L. 1909, ch. 43 Liabilities of Parties § 116 latter contingency it is coupled with proof that he was damaged by such failure to notify him within a reasonable time." Oppenheim v. West Side Bank, (1898) 22 Misc. 722, 50 N. Y. S. 148. Alteration after indorsement. The warranty provided in this section applies only to the instrument in the form it leaves the hands of the indorser; if it is subsequently altered by the maker the warranty does not apply to the instrument as altered. Brooklyn First Nat. Bank v. Gridley, (1906) 112 App. Div. 398, 98 N. Y. S. 445. If the amount of a note is raised after the indorsement the indorser is not liable for the increased amount, although there may have been left in the face of the note spaces which facilitated the raising of the instrument. National Exch. Bank v. Lester, (1909) 194 N. Y. 461, 87 N. E. 779, 16 Ann. Cas. 770, 21 L. R. A. (N. S.) 402. Usury. The fact that an instrument is usurious as between the original parties is not a defense which an indorser of the instrument may urge as against his indorsee. Horowitz v. Wollowitz, (1908) 59 Misc. 520, 110 N. Y. S. 972; Klar v. Kostiuk, (1909) 65 Misc. 199, 119 N. Y. S. 683. But where the indorser is also the maker of the instrument, no strength is added to the instrument by his indorsement. Sabine v. Paine, (1915) 166 App. Div. 9, 151 N. Y. S. 735. And if the holder has knowledge of the usury he is not a holder in due course under section 91 and thus cannot avail himself of this section. Kass v. Blumberg, (1913) 142 N. Y. S. 544. Executor. An executor or administrator who indorses or accepts negotiable paper does not bind the estate, but is liable individually. Schmittler v. Simon, (1886) 101 N. Y. 554, 5 N. E. 452, 54 Am. Rep. 737. An indorsement by one of several executors does not bind the estate. Union Bank v. Sullivan, (1915) 214 N. Y. 332, 108 N. E. 558. Liability to maker. The indorser is not liable on the note to a holder who is a maker; if the holder was an accommodation maker for the benefit of the indorser whose proper debt it was to pay, the maker has his remedy in an action for money paid. Abramowitz v. Abramowitz, (1908) 113 N. Y. S. 798. Indorsement fraudulently obtained. An indorsemment which is obtained by fraud will bind the indorser if the note has passed into the hands of a holder in due course. Clothier v. Adriance, (1873) 51 N. Y. 322. Statute of limitation in action by accommodation indorser against maker. -A payee and indorser of a note for the accommodation of the maker, is, as between such parties, a surety of the maker; and the maker impliedly engages that he will indemnify the payee and reimburse him in case he is compelled to pay. This engagement on the part of the maker is not created by the note; the failure of the maker to pay the note does not create a cause of action in favor of the accommodation payee, but a payment by such payee to the holder does. Hence, the statute of limitations in an action by the payee against the maker does not commence to run at the maturity of the note, but only at the date of the payment to the holder. Blanchard v. Blanchard, (1911) 201 N. Y. 134, 94 N. E. 630, 37 L. R. A. (N. S.) 783. Parol evidence. As between the original parties the apparent rights of the indorser of a note and his contract of indorsement may be qualified by parol evidence so as to establish the intent of the parties. Witherow v. Slayback, (1899) 158 N. Y. 649, 53 N. E. 681, 70 A. S. R. 507. Thus the maker may show that he signed the note as an accommodation party for the benefit of the indorser. Abramowitz v. Abramowitz, (1908) 113 N. Y. S. 798. Failure of holder to apply maker's fund to payment of note.-The fact that after the maturity of a note held by a bank the maker had a deposit in the bank sufficient to pay it and the bank did not appropriate the deposit for that purpose, does not release the indorser on the note, in the absence of any direction or agreement that the bank should use such fund for the satisfaction of the note. Far Rockaway Bank v. Norton, (1906) 186 N. Y. §§ 117, 118 Liabilities of Parties L. 1909, ch. 43 484, 79 N. E. 709. Under such circumstances it is optional with the bank whether it will apply the money or not, and there is no positive legal obligation so to do. National Bank v. Smith, (1876) 66 N. Y. 271, 23 Am. Rep. 48. Offset by indorser. In an action against an indorser of a note held by a bank at the time of its insolvency, the indorser may set off moneys he had on deposit in the bank at the time of the failure. Carnegie Trust Co. v. Kistler, (1915) 89 Misc. 404, 152 N. Y. S. 240. When sued, the indorser stands for the purpose of the action in the same position as the maker except that he is absolutely liable upon the note. In such an action against him he may set off against his obligation as indorser any debt which the holder of the note may owe to him. In this respect the maker and indorser stand in the same position. The allowance of such a set-off is not a direct preference, because there are mutual demands and the amount of the debt from one to the other is the difference between these mutual demands. The fact that the indorser may, if the maker is solvent, be indemnified by him in addition to being allowed to set off the amount of his deposit against the insolvent holder, does not preclude the indorser's right of set-off. The possibility of a preference thus resulting to the indorser is speculative and uncertain. Curtis v. Davidson, (1915) 215 N. Y. 395, 109 N. E. 481. Cited. Gilpin v. Savage, (1911) 201 N. Y. 167, 99 N. E. 656, Ann. Can 1912A 861, 34 L. R. A. (N. S.) 417; Yonkers Nat. Bank v. Mitchell, (1913) 156 App. Div. 318, 141 N. Y. S. 128. § 117. Liability of indorser where paper negotiable by delivery. Where a person places his indorsement on an instrument negotiable by delivery he incurs all the liabilities of an indorser. This section was derived from the Negotiable Instruments Law of 1897, § 117. § 118. Order in which indorsers are liable. As respects one another, indorsers are liable prima facie in the order in which they indorse; but evidence is admissible to show that as between or among themselves they have agreed otherwise. Joint payees or joint indorsees who indorse are deemed to indorse jointly and severally. This section was derived from the Negotiable Instruments Law of 1897, § 118. Prior rule. This section is substantially a re-enactment of the law as previously established by the decisions. Haddock v. Haddock, (1907) 118 App. Div. 412, 103 N. Y. S. 584, affirmed (1908) 192 N. Y. 499, 85 N. E. 682, 19 L. R. A. (N. S.) 136. Note by second indorser to first indorser.-Where a second indorser on an instrument gives a promissory note to the first indorser as a consideration for taking up and paying the instrument by such first indorser the note is not based on a good consideration. Manhattan Glass Co. v. Gilman, (1897) 20 Misc. 690, 46 N. Y. S. 685. Rebuttal of order of liability. As between the original parties, the apparent rights of the indorser of a note and his contract of indorsement may be qualified by parol evidence so as to establish the intent of the parties. Witherow v. Slayback, (1899) 158 N. Y. 649, 53 N. E. 681, 70 A. S. R. 507. The maker of a note may show that an apparent indorser is in fact a principal L. 1909, ch. 43 Liabilities of Parties 8 119 debtor. Witherow v. Slayback, (1899) 158 N. Y. 649, 53 N. E. 681, 70 A. S. R. 507. See also Abramowitz v. Abramowitz, (1908) 113 N. Y. S. 798. Where by agreement between a prior and a subsequent holder of a note the latter is to be liable on his indorsement to the former, upon a retransfer of the note the agreement is binding and will be enforced. Hubbard v. Matthews, (1873) 54 N. Y. 43, 13 Am. Rep. 562. Indorsers as co-securities. In an action on a promissory note by one indorser against a prior indorser, it is competent to admit parol evidencce to show an agreement between all the indorsers that as between themselves they were to be co-sureties. Easterly v. Barber, (1876) 66 N. Y. 433. The presumption is that indorsers are liable in their order, but this presumption may be rebutted by evidence that the parties had otherwise agreed among themselves; and it is not necessary that there be proof of an actual formal contract of such an agreement. It is sufficient if the surrounding circumstances indicate that the indorsements were made upon the understanding that all the indorsers were to participate in the liability. Thus, where a note is indorsed before delivery to the payee, to enable a stranded theatrical company to raise funds to get home, the presumption is overcome, and a prior indorser may maintain an action against subsequent indorsers for contribution. George v. Bacon, (1910) 138 App. Div. 208, 123 N. Y. S. 103. Where the stockholders and indorsers of a corporation become the accommodation indorsers of its negotiable paper with a view of protecting their financial interests, the presumption which arises from the order of the names of indorsers, if not overcome as a matter of law, is sufficiently overcome to raise a question of fact whether it was not the intention of the parties to become jointly liable to one another according to the respective indorsements. Strasburger v. Strasburger, (1915) 167 App. Div. 198, 152 N. Y. S. 757. In an action at law by one accommodation indorser of a note who has been compelled to pay the amount thereof against three other accommodation indorsers, they having agreed to be liable as co-sureties, the plaintiff is entitled to recover from each one-fourth of the amount, but in an action in equity for contribution he would be entitled to recover one-half from one of such co-sureties on proof of the insolvency of the other two. Easterly v. Barber, (1876) 66 N. Y. 433. Two accommodation indorsers. In the absence of an agreement between two accommodation indorsers that they shall be liable between themselves as co-sureties, they are liable in the order their names appear; and, if the latter pays the instrument and takes it up, he is entitled to recover the full amount thereof from the prior indorser. Kelly v. Burroughs, (1886) 102 N. Y. 93, 6 N. E. 109. Where the maker and indorser of a promissory note are both accommodation parties, the position of the parties upon the paper raises a presumption that the second indorser put his name upon the note on the faith of the signature of the payee and the maker, but this presumption may be rebutted by circumstances. Moynihan v. McKeon, (1896) 16 Misc. 343, 38 N. Y. S. 61. Liability of irregular indorser.—An irregular indorser is prima facie liable under section 114 to the payee of a note, but parol evidence is admissible to show that as between themselves the parties have agreed otherwise. Haddock v. Haddock, (1907) 118 App. Div. 412, 103 N. Y. S. 584, affirmed (1908) 192 N. Y. 499, 85 N. E. 682, 19 L. R. A. (N. S.) 136. Action against one of joint indorsers. An action lies against one of several joint indorsers, individually, for under this section joint indorsers are deemed to indorse jointly and severally. Hodgens v. Jennings, (1912) 148 App. Div. 879, 133 N. Y. S. 584. Cited State Bank v. Kahn, (1906) 49 Misc. 500, 98 N. Y. S. 858. § 119. Liability of agent or broker. Where a broker or other agent negotiates an instrument without indorsement, he incurs all $ 119 Liabilities of Parties L. 1909, ch. 43 the liabilities prescribed by section one hundred and fifteen of this chapter, unless he discloses the name of his principal, and the fact that he is acting only as agent. This section was derived from the Negotiable Instruments Law of 1897, § 119, as amended by L. 1898, ch. 336, § 10. Indorsement in representative capacity: see supra, § 74. Signature of instrument by agent: see supra, §§ 38, 39. Liability of person signing as agent: see supra, § 39. Executor. An indorser or administrator who indorses or accepts commercial paper does not bind the estate, but he is liable individually. Schmittler v. Simon, (1886) 101 N. Y. 554, 5 N. E. 452, 54 Am. Rep. 737. An indorsement by one of several executors does not bind the estate. Union Bank v. Sullivan, (1915) 214 N. Y. 332, 108 N. E. 558. Liability of agent.-An agent who sells commercial paper as his own warrants his title thereto and that the instrument is genuine. Meriden Nat. Bank v. Gallaudet, (1890) 120 N. Y. 298, 24 N. E. 994. Presentment for Payment L. 1909, ch. 43 § 180 ARTICLE 8 PRESENTMENT FOR PAYMENT Section 130. Effect of want of demand on principal debtor. 132. What constitutes a sufficient presentment. 134. Instrument must be exhibited. 135. Presentment where instrument payable at bank. 138. Presentment to joint debtors. 139. When presentment not required to charge the drawer. 140. When presentment not required to charge the indorser. 141. When delay in making presentment is excused. 142. When presentment may be dispensed with. 143. When instrument dishonored by non-payment. 144. Liability of person secondarily liable, when instrument dishonored. 145. Time of maturity. 146. Time; how computed. 147. Rule where instrument payable at bank. 148. What constitutes payment in due course. § 130. Effect of want of demand on principal debtor. Presentment for payment is not necessary in order to charge the person primarily liable on the instrument; but if the instrument is, by its terms, payable at a special place, and he is able and willing to pay it there at maturity and has funds there available for that purpose, such ability and willingness are equivalent to a tender of payment upon his part. But except as herein otherwise provided, presentment for payment is necessary in order to charge the drawer and indorsers. This section was derived from the Negotiable Instruments Law of 1897, § 130, as amended by L. 1898, ch. 336, § 11. When presentment not required to hold drawer: see infra, § 139. When presentment not required to hold indorser: see infra, § 140. Discharge of |