hundred years ago, "the old and rightful custom" of merchants was recognized in Magna charta, ch. 30, and often in subsequent statutes; and so was the law merchant. Two centuries ago, Hobart C. J. said, " the custom of merchants is part of the common law, of which judges ought to take notice;" and ever since, this has been the settled opinion. Still we find no decisions, shewing to what contracts and actions this custom extended; but early in the reign of Charles II. it was held, the law of merchants was the law of the land, and was good for any one without naming himself merchant. CH. 24. Art. 4. Butter v. 4. It was for a long time deemed necessary to shew or 12 Mod. 15, plead this custom, but A. D. 1691, it was held not necessary; dore v. Holt 16. Maggaas in this case an action was brought by an endorsee, against & al.-1 the drawer of a bill of exchange. The plt. stated, the deft. Show. 318, drew it according to the custom of merchants, on W., mer- Play-1 chant at Rotterdam, payable to H., and alleged the custom; Mod. 27. that H. assigned the bill to the plt. ; that he tendered it to W.; and that he did not pay it-was protested &c. Judgment for the plt.; and held, 1st. "the law of merchants is jus gentium, and is part of the common law;" and ergo, "it is not necessary to shew custom of merchants." A. D. 1693, there was Carth. 260.a like decision, and held, also, setting forth such custom spe- 12 Mod. 37, Hodges v. cially in the declaration is but surplusage. Also, a bill of ex- Steward.change, payable to A or bearer, is not assignable; but one Salk. 115.payable to order is, by the authority given in it. This was Hard. 486, said in regard to an inland bill, drawn by the deft. on himself; field v. Withand it is observable the court said this bill was assignable by erley. reason of the authority given in it. 2d. Held, this was a good bill between the endorser and the endorsee," for the endorsement is in the nature of a new bill." 3d. One's drawing a bill makes him a merchant quoad hoc. and Sarse 180. 2 Lutch. A. D. 1696, Treby C. J. said, "that bills of exchange at 1Ld. Raym. first were extended only to merchant strangers, and afterwards to inland bills between merchants trading one with another 1585, Brunshere in England; and after that to all traders and dealers, and wick v. Lloyd.of late to all persons trading or not, and there was no occa- 6 Mod. 29, sion to allege any custom," and this was not denied by any of 30. the other justices. This was before the 9 & 10 W. III. And even Lord Holt, A. D. 1702, said, "all the difference between foreign and inland bills is, that foreign bills must be protested before a public notary before the drawer may be charged, but inland bills need no protest." Many other cases shew, that inland bills were assignable independent of any statutes, so as to enable the assignee to sue in his own name, 3 Wooddethough there no doubt was a time when the law merchant was son 109, Maviewed "as confined to cases where one of the parties was a lynes. Marius. merchant stranger." Probably as late as 1640 or 1650. Сн. 24. 6 Mod 29, 31, Buller v. Crips, and many authorities cited. Com. Dig. F. 1, F. 2, to 75. § 5. But if A made his money note, therein promising to pay £10 to B or to his order, and B endorsed it to C, could C in his own name sue A as maker, or B as endorser, independent of any statute? This was the litigated question which produced the said 3 & 4 of Anne. In this case, Buller v. Crips, the note was in this form, "I promise to pay J. S. or order the sum of £100 on account of wine had of him." J. S. endorsed this note to another, the plt., he brought the action against the maker, and declared on the custom of merchants as upon a bill of exchange. Motion in arrest of judgment. Lord Holt said, such notes were "only an invention of the goldsmiths of Lombard street, who had a mind to make a law to bind all that did deal with them." The opinion of the court appeared to be for arresting the judgment, and that the endorsee might have sued in the endorser's name; and that these notes are not in the nature of bills of exchange. Comyns speaks of a bill of debt without seal, that bound the merchant to pay money at such a day. And such a bill bindeites Ma. 71 ing without seal was by the custom of merchants, and so without witness or delivery might be made payable to bearer and on demand; so it might be made and subscribed by the merchant's servant. So a bill of debt to a person certain, might be assigned to another toties quoties. He then refers to the 3 & 4 of Anne. Some think this bill of debt described by Malynes, p. 75, and noticed by Comyns, was a money note so assignable as to enable the endorsee to sue in his own name. But this is very questionable, and for two reasons among others. 1. Malynes describes a material feature in this bill of debt, never it is conceived a part of the English or our money note; for Malynes says, if a bill of debt be signed by two or more as principals, each is bound by the custom of merchants only for his part. 2. He made his bill of debt rest on the custom of merchants. Salk. 129, Clerk Martin. 1 Anne. 757. 6. The modern doctrine is, "that before the statute of Anne, promissory notes were not assignable, or endorsible over within the custom of merchants, so as to enable the endorsee to bring an action in his own name against the maker." Though this doctrine is general, it is not universal. There are decisions both ways. 7. Decisions in support of this doctrine. The deft. gave to the plt. a note by which he promised to pay to him so much Same case 2 money or to his order. The plt. sued the note and declared Ld. Raym. on the custom of merchants, also laid a general indebitatus assumpsit. On the general issue entire damages were given; and on a motion in arrest of judgment, held by the court (B. R.) that this is not within the custom of merchants, and being no specialty, no action can be grounded on it." And the 66 marginal note is, "action lay not on a promissory note before the statute." In this case, as the action was brought by the promisee, the question as to negotiability could not arise. But as held, the promisee could not sue on the custom of merchants; quære, if an endorsee could. In this case, as cited in Lord Raymond, Holt is made to say, that in Horton v. Coggs it had been held, that such a note was not a bill of exchange within the custom of merchants, and that this promise was not sufficient in law to raise a promise." 66 Cн. 24. Art. 4. Potter v. Pearson. 8. Error of a judgment in the Common Pleas, on a like Salk. 129, note. The plt. declared there was a custom in London among merchants trading there, that if a merchant signed a note, 1 Anne. promising to pay to J. S. or order &c., he became bound by the custom of merchants to pay &c. Judgment reversed, which had been given for the plt. And Holt C. J. said, "this custom to oblige one to pay by note without consideration is void and against law." Same case 2 Ld. Raym. 759. § 9. In this case on a motion in arrest of judgment the de- Burton v. cision was, as in Clerk v. Martin, that such a note is not within Souter, 2 Ld. Raym. 774.-the said custom; but that the declaration ought to be on a 1 Anne. mutuatus, and the note given in evidence; for the rule is ex nudo &c., as in Potter v. Pearson, and the whole court recognised Clerk v. Martin as law. Farr. 154, 155. -Same 10. This was error from the C. B., two counts: 1. On the Williams v. said custom on a note given by the deft. to the plt. and pro- Cutting, mising to pay him so much money: 2. Indebitatus assumpsit. Several damages assessed. But only one judgment assigned case 2 Ld. for error, that the count on the custom, was void, and the Raym. 825, judgment was reversed in toto. And Holt C. J. said, "all the judges were of opinion, that a declaration on the custom of merchants on a note subscribed by the deft. to the plt. for so much money, or promising so much money was void; for it tended to make a note amount to a specialty." And Buller v. Crips, above, was decided 2 Anne. In this case, and in this only Buller v. of all these cases, did the endorsee bring the action. And Holt Crips. C. J. added, (in Buller v. Crips) and sure to allow such note to carry any lien with it were to turn a piece of paper, which is in law but evidence of a parol contract, into a specialty, and besides to empower one to assign that to another which he could not have himself; for since he to whom this note was made could not have this action, how can his assignee have it? And he said further, that these notes are not in the nature of a bill of exchange, and that if" endorsee had brought this action against the endorser it might peradventure lie, for the endorsement may be said to be tantamount to drawing a new bill for so much money as the note is for, upon the person that gave the note, or he may sue the first drawer in the name of CH. 24. 3 & 4 of Anne. the endorser to the endorsee's use; but it is observable this action by the endorser, that is, payee, against the drawer of the note, is precisely that of Clerk v. Martin &c. § 11. Soon after the decisions in these cases, and some others less important, and many dictums and arguments on this subject, the English parliament enacted the 3 & 4 of Anne, before cited, chapter 20, art. 3; this statute recited, that it has been held that money notes are not negotiable, so as that the assignee may sue in his own name, and then provided for their being negotiable when payable to order or bearer &c. This statute has a very important bearing on this subject, though not absolutely considered such notes as not negotiable so as &c. It is fairly to be supposed, that if parliament understood that those decisions were wrong, above stated, it would have left them to be corrected by after decisions, and that it would not have interfered. But from the recitals in, and the enactments of that statute, it is fairly to be inferred, that parliament thought negotiable money notes were very useful in the then increasing extension of trade, and that by the strict rules of law they were not negotiable; at any rate it was doubtful if they were, and therefore it enacted a statute expressly making them negotiable as bills were. Also it will be observed, that act considered these notes not negotiable in their nature, as well as not within the custom of merchants, and so they have been generally considered since in their nature unaided by any statute, and on this ground was Mandeville v. Riddle decided. Ch. 20, a. 10, s. 16. For if the note in that case had been negotiable in its nature, and in virtue of the authority given in it, there was nothing in the statute of Virginia to take away this its negotiability. And if so, then an endorsee might have recovered against a remote endorser on a proper count, but the contrary in that case was held by Dunlop v. the Supreme Court of the United States. And, therefore, Silver & al indirectly disapproved of the decision made in favour of such negotiability of money notes in their nature in Dunlop v. Silver & al. by two of the judges in the Circuit Court in the district of Columbia, against the opinion of Judge Marshall, about a year before the decision in Mandeville v. Riddle. It is true in Mandeville v. Riddle, there was only indebitatus assumpsit for money had &c. which lies only between privies, the endorsee, and his immediate endorser. But if understood, the note was in its nature negotiable as a bill is, no doubt another count would have been added. 1 Cranch 367, to 461. Malynes 71 to 76. 12. Malynes in his lex Mercatoria, published A. D. 1686, speaking of bills of debt among merchants, traders, and others, says expressly, that "the common law of England is directly against this course; for they say there can be no alienation from one man to another of debts; because they are held choses in action, and such whereof no property can pass by assignment or alienation, and many good lawyers, as well as merchants, do wish that there were an act of parliament made for establishing a like course in England;" that was, to make bills of debt negotiable there, as they were in Amsterdam, Middleborough, Hamburgh, &c. Malynes then wrote two chapters to shew the manner of bills beyond the seas, the setting over of bills of debt, (and his given form of one contained value received in merchandise &c.) as to selling these bills obligatory, as he calls them, (though he annexes no seal or witness to his prescribed form,) and the general benefits in assigning them being made payable to bearer. And further, Malynes proposed to establish in England the usage of these bills of debt, and so implying clearly, that about nineteen years before the said 3 & 4 Anne they were not much used in England; he says, also, in the Eastern countries, and sometimes in the Low countries, they put seals to them, and then a delivery was understood of course, and also that it was necessary to express in them what they received, whether merchandise, money, or what kind of consideration. Pretty clearly such a contract was new as a legal one in English practice in the courts of law. So no ground for supposing as some do, that this bill of debt mentioned in English books, was the same as the English and our money notes. As the law merchant had its rise in the civil law and in foreign ordinances, which were long received with much reluctance in England, this law merchant gained ground there slowly in all respects, except in regard to foreign or outland bills of exchange, and matters in which foreign merchants were concerned; hence, slowly in regard to inland bills, and very slowly if at all in regard to promissory notes. And since the 3 & 4 of Anne this law merchant has not been required to aid them; as that statute, as Lord Mansfield observed in Grant v. Vaughan, 3 Burr. 1516 &c., put notes payable to order or bearer, merely upon the footing of inland bills of exchange. Even in this case A. D. 1764, a plain inland bill is repeatedly called a note, also a cash note: the same footing per Wilmot J. 13. Decisions against this doctrine, and tending to prove promissory notes were held to be within the custom of merchants as inland bills of exchange were. 1 Cranch 415 it is said, we find before the statute of Anne, "that it never was adjudged that a promissory note for money payable to order, and endorsed, was not an inland bill of exchange." "But we find that the contrary principle has been recognised in all the cases from the time of the first introduction of inland bills and pro CH. 24. Art. 4. |