Hibbard v. Russell, 16 N.H. 410 (1844) - Opinion

Hibbard v. Russell.

Demand and notice may be waived by an indorsor without writing, and may be proved by direct evidence or inferred from the language and conduct of the party.

An allegation of demand and notice is proved by evidence of a waiver of it.

A witness who states the conversation of a party, shall not state also what he understood the party meant_by the words he used.

Assumpsit against the defendant upon his liability as indorser of a promissory note. The substance of the declaration is given in the opinion of the court.

The defendant pleaded the general issue.

To maintain the issue on his part, the plaintiff introduced C. Ainsworth as a witness, who testified that on the 17th day of February 1841 the plaintiff and defendant came into his office and wished to get a conveyance made of Hibbard’s house to Russell the defendant, for which Russell was to pay Hibbard the plaintiff $2500, and he did pay a portion of it by a note against W. Cobleigh and others, and a portion by the note now the subject of this controversy, signed by Truman Stevens & Co., payable to Russell or his order, and by him indorsed in blank. He further testified that after the writings were made and Russell had gone out of the office, Hibbard inquired if Russell would be liable as indorser; witness told Hibbard that Russell would not unless the plaintiff should make demand of payment of Truman Stevens & Co.’, and.in case of non-payment by them, notify Russell therof; or unless he could get Russell to waive demand and notice on the back of the note. About five or ten minutes after Russell went out of the office, Hibbard went out; and he and Russell came back into the office, and then Hibbard told Russell what the witness had said to him in regard to the demand and notice, and requested Russell to waive demand and notice by writing over his name on the back of the note. Russell declined doing it; but said that he had agreed with T. Stevens & Co., the signers, to wait till the then next Juno for the payment of said note, and requested Hibbard to wait till that time, and not to make demand of payment or give notice; and said that if they did not pay the note then, he would pay it, or would consider himself holden as indorser; and that it should be paid the same as if he waived demand and notice on the back of the note, or used language to that effect. He further testified, that the indorsement upon the note of the name of the defendant is in the hand-writing of the defendant.

John Farr, a witness called by the plaintiff, testified that in the latter part of 1842 (he thought that was the time), in the hay-scale office in the brick store at Littleton, the plaintiff and defendant had a conversation about a note against Truman Stevens & Co. and indorsed by Russell. The recollection of the witness was not distinct as to the words used. Hibbard called on Russell for payment of the note. Russell said it did not belong to him to pay it, and that Hibbard must call on Truman Stevens & Co., or to that effect. Hibbard said that he had done that until he was tired, or that in effect, and could not get the pay. Russell said if Hibbard could not get it of them, that he was good for it, or had got it to pay, using one or the other of those expressions. Truman Stevens & Co. were not considered solvent. The defendant’s counsel then proposed asking the witness, if he understood that Russell intended to pay the note; and upon the plaintiff’s objecting to the inquiry, the same was ruled out by the court, and the defendant’s counsel objected to the ruling.

The court being of opinion that upon the foregoing evidence the plaintiff was entitled to recover, and neither party desiring to submit any fact to the jury, a verdict was taken by consent for the plaintiff, subject to the questions arising upon the exceptions of the defendant to the aforesaid opinion.

Bellows, for the defendant.

We say 1. That what took place in Mr. Ainsworth’s office after the few minutes separation, was part of the.original transaction, and the contract of indorsement could not be varied by it. Barry & a. v. Morse, 3 N. H. 132. But if otherwise, the fair import of the testimony of C. Ainsworth is, that Hibbard need not call on the makers of the note until June, and that the defendant would notwithstanding hold himself liable as indorser.

Russell intended to be held as indorser, and in that capacity alone. He expressly refuses to waive demand and notice on the note, but agreed that Hibbard need not call upon the makers until June, and he would stand holden as indorser still.

Here was a case of a note then due, and the plaintiff would under ordinary circumstances be bound to make demand immediately, and give notice. The defendant agreed that he need not do it until June, and he would still be holden as indorser. But he did not waive demand and notice. That he refused expressly; and the burden is on the plaintiff to prove clearly the waiver. He said he had agreed not to call on the makers until June, and he would not require the plaintiff to do it before. From this no waiver can be presumed.

The demand and notice being part of the contract of indorsement, it will not be considered as waived unless an express agreement is shown. To be holden as indorser, necessarily includes the idea of demand and notice. But if the agreement had been to pay absolutely, it is not clear that it would be a waiver of demand and notice. Chitty on Bills and Notes, 433, 434.

As to the testimony of John Farr. If it amount to a promise by Russell, it can not operate, for it does not appear that he was acquainted with the laches. On cross-examination Farr was requested to state his understanding of Russell’s remarks, as it would have a tendency to show what the remarks actually were, and we hold that the question was proper.

This verdict was taken by consent for the plaintiff and must stand if there was competent evidence for the jury to find such a verdict.

I. Was there a waiver of demand and notice ?

1. The indorsement of the note was complete; the plaintiff was proceeding to make demand and give notice, and forbore at the request of the defendant, and on his undertaking to be liable in the same manner as if he had waived demand and notice on the back of the note. The evidence was certainly competent for the jury to find a verbal agreement to waive demand and notice. And a verbal waiver is sufficient. Whitney v. Abbott, 5 N. H. 878; Fuller v. McDonald, 8 Greenl. 218.

Barry v. Morse, 3 N. H. 132, is not in point. If this agreement to waive demand and notice was on condition that the plaintiff should wait till June then next, that condition was performed.

2. The testimony of Farr was competent to prove a subsequent waiver of demand and notice. Wood v. Brown, 1 Starkie 217; Ladd v. Kenney, 2 N. H. 340. That the plaintiff had made demand and given notice. Gunson v. Metz, 1 Barn. & Cress. 193.

II. The evidence that the witness “understood that Bus-sell intended to pay the note,” was properly rejected.

1. The question was general, what the witness understood, not what he understood from the conversation.

2. Nor was the question, “ what the witness understood from the conversation was the agreement or admission of Russell,” as in Eaton v. Rice, 8 N. H. 378. The witness had stated the substance of the conversation; the question amounted to no more than this: Whether the witness from his knowledge of the man and the circumstances of the ease, thought that the defendant meant to keep his engagement like an honest man, or cheat the plaintiff out of his debt ?

III. There is no variance between the plaintiff’s declaration and the proof. The defendant’s subsequent admission of his liability was competent to prove a demand and notice as alleged in the first count. The evidence shows a waiver as alleged in the third count.

Proof of waiver will support an allegation of demand and notice, as alleged in the first count. Taunton Bank v. Richardson, 5 Pick. 436. The evidence was admissible under the money count. State Bank v. Hurd, 12 Mass. 172; Ellsworth v. Brewer, 11 Pick. 316; Hodges v. Holland, 16 Pick. 395; Olcott v. Rathbone, 5 Wend. 490.