoming the endorser on the two last notes in place of Benjamin. Tour thousand dollars was paid on the note when George Davis became the endorser. When the last note was given Moses insisted upon paying the debt, but, as he says, at the earnest request of Trice, who said he was about to go to *Texas, he renewed the note, with the promise of Trice, that he would put it in the bank for collection, as Moses wanted to pay it. And it was proved that when the note fell due, and for some time previous thereto, Moses had in the Bank of Virginia on deposit, Confederate money more than sufficient to pay it.
    The cause came on for trial in Rebruary 1869; and when the plaintiff offered the evidence to prove the protest and the loss of the note, the defendant moved to exclude the evidence, on the ground that an action at law cannot be maintained on a lost negotiable note. But the court overruled the motion and admitted the evidence; and the defendant excepted.
    After the evidence had been introduced, the plaintiff moved the court to give certain instructions, which were refused; and he excepted: but it is unnecessary to state them. The defendant also asked for instructions, the 3d, 4th and 5th of which are as follows: 3d. If the jury believe from the evidence, that the consideration of the note sued on was Confederate States treasury notes, and that said note was made with reference to Confederate States treasury notes as a standard of value; that the defendant, Moses, in the early part of January 1865, when the note was given, was ready and offered to pay to the plaintiff the amount of said note, and was induced to retain the same at the instance and solicitation of the plaintiff, and as a matter of accommodation to him; and if the jury further believe, that before said note fell due, said Moses deposited in the Bank of Virginia, where the said note was payable, an amount of Confederate States treasury notes sufficient to pay said note, and has never withdrawn the amount; that- said oank has failed, and said money has become worthless in said bank, without any default on the part of defendant, then the plaintiff cannot recover in this action.
    4th. If the jury'believe from the evidence, that the promissory note on which this action is brought, was executed *by Alfred Moses, on or about the 5th of January 1865, was endorsed by George Davis, and delivered, on or about the same day, to the plaintiff; and that said note provided for the payment of $21,000; and was by the true understanding and agreement of the parties thereto, to be fulfilled and performed in Confederate States treasury notes as a standard of value, then the jury must find for the plaintiff the value of $21,000 of Confederate treasury notes at the date of the note sued on, with interest thereon from said date.
    ■ 5th. That if the jury believe from the evidence, that the contract on which the action is founded, was according to the true understanding and agreement of the parties, to be fulfilled and performed in Confederate States treasury notes, or was entered into with reference to such notes as a standard of value, then to the value of said notes at the proper date of scaling, nothing should be added on account of the present depreciation of United States paper currency as compared with gold.
    These instructions the court refused to give; and instructed the, jury as follows:
    ' The court instructs the jury, that if they believe from the evidence, that the note in question was actually made by the defendant, Moses, in renewal of another- note; that the said note has been lost and. cannot now be found; that it was so lost after it had become due and payable; that the note for which the note in suit was given was also a renewed note; that the original consideration thereof was a loan of Confederate money from the plaintiff to the defendant in January or March 1864, or at. any other time, and that it was the intent aij^l understanding of the parties that the said note should be paid in Confederate money; then the plaintiff is entitled, in the opinion of the court, to their verdict for the value of said Confederate notes at the date of the original transaction ; that the jury must determine from the evidence, *at what time the first note was given and the consideration passed.
    On the other hand, if the jury believe from the evidence; that it was the understanding of the parties at the time of making the contract, that the said note should be payable in any other currency than Confederate notes, or with the currency then in use, they will then find a verdict- accordingly. To the opinions of the court refusing the instructions asked by the defendant and giving that given, the defendant excepted.
    The defendant then asked for the following instructions, numbered 6 and 7:
    No. 6. If the jury believe from the evidence, that the contract for the enforcement of which this suit is brought, was, according to the ' true understanding and agreement- of the' parties to' be fulfilled or performed in Confederate States treasury notes, or was entered into with reference to such notes as a standard of value, then it is the province of the jury to decide what period is to be taken as the proper time at which to apply the scaling provided by law.
    No. 7. That the jury in ascertaining the proper period for scaling the Confederate treasury notes which they may find the contract in suit to call for, are bound to follow the intentions of the parties as implied by law from' the contract in suit, unless such implication is repelled and rebutted by evidence of a different understanding, assented to by both parties to said contract.
    To these instructions the plaintiff objected; but the court overruled the objection ; and the plaintiff excepted.
    The jury found a verdict in favor of the plaintiff for eleven hundred and thirty dollars and seventy-eight cents, with interest thereon' from the 7th of April 1865; and the court rendered a judgment accordingly. A motion for a new trial, on the ground that the verdict was contrary to the evidence, seems, from the record, to have been made by both parties, and that both parties excepted. *The defendant applied to this court for a supersedeas to the judgment, which was awarded.
    Keily, for the appellant.
    Lyons, for the appellee.
    
      
       Negotiable Notes — Renewal—Discharge.—! Bank v. Good, 21 W. Va. 465, the court citing the principal case, said: “It is well settled in both Virginia and this state, that a note will not be regarded as an absolute extinguishment or payment of a precedent note or pre-existing debt, unless it be so expressly agreed.”
      The principal case is also cited and followed in the following cases: Tardy v. Boyd, 26 Gratt. 638, and note, Kimmins v. Wilson, 8 W. Va. 591; Miller v. Miller, 8 W. Va. 549; Hopkins v. Detwiler, 25 W. Va. 748; Stephenson v. Rice, 12 W. Va. 586; Feamster v. Withrow, 12 W. Va. 613; Bantz v. Basnett, 12 W. Va. 823, 828, 844, where the question is discussed at length.
      See, in accord with the above, Poole v. Rice, 9 W. Va. 75; Dunlap v. Shanklin, 10 W. Va. 662; Sayre v. King, 17 W. Va. 562; Farmers' Bank v. Mut. Ass. Soc., 4 Leigh 88; Lewis v. Davisson, 29 Gratt. 225; Lazier v. Nevin, 3 W. Va. 627-8.
    
    
      
       Scaling. — See principal case cited in Jarrett v. Nickell, 9 W. Va. 353.
    
   STAPLES, J.,

delivered" the opinion of the court.

This case presents the question, whether an action at law can be maintained upon a lost negotiable note transferable by delivery. No decision can be found in the Virginia Reports involving this precise point. In England the doctrine is firmly established, that such an action cannot be maintained ; and the sole remedy of the owner is in a .court of chancery, which can adjust the equities of the parties, and require suitable indemnity as' a condition of relief. Hansard v. Robinson, 7 Barn. & Cress. 90; Ramuz v. Crowe, 1 Exch. R. 166; 18 Eng. Law & Eq. R. 514. In this country there has been some conflict of opinion on the subject; but the great weight of authority is in harmony with the English doctrine. In some of the States statutory remedies have been provided, by which most of the difficulties standing in the way of actions at law have been removed. In other States having common law and equitable powers blended in the same courts, it is the constant practice of those courts to assume jurisdiction in this class of cases. Thus in Massachusetts it has been decided that the court, holding a just regulating power over the judgment and proceedings before it, has authority to prescribe an equitable security to the maker of a lost note, by a proper and suitable indemnity. Fales v. Russell, 16 Pick. R. 315. And so in Pennsylvania, it is held that the failure to indemnify is not in bar of the action, but is merely a prerequisite to an execution to enforce the judgment, and the right to restrain such execution is an equitable power vested, in the courts, to be administered with the machinery of common law forms.

*It is obvious that these principles have no application in those States where the common law and equity tribunals are separate and distinct. In these latter, we find the courts of common law steadily refusing to take jurisdiction of suits upon lost negotiable instruments. 2 Parsons on Bills and Notes, 296 and 8 and notes ; 2 Rob. Prac., new ed., 220. The learned counsel for the appellee has cited a number of cases which he supposes to be in conflict with these views. Some of these cases show that when a bank note has been cut in halves, and one half lost, the holder may recover ujion the other half at law. Upon this proposition there is also much conflict of decision. But, whatever may be the rule in some of the American courts, in regard to action upon bank notes, the cases of the Bank of Virginia v. Ward, 6 Munf. 166; Farmers’ Bank of Virginia v. Reynolds, 4 Rand. 186, indicate that in this State no such action can be maintained; because the owner can only recover on establishing his title by the judgment of a court of equity, and giving a satisfactory indemnity to secure the bank against future loss from the appearance and setting up the other half of such note.

In Renner v. Bank of Columbia, 9 Wheat. R. 581, the note was lost after suit brought, not by the plaintiff or his agents, but by the officers of the court. The holder had a perfect right of action at law at the time of the institution of his suit: he could not be deprived of that right by an accident in no manner attributable to his negligence, and turned round to another forum for redress. This rule is recognized in other cases; and is not in conflict with the general principle applicable to negotiable instruments. That principle is, that the party to such an instrument, when he is called upon to pay it, has the right to insist it shall be produced and delivered up to him. And this rule is’ not varied because suit is brought and payment demanded under 'x'compulsory process of law. In either case the maker has the right to call for'the production of his note.

As the owner, however, in case of loss of the instrument, cannot do this, the .courts allow a recovery upon the terms of his giving proper indemnity. A court of common law cannot require such indemnity as a part of its judgment. It can neither impose terms upon the plaintiff as a condition of such judgment, nor prevent the issue of an execution thereon. In Pierson v. Hutchison, 2 Camp. R. 211, Bord Rllenborough said, whether an indemnity would be sufficient or insufficient, is a question of which a court of law cannot judge. See also Greenway, ex parte, 6 Ves. R. 862; Aranguese v. Scholfield, 38 Eng. L. & Eq. 424; 1 Story, Eq. Jur. § 84 and 85. Numerous other authorities might be mentioned to the same effect. They establish that the only remedy in such cases is in a court of equity, where all the circumstances of the loss can be fully investigated, and a suitable and proper indemnity -provided.

It is insisted, however, that these principles do not apply in the case of notes lost after maturity. The counsel for the appel-lee says it is clear that a protested negotiable note has no more negotiability, according to the law merchant, than a bond or other paper originally not negotiable. No authority is cited in support of this proposition. I will not say no cases or dicta can be found to sustain it. It is certainly in conflict with the leading decisions, and the opinions of the most accurate writers on commercial law. In Story on Promissory Notes, 1 178, it is said “a negotiable note may be transferred at any time while it remains a good, subsisting, unpaid note, whether before or after it has arrived at maturity; and in the latter case, even though it be protested for non-payment, and bears upon its face the marks of its dishonor.” In Miller v. Davis, 14 Gratt. 1, 13, Judge Moncure, speaking for the court, says in reference to overdue notes: 1 ‘It has long been settled that they are ^negotiable; and it belongs to the Begislature to make them assignable only.” See also, Baxter v. Little, 6 Metc. R. 7; 2 Rob. Prac. new ed. 253; 2 Parsons on Bills and Notes; Chitty on Bills, 217; Redf. & Big. Beading cases on Bills of Exchange and Promissory Notes.

It is true, that the person taking a dishonored note, takes it subject to all the equities attaching to the instrument in the hands of the original parties; and it may be conceded for the sake of argument, that when the note has been lost, he holds it subject to all the objections which affected it in the hands of the party who first tor-tiously transferred the note. But the answer given to this reasoning is, that it is part of the contract of the maker to pay on the presentment of the instrument to him for that purpose, and he has therefore a right to its possession as his voucher against a future demand. Besides, the maker may not be able to show the note was lost after maturity; and he is not to be exposed to such risk without indemnity.

In Hansard v. Robinson, 7 Barn. & Cress. 90, Lord Teuterden said: “If the bill should afterwards appear, and a suit be brought against the acceptor — a fact not absolutely improbable in the case of a lost bill — is he to seek for the witness to prove the loss, and to ‘ prove that the new plaintiff must have obtained it after it became due? Has the holder a right, by his own negligence or misfortune, to cast this burden upon the acceptor, even as a punishment for not discharging the bill on the day it became due. We think the custom of merchants does not authorize us to say that this is the law. It is impossible to deny the force or soundness of these views. They are fully sustained by the adjudicated cases, by the most eminent writers on Commercial Baw, and by the opinions of three of the judges of this court; and must be regarded as the established doctrine of this State. Miller v. Davis, 14 Gratt. 1; 2 Green, Bill of Exchange *and Promissor3 Notes; Story on Promissory Notes, § 450, note 2; Byles on Bills, 300; 2 Parsons on Notes and Bills, 295; Edwards on Bills, 297.

When, however, it appears that the note or bill has been destroyed, different principles apply. Whatever diversity of opinion, on this point, may have formerly existed, it is now the established doctrine that the holder, upon showing the destruction of the note after its maturity, may recover thereon in a court of law. In such case no indemnity is necessary, as the maker can in the nature of things encounter no risk in paying the note. Beading Cases upon Bills of Exchange and Promissory Notes, 679; 2 Parsons on Bills and Notes, 295; Chitty on Bills, 154. It is true that when the evidence of the destruction is merely presumptive, the maker is exposed to the danger of the reappearance of the instrument in the hands of a bona fide holder. This, however, only manifests the importance of clear and satisfactory proof of the destruction. The degree of evidence necessary to constitute such proof can never be previously defined. It is impracticable, in the nature of things, to lay down any rule on the subject. The only legal test in this, as in other cases, is the sufficiency of the evidence to satisfy the jury beyond reasonable doubt, that the note is no longer in existence.

The evidence adduced by the defendant in error, in the court below, established the loss of the note by robbery; but was not of itself sufficient to prove its destruction. It was not offered with that view, nor passed upon by the-jury in that connection. The motion to exclude the evidence substantially raised the question of the right to sue at law upon a lost note; and the ruling of the court was in effect an affirmance of the right. Th.e court no more invades the province of the jury by excluding evidence, than by pronouncing it insufficient in law. By one course the evidence is thrown out of the casé, and by the other it is destroyed; which in *effect is the same thing. Bell v. Crawford, 8 Gratt. 110, 132. I think, therefore, the court erred in overruling the motion to exclude the evidence set out in the first bill of exceptions. Eor this error the judgment must be reversed, and the cause remanded for a new trial. On such trial the defendant in error may be prepared to produce the note, or possibly to trace it to the possession of the plaintiff in error; or to show that at the time of the trial a recovery thereon would be barred by operation of the statutes of limitation; or he may be able to produce satisfactory evidence of the destruction of the note, or such circumstances as would plainly justify a jury in presuming that fact. Although the evidence set out in the first bill of exceptions only proved the loss of the note by robbery, yet, if hereafter offered in connection with other facts and circumstances, tending to prove its destruction, the court below would be warranted in permitting it to go to the jury for the purpose of creating a presumption that the instrument had been in fact destroyed.

■These views render it necessary to consider the remaining grounds of error suggested by the plaintiff- in error. One of these is to the refusal of the Circuit court to give certain instructions, designated in the record as defendant’s instructions, No. 3, 4 and 5. The proposition involved in the fifth was settled by this court in Magill v. Manson, 20 Gratt. 527. Instructions No. 3. and 4 raise the question of the extent of the liability imposed by the negotiable note in controversy. It appears that in the latter part of the year 1863, or early in the year 1864, the plaintiff in error borrowed from the defendant in error about twenty-five thousand dollars, in Confederate treasury' notes, and executed therefor his negotiable note with an endorser, payable in ninety days, without interest. This note was renewed from time to time, the plaintiff in error paying the interest in advance upon each renewal; and on one occasion four thousand ^dollars of principal. The note in question is one of those, and the last executed upon such renewal.

The first instruction of plaintiff in error asserts the proposition, that he was discharged from the debt by his offer to pay the note maturing in Januarj' 1865; his subsequent deposit of the amount due in the Bank of Virginia, and its entire lofes by the failure of the bank. It may be true that the plaintiff in error offered to make such payment; and that he was induced by the persuasions of the defendant in error to withdraw such offer and to retain the money in' his own hands; but these matters constituted neither a payment, nor an accord and' satisfaction of the debt. Had the plaintiff in error persisted in his tender and then deposited the notes in bank to the credit of the defendant in error, there might be some plausibility in his pretension. But so far from insisting on the tender, he waived it, and permitted himself to be persuaded to retain the money, and executed a new note for the debt. His subsequent deposit of his funds in bank in his own name, and their ultimate loss cannot affect the obligation of his contract. The court was therefore not in error in refusing this instruction.

The question intended to be raised by the other instructions relates to the time of applying the scale of depreciation; the plaintiff in error insisting that January 1865, the date of the last note, should be adopted. As the note matured after the close of the war, the rule in Dearing’s adm’x v. Rucker, 20 Gratt. 426, cannot apply. What rule should be adopted in such case, has never been settled, nor is it necessary to consider that question now. As before stated, the original loan was made in 1863 or 1864, a note given for its repayment, which was-renewed from time to time. The last note being dishonored, there is nothing to prevent a resort to the original consideration. Upon familiar principles, if a note is taken as a conditional payment, or in renewal, and is not duly paid or discharged, the original debt revives ; *and this principle applies to every renewal, which is but a continuation of the same debt. Nor is it material whether the note or bill be given for a precedent or co-temporary debt; in neither instance will it operate as an extinguishment or payment, unless it be so accepted by the creditor. If not paid at maturity, the creditor may sue upon it, or upon the original cause of action. And if between the time of drawing the bill or making the note the currency is depreciated in which it. is to be paid, it should be discharged according to the value at the time when the note or bill was executed. Story on Bills of Exchange, $ 418; Byles on Bills, 284; 2 Parsons on Bills and Notes, 156; 5 Rob. Prac. 845; Farmer’s Bank v. Mutual Assurance Society, 4 Leigh, 69; Parker v. Cousins, 2 Gratt. 372. In this case the defendant in error might have sued for the original debt, or he might have inserted in his declaration a count for the recovery of the amount loaned. His failure to do so does not preclude the jury from applying the scale at the date of the loan, if it seemed to them right and proper under all the circumstances. If, however, any error was committed in respect of this matter, the plaintiff in error has no cause of complaint as the court on his motion instructed the jury it was their province to fix the period for appljfing the scale. The court, however, further instructed the jury that the plaintiff was entitled to their verdict for the value of the Confederate notes at the date of the original transaction. Under the act of 1866-’7, it is the province of the jury to fix the period at which the scale of depreciation shall be applied. In the exercise of this discretion they cannot be controlled by the court, unless indeed the contract of the parties, or some fixed rule of law, prescribes the measure of recovery. The court was therefore in error in giving this instruction; nor was the error corrected by the subsequent instruction given at the instance of the defendant, that it *belonged to the jury to fix the period for applying the scale of depreciation.

Por these errors the judgment must be reversed, and the cause remanded for further proceedings, in accordance with the principles herein announced.

Judgment reversed.  