Gilbert & Vason v. Seymour, Johnson & Co.

Lochrane, Chief Justice.

The controlling question in this case, presented by the record, is, whether, under the facts, plaintiffs in error were entitled to notice of the non-payment of the draft made and indorsed by them on Moughon. We have held that the Code, section 2739, applied to indorsers, and to papers intended for negotiation at a chartered bank, and that parties to notes or drafts other than indorsers, and not included in the terms of the Code, were still entitled to the notice under the rules of law, required to be given to charge them with lia*65bility. In this case, the anomaly of the relation borne by Gilbert & V as on to the draft on Moughon, presents the difficulty of the application of the legal principles involved. In the first place, they were drawers of the draft, made payable to themselves, and it was by them indorsed over to Seymour, Johnson & Company. The paper was not intended for negotiation at a chartered bank, and as such indorsers, they were not entitled to notice. Were the same parties, as drawers, entitled to notice? If distinct and independent parties, I think they were; but as the paper, taken together with the circumstances at the time, is to be regarded as one transaction, and in the light of one broad liability, we do not think the Court erred in holding that they were bound by the indorsement in the absence of notice of the non-payment of the draft by Moughon, and, consequently, that the Court decided correctly in refusing a new trial, under the law and facts of the case.

Judgment affirmed.