Story Case

An accident in the foundry had kept George Pe-traski in the hospital for several weeks. When he came out he was able to secure work very soon, but needed money to pay his accrued rent, doctor's bills, and other debts. This he raised by a loan from the Intercity Wage Loan Association, upon an assignment of his wages in the new job. He also was compelled to give a note, with an indorsement, which he was able to secure from his friend, Alexander Papatides. He signed the note "George Petraski, 1239 S. Eobey Street," but when the note was there presented at its maturity, he had moved away and his new address was not known. Notice of dishonor was sent to Papatides and he was sued on his indorsement. His defense consisted in the plea that when Petraski was not found at the address given he should have been sought at the factory where he worked, the address of which was known to the loan association, and that failing that effort to find him there had been no due presentment. Is the plaintiff entitled to recover or has Papatides been discharged by the failure to find the maker at his place of residence?

Ruling Court Case. Gibb Vs. Mather, Volume 8 Bingham Reports, Page 214

Mather, the defendant in this case, drew a bill upon Messrs. Chapman and Faircloth, Liverpool, "payable to Mather, or order, in London." The drawees, Chapman and Faircloth, accepted at "Messrs. Jones, Layd & Company, bankers, London." On the day the bill became due, Gibb, to whom Mather had indorsed the bill, presented it to Messrs. Chapman and Faircloth, in Liverpool, who refused to pay it. Notice of this was duly sent to Mather. Suit was then brought against him, as indorser.

It was contended by Mather that Gibb had not used due diligence, in that he did not present the bill at the proper place, as directed in the bill, and that as an indorser he was discharged.

Decision: Where a bill or note designates a particular place of payment, it is part of due diligence that presentment shall be made at that place. Here, the bill indicated that it was payable in London, the acceptance indicated the particular place of acceptance, and the failure of Gibb to present the bill at that place was a failure of due diligence, and the indorser, Mather, is relieved of his liability as indorser.

Mr. Chief Justice Tindale said: "We, therefore, think that, as no presentment was made at the house of the bankers in London, where the acceptor had undertaken to pay it, the liability of the drawer (as indorser) never arose." Consequently, judgment was given for Mather.

Ruling Law. Story Case Answer

The Negotiable Instruments Law fully covers the proper place for presentment. It is there provided: "Presentment for payment is made at the proper place: (1) Where a place of payment is specified in the instrument and it is there presented. (2) Where no place of payment is specified, but the address of the person to make payment is given in the instrument, and it is there presented. (3) Where no place of payment is specified and no address is given and the instrument is presented at the usual place of business or residence of the person to make payment. (4) In any other case, if presented to the person to make payment wherever he can be found, or if presented at his last known place of business or residence."

If there had been no address given on the note in the Story Case, a valid presentment might have been made at either the place of residence or business of the maker. Since the address was given, it would not be sufficient to present the note to Petraski at the factory or at any chance meeting in the street. He is not expected to have the money ready at any place other than the one he has designated. But a presentment at the designated place is sufficient, and if the maker is not there the liability of the indorser at once arises. The Intercity Wage Loan Association is not required to trust to finding the maker of the note at the day of maturity, but having looked for him at the designated place at a proper hour, may then proceed against the indorser, and should have judgment against Papatides.