First National Bank v. Clark

Robinson, J., delivered the opinion of the Court. D. N. Ulm & Co. were engaged in the business of buying and shipping grain at Flora, Illinois; and the appellee was their correspondent in Baltimore. On the 22nd of September, 1882, Ulm & Co. wrote to the appellee for permission to draw on him for $1500, to which he replied by telegram as follows: (No. 1.) “ Baltimore, Sept. 26, ’82. “ On account of decline, you can draw on us for $750 ; will sell spot; hold steamer; is our action satisfactory ? “Thos. S. Clark & Sons.” To this Ulm & Co. at once replied: (No. 2.) “ Flora, Sept. 26, ’82. “No. Allow draft as required, or turn over bills.

Answer quick. D. N. Ulm & Co.” ⁴⁰⁵ The appellee then telegraphed: (No. 3.) “ Baltimore, Sept. 26, ’82. “ Cannot allow draft; market cent higher than close; cannot turn over shipment; will sell to best advantage. “Thos. S. Clark & Sons.” To this Ulm & Co. replied: (No. 4.) “Will draw on you for $150; it is not satisfactory.” And the appellee answered: (No. 5.) “Market higher; do not draw for $150. Account will not stand it.” After sending telegram No. 2, and receiving telegram No. 3, in the above series, Ulm & Co. exhibited to the cashier of the appellant the telegram marked No. 1, and drew a sight draft for $150 on the appellee, which was discounted by the appellant.

This draft the appellee refused to pay. Upon these facts two questions arise, and first, is the appellee liable as acceptor ¶ That one may be liable as acceptor of a bill, drawn in pursuance of a written promise to accept, and upon the faith of which the holder has advanced money, is well settled in this State. Lewis vs. Kramer & Ralm, 3 Md., 265 ; Franklin Bank of Baltimore vs. Lynch, 52 Md., 210 . In such cases, however, it is necessary that the bill should be drawn within a reasonable time after the promise is made, for otherwise the drawer will be presumed to have declined to act on the authority thus given, and the drawees will not be construed to have intended an indefinite liability.

And second, the promise must so describe the bill, that there can be no doubt of its application to it. This was so expressly held in Coolidge vs. Payson, 2 Wheaton, 66 , and held too, upon the authority of Pillans & Rose vs. Van Mierop & Hopkins, 3 Burr., 1663; Pierson vs. Dunlop, ⁴⁰⁶ et al., Cowp., 571, and Mason vs. Hunt, Doug., 296. These cases were, it is true, somewhat questioned in Johnson vs. Collings, 1 East, 98, and Clarke, et al. vs. Cock, 4 East, 57, Lord Kenyon saying, that the Court had in these cases carried “the doctrine of implied acceptances to the utmost verge of the law; and he doubted whether it did not even go beyond the proper boundary.” . And when the question arose in Bank of Ireland vs. Archer, 11 Mees. & Wels., 382, decided in 1843, on a parol promise to accept, Baron Park held, such promise did not amount to an acceptance, although the bill was discounted for the drawer on the faith of the promise.

The question was set at rest-fin England by Statute 19 & 20 Vict., ch. 97, sec. 6, which provided that no one should be bound as acceptor unless the acceptance be written on the bill and signed by the acceptor, or by some one authorized by him. In this country, however, the Courts have generally held to the doctrine of implied acceptance, as laid down by the Supreme Court in Coolidge vs. Payson, being careful at the same time not to enlarge it, for the reason that such acceptances must necessarily affect the credit of bills and impair their commercial value. And accordingly in Franklin Bank of Baltimore vs. Lynch, 52 Md., 280 , where the drawer was authorized by a telegram received late on Saturday to