The maturity of a draft reading so many days, or months, after date must be calculated from the date of the draft itself. But the maturity of a draft reading so many days, or months, after sight must be calculated from the date it was presented to the sight of the payer and accepted. It is very necessary to date acceptances of time drafts reading "after sight."
Demand for payment must be made at the proper place during business hours. A check of course is payable at the bank on which it is drawn, during banking hours. A draft on a firm is payable at its office; likewise a draft on an individual is payable at his office, or if he has none, then at his residence. Notes or accepted drafts are payable at the place stated on their face. But, when no place of payment is stated, demand for payment must be made at the office of the maker of the note, or the acceptor of the draft; or if he has no office, then at his residence. When you draw up a note it is the proper thing to state on its face "payable at —— bank" (giving the name of your bank); or "payable at my office"; or "payable at my residence."
Likewise, when accepting a draft, write the date, then "accepted, payable at ——" (stating your bank, or residence) across the face of the draft over your signature. Therefore when a note, or an accepted draft is made payable at a certain bank, demand for payment must be made at that bank, and not on the maker of the note, or the acceptor of the draft. Most notes and accepted drafts are made payable at the bank of the payer. All of them should be. In this way, if you keep money enough in your bank to meet your notes and acceptances, just as you keep money there to meet your checks, the bank will save you all worry about their payment in case you or your bookkeeper overlook them. Under such circumstances your paper would never be protested.
In accepting a note from a customer, do not have it made payable at your bank. Have the drawer make it payable in his own town and at his own bank. Demand for payment must be made at the exact place stated in the note. As every business man is particular about protecting his credit in his own town, and especially at his own bank, it is obvious that he will be most diligent about providing for the payment of paper made payable at the bank with which he is doing business.
Notes and accepted drafts should be sent, a week or two in advance of their maturity, to the town in which they are made payable. If paper, made payable at New Orleans, for instance, is not in New Orleans when due, proper demand for payment can not be made and the drawers or endorsers might be released.
There is absolutely no law requiring a bank to send you a notice that it holds your note, or draft accepted by you, for collection and due at some future date. It is customary for banks to send such notices, but it is only a courtesy. It is your duty to keep account of when your paper is due, and to have funds at the place of payment when it is due. The banks that do so are very careful about sending out these notices, but the public should regard it as a favor shown them and not as their lawful right. Many people do not know or appreciate this fact. You should always put your street address just below your signature on a note so that notice can be addressed properly. Also, in drawing a draft, always put the name of the person or firm, on which it is drawn, in the lower left hand corner, and invariably state the street address.
XI
THE LOCAL COLLECTION DEPARTMENT
A bank has a perfect right to refuse to accept and to return any checks, notes, drafts, etc., sent it for collection. But if it does accept them, it must obey the instructions of the sender, literally and exactly. The bank has absolutely no right to disregard these instructions, no matter how obnoxious or disagreeable they may seem to the payer of the paper.
Many people regard all collectors as offensive and unwelcome. They wish to take their own time about paying their debts. Please mark this difference between the collector of your grocer's or druggist's bill, and the city bank as a collector of your note, or of a draft on you. The monthly collector must turn in cash for the majority of the bills given him or lose his position. But it really makes little difference to the bank whether you refuse or pay the note or draft that some other bank has sent it.
When collections are sent to a bank direct by firms, or by banks in another city, that do not keep an account with it; the collecting bank makes small fees, but these fees are very insignificant.