1. If a note be transferred before it is due, the endorsee will hold it freed from any dealings between the maker and payee, had before that time.
2. If transferred after it is due and dishonored, the maker is entitled to the same defenses against the endorsee, as he would have had against the payee.
(The case of Elliott v. Smitherman, 19 N.C. 338, cited and approved.)
NASH, C.J.
The action is brought on a promissory note. It was executed by defendant's testator, on 11 July, 1849, and payable on demand. The payee endorsed it to the plaintiff on 17 June, 1851, and demand was made on the 25th of the same month. The note was dishonored at the time of its endorsement, and subject, in the hands of the endorsee, to all the defenses it would have been, if still held by the endorser. There is no precise time established in law, within which a note payable on demand must be presented for payment, so as to protect an endorsee against the equities which the maker may have upon the payee or endorser. If transferred before dishonored, the endorsee will hold it freed from any dealings between the maker and payee had before that time; if after, he holds it as the payee did, and subject to all his liabilities upon it. When a note is made payable on demand, or (41) when no time of payment is expressed, it is payable instantly on demand, without any allowance of days of grace; and it must be presented for payment within a reasonable time after the receipt of it — Chit. on Bills, 269 — and if not so presented, the note will be dishonored. Bowler v. Jones, John. Rep., 203; Chit. on Bills, 127. What is reasonable time depends upon the circumstances of each case. Here the original parties lived in a mile or two of each other, and the note was not endorsed until near two years after its execution. It was then dishonored, and the defendant was entitled as against the plaintiff to the full benefit of his claims against Threadgill, the payee of the note. Elliott v. Smitherman, 19 N.C. 338.
In Winslow and Martin, 2 Mason, 141, a neglect in demanding a note payable on demand, for seven months, was held an unreasonable delay.
We see no error in the opinion of his Honor below, and the judgment is affirmed.
PER CURIAM. Judgment affirmed.
Cited: Caldwell v. Rodman, 50 N.C. 141; Capel v. Long, 84 N.C. 17; Ervin v. Brooks, 111 N.C. 359.