Thorpe v. Pecks.

The plaintiff introduced in evidence, and proved the execution by H. W. Catlin, and the endorsement by the defendants of the note described in his declaration. In order to charge the defendants as endorsers, the plaintiff proved that on the ninth day of August, 1854, the note was presented for payment at the Commercial Bank in Burlington, during the usual business hours, and was not paid. The business hours of the bank were at that time usually from nine o'clock, A. M., till four o'clock, P. M., but sometimes the bank was kept open later than that hour for business, and any person coming to do business after that hour would, by the practice of the bank at that time, be admitted for business, if an officer of the bank were there. About four o'clock, P. M. of that day, the cashier of the bank took to the store of the defendants in Burlington a written notice of the non-payment of the note for the defendants, and delivered it to one of them.

Upon these facts, the court rendered judgment for the plaintiff for the amount of the note and costs, to which the defendant excepted.

W. W. Peck and E. Harvey for the defendants.

The note was payable at the bank; the maker had till 4 o'clock, P. M. of the day of maturity for payment. Till then, there was no default upon his part; 21 Pick. 310, Church v. Clark.

"Notice is bad, if it be before a dishonor;" Story on Notes, § 320. In this case, if the notice was given before 4 o'clock, P. M., it was before the dishonor and premature. It was given about 4 o'clock, P. M. It does not appear whether it was before or after that hour-whether premature or seasonable. If premature, endorsers were not charged; the duty rests on the holder to show all the steps to have been taken, which were requisite to charge the endorsers

Geo. F. Edmunds for the plaintiff.

"When a bill is accepted, payable at a bankers, it must be presented there before the usual hour of shutting up their shop." Chitty on Bills, 387; Story on Notes § 226. This note "was pre

sented for payment during the usual business hours;" Byles on Bills, [166.]

"After refusal to pay on demand made on the day when the money is due according to the contract, the note or bill is dishon

Thorpe v. Pecks.

ored, and notice may be immediately given;" 1 Pick. 401, Shedd v. Brett; Bailey on Bills, 261; Story on Notes, § 320.

The opinion of the court was delivered by

ISHAM, J. The presentment of this note for payment was made at the bank during its business hours, on the day it fell due, and was not paid. It does not appear at what time of that day the presentment was made, whether during the former or latter business hours of the bank;-neither do we regard it as in any way material. When a note is payable at a bank where its business is transacted during certain specified hours of the day, the note may be presented during any of those hours, and it is the duty of the maker to provide for its payment whenever the presentment is made. If the note is not paid when presented, the holder is at liberty to treat it as dishonored, and it is sufficient to charge the endorsers; Osborne v. Monclure, 3 Wend. 170; Flint v. Rogers, 15 Maine 67.

The notice of non-payment of this note was given about 4 o'clock, P. M., on the same day it was presented for payment and dishonored; and we think it is sufficient to charge the defendants as endorsers. The fact that notice was given earlier than was necessary or is required, is not an objection that can be urged by them. The rule is, that notice may be given the same day the paper is dishonored; and at farthest, it must be on the following day; Grand Bank v. Blanchard, 23 Pick. 305; Shedd v. Brett, 1 Pick. 405; Burbridge v. Manners, 3 Camp. 193. In order to charge the endorser, notice may be given immediately upon the dishonor of the note. There are many cases in which it has been held that, not only, notice of dishonor may be given to charge endorsers, but that a suit may be commenced, on the day of its dishonor against the maker, and endorser after notice has been given; Staples v. Franklin, 1 Met. 43, and cases cited. But, as a general rule, the maker has the whole of that day in which to make payment; and there is no default on which an action can be sustained until the next day. The question, however, as to the time when notice may be given to fix the liability of an endorser, is not the same with the question, at what time a suit may be brought. So far as it may be necessary to fix the liability of endorsers, the demand may be made,

Austin v. Harrington.

and notice given on the day the note falls due, and is dishonored; but a suit may not be commenced until the next day. These principles and that distinction was recognized in the case of Osborn v. Monclure, 3 Wend. 179, and in Thomas v. Shoemaker, 6 Watts & Sergt. 179. In this last case, the action was against an endorser of a note. The demand of payment was made on the day the note fell due, and notice of its dishonor was given on the same day between three and six o'clock, P. M. Gibson, Ch. J., observed that "the contract of the acceptor or maker is to pay on demand, "and that is broken if the bill be not paid the instant it is presented: "from which," he observes, "it results that notice may be given the same day. It is true," he says, "an action cannot be brought till "the next day, for the reason that the maker may pay after refusal "if he take the trouble to seek the holder;"

66

Coleman v. Carpenter, 9 Barr 178; 1 Amer. Lead. Cases 395. Whatever may be the rule as to the time when an action may be commenced, we think the notice is sufficient in this case to render the defendants liable on their endorsement of this note.

The judgment of the county court is affirmed.

SALLY AUSTIN v. WILLIAM C. HARRINGTON.

[IN CHANCERY.]

Usury.

The defendant borrowed of the oratrix, through her general agent, a sum of money for which he gave his note; and on the same occasion, but without the personal knowledge of the oratrix, he purchased a span of horses belonging to the agent for $ 400,00, and gave his note to the agent for that sum and subsequently paid it. The horses were not worth over $225,00. The defendant made the purchase and agreed to give $175.00 more than the horses were worth for the purpose of procuring the loan. Held that the $175,00 thus received by the agent was usury, and should be deducted in ascertaining the amount due on the oratrix's note.

BILL OF FORECLOSURE OF MORTGAGE.

The master, to whom

it was referred to ascertain and report the amount due, reported

Austin v. Harrington.

the following facts. On the 5th of March, 1847, the oratrix loaned to the defendant the sum of $7,000.00, for which the defendant gave his note, payable to the oratrix, and secured by mortgage. Gustavus A. Austin, the son of the oratrix, was her general agent to transact her business, and the contract for said loan was made by and between the defendant and the said Gustavus A, as the agent of the oratrix, at the house of the oratrix in Orwell; and it did not appear that the oratrix was consulted by either the said Gustavus or the defendant, concerning said loan, or that she was informed by the said Gustavus that he was making, or had contracted to make said loan in her behalf.

On the occasion of said contract for said loan being made, and at the same time, the said Gustavus sold to the defendant a pair of bay horses at the price of four hundred dollars, for which horses, the defendant gave his note to the said Gustavus for four hundred dollars, payable on demand, with interest. The horses were the property of Gustavus, and the money loaned was the property of the oratrix; but it did not appear that the oratrix had any knowledge of the sale of said horses, by the said Gustavus, to the defendant. This note for $ 400,00 was subsequently paid in full to the said Gustavus. The horses, so sold to the defendant by the said Gustavus, were not worth over two hundred and twenty-five dollars.

The defendants insisted that the sale of the horses by the said Gustavus to the defendant for a price so much exceeding their value, was a cover for usurious interest on said loan; and that, although the horses were the property of the said Gustavus, and the money loaned was the property of the oratrix, the security taken by the oratrix was tainted with the usury; and, on this point, the master found that, as the loan was made to, and the horses were purchased by the defendant at the same time, and on the same occasion, and as the defendant paid $175,00 more for the horses than they were worth; he made the purchase of the horses at the price of $ 400,00 for the purpose of procuring said loan, though nothing was said that the purchase of the horses should be a condition of the loan; and that if the court were of the opinion that such purchase under this state of facts, made the loan usurious, then the $ 175,00 paid for the horses more than they were worth,

Austin v. Harrington.

should be deducted from the $7,000,00 for which the defendant gave his note.

The master reported the amount due both on the basis of deducting, and also of not deducting the sum of $ 175,00 from the original loan of $7,000; and the court of chancery made their decree for the payment only of the sum reported on the basis of deducting said sum of $175,00, and from their decree the oratrix appealed.

There were other subsequent transactions between the parties in reference to the above, and an additional loan, which were reported upon by the master, but upon which no question was decided by the supreme court, and which it is therefore unnecessary to detail.

Peck & Harvey for the oratrix.

C. Russell for the defendant.

The opinion of the court was delivered by

ISHAM, J. The question in this case arises upon the report of the master, in stating the balance due on the mortgage debt, on which this bill of foreclosure is brought. It is claimed that the sum of $175,00 should be deducted from the debt for which this mortgage was given, as having been usuriously taken at the time the loan was made. There is no doubt that such should be the result, if, in point of fact, the transaction was usurious, and that amount was paid under those circumstances; for it is optional with the party paying the money, to treat it as paid on the debt, or as a payment having no connection with the legal demand, and bring his action to recover it back; Nichols v. Bellows, 22 Vt. 581. The loan in this case was made by the oratrix through the instrumentality or agency of her son, Gustavus A. Austin. It was for the purpose of procuring the loan, as the fact is stated by the master, that the horses were purchased of Mr. Austin at the sum of $ 400, being $175,00 more than their actual value in money; and for which a note was given to him; and another note for the money loaned was given to the oratrix. If, instead of giving separate notes, the whole amount had been included in one note, payable either to Mr. Austin or the oratrix, no one would doubt but that,