does not charge the transferor on any of his warranties. To be sure, if it results in the inability of the maker or acceptor to pay at maturity, the transferor, if he has indorsed, may be held as indorser. But the transferor, when he sells an instrument which although legally valid is of no practical value, because of the insolvency of the parties to it or other reason, warrants that he has no knowledge of any fact which renders it valueless. For example, the plaintiff sold the defendant a check drawn and indorsed, to plaintiff's knowledge, by an insolvent person. The defendant gave plaintiff a note for the purchase price. In an action on the note, the defendant relied for a defense on plaintiff's breach of warranty. It was held the defense was good. "Where a party negotiates commercial paper," said the court, "payable to bearer, or under the blank indorsement of another person, he cannot be sued on the paper, because he is not a party to it; but he nevertheless warrants that he has no knowledge of any facts which prove the paper to be worthless, on account of the failure of the makers, or by its being already paid, or otherwise to have become void or defunct; for, says Judge Story, 'any concealment of this nature would be a manifest fraud'" (16).

(16) Brown v. Montgomery, 20 N. Y. 287.

CHAPTER VII.

PRESENTMENT AND PROCEEDINGS ON DISHONOR.
SECTION 1. PRESENTMENT FOR PAYMENT.

§ 141. Necessity of presentment. The maker or acceptor of a negotiable instrument is bound to pay at maturity, without a presentment or any demand of payment whatever, even in the case of a note payable "on demand" (1), but the first step in making absolute the conditional liability of the drawer and indorsers is presentment for payment to the maker or acceptor.

"Presentment for payment is not necessary in order to charge the person primarily liable on the instrument. But, except as herein otherwise provided, presentment for payment is necessary in order to charge the drawer and indorser" (2).

§ 142. Day for presentment.

'Where the instrument is not payable on demand, presentment must be made on the day it falls due" (3). "Every negotiable instrument is payable at the time fixed therein without grace" (4).

(1) See § 120, above.

(2) Neg. Inst. Law, sec. 70. (3) Neg. Inst. Law, sec. 71. (4) Neg. Inst. Law, sec. 85.

If the instrument is payable Jan. 1st, presentment must be made on that day. An instrument dated Jan. 31st, and payable one month after date, must be presented on Feb. 28th or 29th, as the case may be. A bill or note dated Jan. 1st, payable "ten days after date,” must be presented on Jan. 11, and a note payable "ten days after my death," the maker of which dies on Jan. 1st, matures and must be presented on Jan. 11th. As the N. I. L. says:

Sec. 86. Where the instrument is payable at a fixed period after date, after sight, or after the happening of a specified event, the time of payment is determined by excluding the day from which the time is to begin to run, and by including the date of payment.

Instruments falling due on Saturday are to be presented for payment on the next succeeding business day, except that instruments payable on demand may, at the option of the holder, be presented for payment before twelve o'clock noon on Saturday when that entire day is not a holiday (5).

§ 143. When demand instruments must be presented. The payee of a bill or note payable on demand is entitled to its payment immediately upon its delivery, and, if he chose, he might forthwith maintain an action upon it against the maker or acceptor. In this sense a demand instrument is due on the day of its issue, and, if the ordinary rule were applied-that presentment must be made at maturity—a presentment good against parties who indorsed after that day would be impossible. But the rule

(5) Neg. Inst. Law, sec. 85.

is that an instrument indorsed after maturity is, as regards the person so indorsing, payable on demand (6). Thus the ordinary rule cannot apply to demand instruments. The N. I. L. says that where the instrument "is payable on demand, presentment must be made within a reasonable time after its issue" (7). For example, X, the holder of a demand note made by A and indorsed successively by B, C, and D, by presenting it to A, within a reasonable time after its issue by A, could hold the indorsers. Suppose, however, X held the note until after a reasonable time had elapsed, and then indorsed to Y. As regards X, the instrument would have the effect of a note payable on demand issued on the day of his indorsement. Consequently, if Y made a presentment for payment to the maker, A, within a reasonable time after X's indorsement, the presentment would be good as against X, although of course it would not revive the liability of the prior indorsers, B, C, and D (8).

§ 144. What is a reasonable time for presentment? What is a reasonable time is a question of fact for the solution of which the law offers no rule. A reasonable time within which to make presentment may be a day or two in the case of a check, or a month or two in the case of a bill or note. The N. I. L. provides:

Sec. 193. In determining what is a "reasonable time" or an "unreasonable time," regard is to be had to the nature of the instrument, the usage of trade or business (if

any) with respect to such instruments, and the facts of the particular case.

§ 145. When delay in making presentment is excused. In Patience v. Townley (9), an action against an indorser on a bill due in Leghorn on Sept. 10, 1800, the plaintiff proved a presentment on October 31, 1800. He also proved that, though he sent out the bill in time for presentment on Sept. 10th, the occupation of Leghorn by the enemy made presentment on that day impossible. The court held that the presentment on October 31st was sufficient, saying: "Duly presented is presented according to the custom of merchants, which necessarily implies an exception in favor of those unavoidable accidents which must prevent the party from doing it within the regular time.” In another case the illness of the holder, serious enough to prevent him from presenting the bill in person or from employing an agent to act for him, was held to excuse a delay in making presentment (10). These cases serve to illustrate the general rule laid down in the N. I. L.:

Sec. 81. Delay in making presentment for payment is excused when the delay is caused by circumstances beyond the control of the holder, and not imputable to his default, misconduct, or negligence. When the cause of delay ceases to operate, presentment must be made with reasonable diligence.

§ 146. Place of presentment: When place specified.