26 U.S.

25
1 Pet. 25
7 L.Ed. 37

THE PRESIDENT AND DIRECTORS OF THE BANK OF

WASHINGTON,
PLAINTIFFS IN ERROR,
v.
PHILIP TRIPLETT AND CHRISTOPHER NEALE,
TRADING UNDER
THE FIRM OF TRIPLETT & NEALE, DEFENDANTS IN
ERROR.
January Term, 1828

TRIPLETT & NEALE, the appellees, instituted a suit in the Circuit Court
for the District of Columbia, against the President and Directors of the
Bank of Washington, the appellants; for mal-agency in relation to an
inland bill of exchange, dated Alexandria, 19th June, 1817, drawn by W.
H. Briscoe, for 625 dollars 34 cents, at four months after date, in favour of
Triplett & Neale, upon Peter A. Carnes, Esqr. 'Washington City.' About
the 19th of July, 1817, the plaintiffs, being the holders and the proprietors
of the bill, placed it in the hands of the Cashier of the Mechanics Bank of
Alexandria, for the purpose of its being transmitted to a bank in
Washington for collection, they endorsing it in blank for that purpose. The
bill, after being endorsed by the Cashier of the Bank, to the order of 'S.
Elliott, Jr. Esqr.' was sent by mail to the Bank of Washington, of which
Mr. Elliott was then Cashier; together with other bills and notes, without
any statement of interest or ownership in the same, by Triplett & Neale.
On the 19th October, 1817, the Cashier of the Mechanics Bank of
Alexandria, informed the Cashier of the Bank of Washington, that 'the
holder of the draft desired, that if the draft should not be paid, a notary
should send a notice to P. A. Carnes, Baltimore, and to Mr. W. H. Briscoe,
at Lessburgh, provided the bill should not be paid in Washington.' On the
24th October, 1817, the draft was returned to the Mechanics Bank of
Alexandria, it having been protested, for non-payment, on the 23d of
October; the drawer and endorser having been regularly notified of the
non-payment by the notary. When the bill was received in Washington, on
the 21st July, 1817, the drawee was not to be found; one of the officers of

the Bank having sought him, in order to present the bill to him, and who
was informed that he was in Baltimore. This inquiry was repeated three or
four days afterwards, with the same results, of which the Cashier was
informed. No notice of the non-acceptance of the bill was given by the
Bank of Washington to the drawer or to the endorser. Evidence was given,
by the defendant below, of the custom in the banks of the city of
Washington, and particularly of the defendants, as to the mode of treating
bills, when the drawee could not be found, and as to the practice of
protesting or not protesting such bills, for non-acceptance. Evidence was
also offered, as to the incompetency of Carnes and Briscoe to discharge
the bill, at the time of its non-payment; and that since the said period,
Briscoe had inherited an estate.
The appellants, on the trial of the cause, requested the Court to instruct the
jury:
1st. That on the evidence, if believed by the jury, the plaintiffs could not
recover.
2d. That the plaintiffs are not entitled to recover, for and of recourse
against Briscoe, the drawer of the bill.
3d. That the failure of the defendants; after having called at the residence
of the drawee of said bill, to obtain his acceptance thereof, as stated in the
evidence of Reilly, and non finding him or any other person there, to
accept the said bill; to notify the drawer of that circumstance, was not such
a negligence as discharged the said drawer from his liability on said bill;
and entitles the plaintiffs to recover.
4th. That if they believe, from the evidence, that the defendants
conformed to their former usage in regard to such bills as the one in
question, in calling on the drawee for acceptance, the said drawee being
from home, and not noting the same as dishonoured, and giving notice
thereof to the parties on the said bill; then their failure to treat the said bill
as dishonoured, and to give notice accordingly, of its non-acceptance, did
not discharge the drawer thereof from his liability to the plaintiffs. All of
which instructions were refused by the Court, and a verdict was given
against the Bank of Washington for the whole amount of the claim. The
defendants below took a bill of exceptions, to the opinion of the Court,
upon the propositions stated; and thereupon prosecuted this writ of error.
Mr. Key, for the plaintiffs in error. There was no privity between the
plaintiffs below, and the Bank of Washington; the bill was sent to the
Bank of Washington, by the Mechanics Bank of Alexandria, and it was

not known that Triplett & Neale were in any manner interested in it.
Before a contract can be presumed to have been made with them to collect
the bill, their interest should have been communicated; 2 Caines, 341. The
plaintiff in error should have had the opportunity to accept or reject the
inquiry, as the collection of the draft was only an act of courtesy. The law
is with the plaintiffs in error on this point. 6 Taunton, 147 1 Vesey jun.
291-2 Johnson, 204. In the last case, a notary public gave notice of the
non-payment of a note to one endorser, and failed to notify a prior
endorser; the last endorser having paid the note, it was decided that a suit
could not lie against the notary public for laches, he being liable only to
the holder of the note.
2d. Negligence, and loss in consequence of it, must be shown.
The bill was payable four months after date, and it is not necessary to
present such a bill for acceptance. Chitty on Bills, 205Philadelphia
edition, 1821: as to responsibility, where prejudice has not arisen; Beawes
Lex. Merc. 544, 491, was cited, as to the mode of presentation of such a
billStarkey's Evid. 4, part 456.
3d. If the Bank of Washington was bound to present the bill, the
negligence of the plaintiffs in error to do this, should have been stated
specially in the declaration; and the loss thereby specially averred; 2
Espin. 162 Wilson, 325.
4th. The conduct of the Bank was according to their established customs,
and to the practises in other banks, and if they acted bona fide, they
should not be charged with the amount of the bill. The usage is, to protest
the bill on the fourth day after the nominal day of payment, and the day
after the three days of grace. The rule and practice as to non-acceptanced
bills, is the same in this particular, with those which have been accepted.
Mr. Jones, for defendants in error. The claim of the defendants in error, is
founded upon the gross negligence of the Bankand this is fully made
out by the testimony.
1. As to the absence of privity between the parties of this suit. The custom
to collect notes for individuals, which prevailed among all banks, and the
fact that no other interest existed in the bill, but that of Triplett & Neale,
are sufficient to establish privity between the parties to the action. A suit
upon a contract made by an agent, may be brought in the name of the
principal; although his interest in the contract does not appear on its face.
2. Negligence is charged in the declaration throughout; and by the usages

of the Bank, particularly of the present Bank of the United States, if the
drawee be absent when the bill is received, and does not call at the bank
and accept, after notice left at his residence, the bill is protested, and
notice given.In this case, the bill should have been protested on the day
it became due, without waiting the days of grace, which are only allowed,
when the bill has been accepted. Mr. Jones cited the case of M'Gruder vs.
the Bank of Washington. 9 Wheat. 598.
Mr. Chief Justice MARSHALL delivered the opinion of the Court.

This is a writ of error, to a judgment of the United States' Circuit Court, of the
district of Columbia, for the county of Alexandria.

On the 19th of June 1817, Wiliam H. Briscoe, of Alexandria, drew a bill on

Peter A. Carnes, of Washington, payable four months after date, to the order of
Triplett & Neale. The payees of the bill, endorsed it in blank, and delivered it to
the Cashier of the Mechanics Bank of Alexandria, for the purpose of being
transmitted, through the said bank, to a bank in Washington, for collection.

The Cashier of the Mechanics Bank of Alexandria, endorsed the bill, to the
order of the Cashier of the Bank of Washington, and transmitted it to him, for
collection, in a letter of the 19th of July 1817. Neither of the banks had any
interest in the bill.

The bill was protested, for non-payment; and this suit was brought by Triplett
& Neale, against the Bank of Washington, to recover its amount. The
declaration charges, that the bank did not use reasonable diligence to collect the
money mentioned in the said bill, nor take the necessary measures to charge the
drawer; but neglected to present the bill either for acceptance, or payment; and
to have the same protested; whereby the plaintiffs have lost their recourse
against the drawer.

It was proved, on the part of the bank, that either on the day the bill was
received, or the succeeding day, one of its officers called with the bill, at the
house of the said Peter A. Carnes, for the purpose of presenting it for
acceptance, and was told, that he was in Baltimore. He called again, three or
four days afterwards, for the same purpose; and was again told, that he was in
Baltimore. These answers were reported to the Cashier.

On the 9th of October 1817, the Cashier of the Mechanics Bank of Alexandria,

addressed the following letter to the Cashier of the Bank of Washington;

7

'DEAR SIR,

'The holder of the draft on Peter A. Carnes, for 625 dollars 34 cents, desires me
to inform you, that if the draft is not paid, to make the notary send a notice to P.
A. Carnes, Baltimore, and likewise to W. H. Briscoe, Leesburg, provided it is
not paid at his residence, in Washington.' On the 13th of the same month, the
Cashier of the Bank of Washington, in answer to this letter, stated that the bill
had not been accepted, because the drawee could not be found; and that the
directions given, in the letter of the 9th, should be observed. On the 24th of
October, the fourth day after that expressed on the face of the bill, as the day of
payment, it was protested, for non-payment, and returned, under protest, to the
Mechanics Bank of Alexandria. Notice was given to the drawer, who has
refused to pay the same.

On the trial, the counsel for the defendant, moved the Court, to instruct the
jury:

10

1st. That upon this evidence, if believed, the plaintiffs are not entitled to
recover.

11

2d. That the plaintiffs are not entitled to recover, for any loss of recourse
against Briscoe, the drawer of the said bill.

12

3d. That the failure of the defendants, (after having called at the residence of
the drawee of the said bill, to obtain his acceptance, and not finding him, or any
person there to accept it,) to notify the drawer of that circumstance, was not
such negligence, as discharged the said drawer, from his liability, on the said
bill, and entitles the plaintiffs to recover.

13

4th. That if they believed, from the evidence, that the defendants conformed to
their former usage, in regard to such bills, as the one in question, in calling on
the drawee for acceptance, (the said drawee being from home,) and not noting
the same as dishonoured, and giving notice thereof to the parties, on the said
bill; then their failure to treat the said bill as dishonoured, and to give notice
accordingly, of non-acceptance, did not discharge the drawer thereof, from his
liability to the plaintiffs.

14

The Court refused to give either of these instructions; to which refusal, the

counsel for the defendants excepted; and a verdict and judgment were rendered
for the plaintiffs.
15

The plaintiffs in error, insist, that the Circuit Court ought to have given the
instructions first asked, because, 1st, no privity existed, between the real holder
of the bill, and the Bank of Washington. That bank was not the agent of Triplett
& Neale, but was the agent of the Mechanics Bank of Alexandria. Some cases
have been cited, to show, that if an agent employed to transact a particular
business, engages another person to do it, that other person is not responsible to
the principal. On this point, it is sufficient to say, that these cases, however
correctly they may have been decided, are inapplicable to the case at bar. The
bill was not delivered to the Mechanics Bank of Alexandria, for collection, but
for transmission to some bank in Washington, to be collected. That bank would,
of course, become the agent of the holder. By transmitting the bill, as directed,
the Mechanics Bank performed its duty, and the whole responsibility of
collection devolved on the bank which received the bill for that purpose; the
Mechanics Bank was the mere channel through which Triplett & Neale
transmitted the bill to the Bank of Washington.

16

The deposit of a bill in one bank, to be transmitted for collection, to another, is

a common usage of great public convenience, the effect of which is well
understood. This transaction was, unquestionably, of that character; and there is
no reason for suspecting that the Bank of Washington did not so understand it.
The duty of that bank, was precisely the same, whoever might be the owner of
the bill; and, if it was unwilling to undertake the collection, without precise
information on the subject, that duty ought to have been declined.The custom
to endorse a bill put in bank, for collection, is universal; and the Bank of
Washington, had no more reason for supposing that Triplett & Neale had
ceased to be the real holders, from their endorsement, than for supposing that
the Cashier of the bank of Washington, had become the real holder, by the
endorsement to them. It is the customary proceeding, for collection, in such
cases; and is for the advantage of the party interested. At any rate, the letter of
the 9th of October, disclosed the real party entitled to the money; and the
answer to that letter, assumes the agency, if it had not been previously assumed.
The Court is decidedly of opinion, that the Bank of Washington, by receiving
the bill, for collection, and, certainly, by its letter of the 13th of October,
became the agent of Triplett & Neale, and assumed the responsibility attached
to that character.

17

The first prayer of the defendants, in the Circuit Court, being to instruct the
jury, that, upon the whole evidence, the plaintiff ought not to recover; if it
might properly have been granted, in any case, in which any testimony was

offered; certainly ought not to have been granted, if any possible construction of
that testimony would support the action.
18

The liability of the bank, for the bill placed in its hands for collection,
undoubtedly depends on the question, whether reasonable and due diligence has
been used, in the performance of its duty. To maintain the charge of negligence,
the counsel for Triplett & Neale, have alleged the failure to give notice of the
non-acceptance of the bill, and the failure to demand payment in proper time.
The counsel for the bank, have brought the first question more distinctly into
view, by a more definite instruction respecting it, which was afterwards asked;
and its consideration will be deferred, until that prayer shall be discussed; but
the first must be disposed of, under the general prayer.

19

Unquestionably, by failing to demand payment in time, the bank would make

the bill its own, and would become liable to Triplett & Neale for its amount.
The inquiry, therefore, is into the fact.

20

The demand was made, on the fourth day after that mentioned on the face of
the bill, as the day of payment.

21

The defendants in error, insist, that, if the bill was never presented for
acceptance, payment ought to have been demanded, on the day mentioned on
its face. If this be not so, then it ought to have been demanded, on the third day
afterwards, which is the last day of grace.

22

The allowance of days of grace, is a usage, which pervades the whole

commercial world. It is now universally understood to enter into every bill, or
note, of a mercantile character, and to form so completely a part of the contract,
that the bill does not become due, in fact, or in law, on the day mentioned on its
face, but on the last day of grace. A demand of payment, previous to that day,
will not authorize a protest, or charge the drawer of the bill.

23

This is universally admitted, if the bill has been accepted.

24

If it has been noted, for non-acceptance, but has been held up, it would not be
protested, for non-payment, until the last day of grace. Why, then, should a bill
never presented, be demandable, at an earlier day, than if it had been accepted,
or if acceptance had been refused? Whatever might have been the original
motive for the indulgence, it is now taken into consideration, both by the
drawer and payee of the bill. The amount is, consequently, estimated, on the
calculation, that it becomes really due, on the last day of grace. Neither party

can foresee, when the bill is drawn, whether it will be paid, or not; nor, if it be
payable, after date, whether it will be presented, or not. Their calculation,
therefore, as to the day when it becomes really due, and is to be paid, is
independent of these considerations. No sufficient reason is perceived, for the
distinction.
25

It is, however, a law dependent on usage. The books which treat on the subject,
concur in saying, that payment must be demanded when the bill falls due; and
that it falls due, on the last day of grace. The distinction between a bill which
has, and which has not been presented, has never been taken; and it is apparent,
that a bill is never drawn, with a view to this distinction. The fact, that the
question has never been made, is a strong argument against it. The point has
never, so far as we can find, been brought directly before a Court; and we have
seen only one case, in which it has been even incidentally mentioned.

26

In Anderson vs. Beck & Pearson, 16 East 248, a bill was drawn, payable two
months after date, and was not presented for acceptance. It was protested for
non-payment, and a suit was brought by the holder against the drawer. He
resisted the demand, and the opinion of the Court proceeds on the admission
that the bill feel due on the last day of grace. This case consists, we believe,
with the opinions and practice of commercial towns.

27

But if a bill, payable after date, and not presented for acceptance, falls due on
the same day as if it had been accepted, the defendants in error insist, that
payment ought to have been demanded on the last day of grace.

28

It was proved at the trial, that the settled usage of the Bank of Washington, at
that time, and of all the other banks in Washington and Georgetown, was, to
demand payment on the day succeeding the last day of grace; and this usage, so
far as respects notes negotiable in a particular bank, has been sanctioned by the
decisions of this Court. Renner vs. the Bank of Columbia, 9 Wheat. 582, was a
suit brought in a Circuit Court of the District of Columbia, against the endorser
of a promissory note, which had been negotiated in the Bank of Columbia.
Payment was demanded, and the note protested on the fourth day after that
mentioned in the note as they day on which it became payable. This was proved
to have been in conformity with the custom of the Bank; and the defendant
moved the Court to instruct the jury that the demand was not in time, and that
the endorser was not liable for the note.This instruction was refused, and the
defendant brought the judgment into this Court by writ of error. The judgment,
on great deliberation, was affirmed.

29

In this case, the custom of the Bank was known to the parties to the note. But

29

In this case, the custom of the Bank was known to the parties to the note. But
the question arose afterwards, in a case in which the custom was not known to
the parties. Mills vs. The Bank of the United States, 11 Wheat. 430, was a suit
brought by the Bank against the plaintiff in error, and others, on a note
endorsed by him, and negotiated in the office of discount and deposit of the
Bank of the United States, which was protested, for non-payment, on the day of
the last day of grace.

30

It was proved at the trial, that this was according to the usage of that Bank. The
counsel for the defendant moved the Court to instruct the jury that this usage
could not bind the endorser, unless he had personal knowledge of it, at the time
he endorsed the note. The Court refused to give the instruction, and the jury
found a verdict for the Bank, on which judgment was rendered. That judgment
was brought before this Court, and affirmed. The Court said, that 'when a note
is made payable or negotiable at a Bank, whose invariable usage it is to
demand payment, and give notice on the fourth day of grace, the parties are
bound by that usage, whether they have a personal knowledge of it, or not.'

31

In the case of such a note, the parties are presumed, by implication, to agree to
be governed by the usage of the Bank, at which they have chosen to make the
security itself negotiable.

32

These cases decide that under consideration, unless there be a distinction

between a bill and a note made negotiable in a particular bank. In the case of a
note negotiable in a particular bank, the parties may very fairly be presumed to
be acquainted with the usage of that bank. As the decisions which have been
cited, depend upon that presumption, it will become necessary to inquire, how
far the same presumption may be justified in the case of a bill drawn on a
person residing in a place where this usage is established.

33

If a promissory note were made in the city of Washington, payable to a person

residing in the same place, though not purporting to be payable and negotiable
in bank, it would very probably be placed in a bank for collection. It is a
common practice, and the parties would contemplate such an event as probable,
when the note was executed.

34

The same reason seems to exist for applying the usage of the bank, to such a
note, as to one expressly made payable and negotiable in bank. Such notes are
frequently discounted, and certainly the person who discounts them, or places
them in bank for collection, stands in precisely the same relation to the bank, as
respecte its usage, as if the notes purported on their face to be negotiable in
bank. The maker of a negotiable paper, in such a case, may fairly be presumed

to be acquainted with the customary law which governs that paper, at his place
of residence.
35

In the case at bar, however, the bill was drawn at Alexandria, on a person
residing at Washington. Does this circumstance vary the law of the case?

36

The usage by which questions of this sort are governed, is different in different
places. It varies from three to thirty days and the usage of the place on which
the bill is drawn, or where payment is to be demanded, uniformly regulates the
number of days of grace which must be allowed. This bill being drawn on a
person residing in Washington, and being protested for non-payment in the
same place, is, according to the law merchant, to be governed by the usage of
Washington. Could this be questioned, still the holder of the bill, who placed it,
by his agent, in the Bank of Washington for collection, who has made that bank
his agent, without special instructions, submits his bill to their established
usage. The cases, then, which have been cited, are not different in principle
from thisand payment having been demanded, according to the invariable
usage of the Bank, was demanded in time. If then the objections to the conduct
of the Bank were confined to the demand of payment, and protest for nonpayment, the first instruction asked by the defendants in the Circuit Court,
ought to have been given. But they are not confined to the demand of payment,
and to the protest for non-payment. They extend to the steps taken by the Bank,
concerning the presentation of the bill.

37

The second instruction asked for, is in terms which are in some degree
equivocal. It may imply, either that the recourse against the drawer of the bill
was not lost, or that if lost, that circumstance would not entitle the plaintiff to
recover against the Bank; as its decision is not essential to the cause, it will be
passed over.

38

The third is more specific. The Court is asked to say, that the failure of the
Bank to give notice to the drawer, that the drawee was not found at home, when
called upon to accept the bill, is not such negligence as discharged the drawer
from his liability, and entitles the plaintiff to recover.

39

The question suggested by this prayer, is one on which no decision is found in

the Books. It depends on analogy, so far as it is to be decided by adjudged
cases. Such a bill need not be presented; but if presented, and acceptance be
refused, it is dishonoured, and notice must be given. Had the Bank taken no
step whatever to obtain an acceptance, no violation of duty would, according to
these decisions, have been committed.Can any unsuccessful attempt to do

that which the law does not require, place the agent in the same situation that he
would have stood in, had the drawee been found, and had positively refused
acceptance? Absence from home, with a failure to make provision for payment
when a bill becomes due, is a failure to pay; but absence from home when the
holder of a bill or his agent offers it for acceptance, is in no respect culpable.
Had the drawee received advice of the bill, he could not have not known, that it
would be presented for acceptance, because the law did not require it, and is
consequently not blameable for his absence, when the officers of the Bank
came to present it for acceptance. Had the bill, under such circumstances, been
protested for non-acceptance, and returned, the drawer might not have been
liable for it.
40

The bill, then, on general principles, ought not to have been protested; and the
absence of the drawee, ought not to be considered as equivalent to his refusal to
accept. It might have been a prudent precaution, to have given information that
the bill was not accepted, because the drawer had not been found, but we
cannot say, that the omission would subject the agent to loss, unless such was
the special usage of this bank.

41

4. The fourth prayer is for an instruction to the jury, that, if they believe, from
the evidence, that the defendants conformed to their former usage, in regard to
such bills, in calling on the drawee for acceptance, (the said drawee being from
home,) and not noting the same as dishonoured, and giving notice thereof to the
parties on the said bill, then, their failure to treat the said bill as dishonoured,
and to give notice accordingly, of non-acceptance, did not discharge the drawer
thereof, from his liability to the plaintiff.

42

The Court has already indicated the opinion, that this omission to treat the bill
as dishonoured, in consequence of not finding the drawee at home, if the usage
of the bank was not to notice such a circumstance, did not discharge the drawer;
consequently, this instruction ought to have been given, unless it should be
supposed foreign to the case in which it was asked. In a suit brought by the
holder against the bank, the Court was not bound to declare the law as between
the holder and the drawer, unless the liability of the bank was determined, by
the liability of the drawer. Although in the general, the one question depends on
the other, yet, it may not be universally so. The bank was the agent of the
holder, not of the drawer, and might consequently so act, as to discharge the
drawer, without becoming liable to its principal. In this case, however, as the
agent received on specific instructions, but was left to act according to the law
merchant; a course of proceeding which did not discharge the drawer, could not
render the agent liable to the principal. This prayer was, therefore, essentially
the same with that which preceded it, with this difference. The third prays an

instruction, whatever might be the usage of the bank; the fourth prays
essentially the same instruction, provided the conduct of the bank conformed to
its usage. This instruction, therefore, ought to have been given, as prayed. Upon
a review of the whole case, the Court is of opinion, that, if the bank acted in
conformity with its established usage, in not noting the bill, and giving notice
thereof, when the ineffectual attempt was made to present it for acceptance, this
action could not be supported. With respect to this usage, the testimony is
contradictory, and ought to have been submitted to the jury, in conformity with
the last prayer made by the counsel for the bank. The Court erred, in not giving
this instruction, as prayed. The judgment, therefore, is to be reversed, and the
case remanded for a new trial.
43

This cause came on, &c., on consideration whereof,This Court is of opinion,

that the Circuit Court erred, in refusing to instruct the jury, that if they believed
that the defendants conformed to their former usage, in regard to such bills as
the one in question, in calling on the drawee for acceptance, (the said drawee
being from home,) and not noting the same as dishonoured, and giving notice
thereof to the parties on the said bill, then, their failure to treat the said bill as
dishonoured, and to give notice accordingly, of non-acceptance, did not
discharge the drawer thereof from his liability to the plaintiffs. It is therefore
considered by the Court, that the said judgment be reversed and annulled, and
that the cause be remanded to the said Circuit Court, with directions to award a
venire facias de novo, and to proceed therein according to law.