Wangner v. Grimm

• Decision Date: 14 January 1902
• Citation: 169 N.Y. 421,62 N.E. 569
• Parties: WANGNER v. GRIMM.
• Court: New York Court of Appeals Court of Appeals

169 N.Y. 421

62 N.E. 569

WANGNER

v.GRIMM.

Court of Appeals of New York.

Jan. 14, 1902.

Appeal from supreme court, appellate division, Third department.

Action by Georgianna Wangner, administratrix of Amelia S. Grimm, against Paul Grimm. From a judgment of the appellate division (65 N. Y. Supp. 1134) affirming a judgment in favor of plaintiff, defendant appeals. Affirmed.

Henry J. Speck, for appellant.

Charles E. Patterson and Benjamin E. De Groot, for respondent.

MARTIN, J.

On March 10, 1890, Fred M. Grimm, the husband of the plaintiff's intestate, who was conducting business in the city of Troy, N. Y., entered into an agreement with the defendant by which he sold and transferred to him his business for the consideration of $7,000, of which $3,000 was paid in cash, and the remaining $4,000 was secured by four notes, of $1,000 each, dated, respectively, April 10, May 10, June 10, and July 10, 1890, each to become due 30 days after its date. They were all made payable to the order of Fred M. Grimm, and delivered to him. Soon after, and in the following month, he entered into an agreement with Philip F. Wangner, the father of the intestate, by which he sold and transferred to Fred certain premises owned by him (Wangner), for the consideration of $12,000, in part payment of which Fred delivered to Wangner the four notes, of $1,000 each, given to him by the defendant. At the conclusion of that transaction Wangner gave and delivered to the intestate one of those notes, which, although payable to the order of F. M. Grimm, was not indorsed by him.

About that time, at the house of his mother, the defendant and the intestate met, and while there she informed him that her father, to whom his notes had been transferred, had given her one of them, and the defendant thereupon congratulated her upon the gift from her father, remarking that it was a nice present, and that she now had $1,000 in her own right. After the gift to the intestate that note remained in her possession for about one year, when her husband informed her that the defendant wanted to renew it, and she authorized him to have it renewed, which was done. The note in suit was the renewal note made upon that occasion, which was at once deliversed to the intestate, and remained in her possession until the commencement of this action. It was for $1,000, payable four months after date to the order of F. M. Grimm, and dated April 16, 1891. There was no positive proof that the defendant had any knowledge of the delivery of the renewal note to the intestate, although there was proof from which the jury was justified in finding that he knew that the note in suit was given to renew a note of which the intestate was the owner and holder. There was sufficient evidence to justify a finding that the defendant paid the note in suit to the payee thereof during the lifetime of the latter, but it was insufficient to conclusively establish that fact. Although there was a conflict in the evidence as to some of the facts stated, still, as the jury found in favor of the plaintiff, they must be regarded as established by its verdict.

Upon the trial considerable evidence was given by both parties, and the court submitted to the jury three questions for its determination, which in effect were: (1) Did her father give the intestate one of the original notes which the note in suit was given to renew? (2) Did the defendant, before any payment was made on the note, have notice that the intestate was the owner of the original note given to her by her father? And (3) did the defendant during the year 1892 pay Fred Grimm $1,000 upon the debt secured by the note in suit without notice that the intestate was the owner of it? The jury rendered a general verdict in favor of the plaintiff for the amount of the note and interest thereon. At the close of the evidence the defendant failed to move for a nonsuit or for the direction of a verdict.

Although the decision by the appellate division (65 N. Y. Supp. 1134) cannot be regarded as unanimous, as one of the justices sitting did not vote (Warn v. Railroad Co., 163 N. Y. 525, 57 N. E. 742), yet much of the appellant's discussion is not available upon this appeal for the reason that the record fails to show any proper exception by which the questions argued are presented. The jurisdiction of this court is limited to the review of questions of law. Code Civ. Proc. § 191. We can review only such legal questions as are raised on the trial by a proper exception. Wicks v. Thompson, 129 N. Y. 634, 29 N. E. 301. No objection not so taken can be considered by us. Serviss v. McDonnell, 107 N. Y. 260, 265,14 N. E. 314;Sullivan v. Dunham, 161 N. Y. 290, 300,55 N. E. 923,47 L. R. A. 715, 76 Am. St. Rep. 274. As we have already seen, at the close of the evidence the defendant omitted to move either for a dismissal of the complaint or for the direction of a verdict in his favor. The legal effect of this was to consent to the submission of the case to the jury. Moreover, the defendant having subsequently proceeded with the case and put in evidence on his part, he waived any exception taken by him to the ruling of the court refusing to dismiss the complaint at the close of the plaintiff's evidence. Hecla Powder Co. v. Sigua Iron Co., 157 N. Y. 437, 52 N. E. 650;Pollock v. Iron Works Co., 157 N. Y. 699, 51 N. E. 979;Hopkins v. Clark, 158 N. Y. 299, 53 N. E. 27;Littlejohn v. Shaw, 159 N. Y. 188, 191,53 N. E. 810;Ross v. Caywood, 162 N. Y. 259, 265,56 N. E. 629.

This leaves for our consideration only such questions as were properly raised by exception to the rulings upon the trial or to the charge of the learned trial court. On the trial the judge charged the jury that, ‘if the defendant knew that the original paper of which this note is a renewal belonged to the plaintiff, then he is held in law to know that this renewal paper was the property of the plaintiff, there being no evidence anywhere that he ever was informed that the renewal paper or the original paper had changed hands from the plaintiff to Fred Grimm or to any one else. Of course, this rests upon the question as to whether he had notice that the original paper belonged to the plaintiff.’ To this portion of the charge the defendant excepted. Thus the question is presented whether, assuming that the defendant knew that the debt which was secured by the original note which the note in suit was given to renew belonged to and was the property of the plaintiff's intestate, that knowledge applied to the renewal note so that a payment of the debt thus secured was a payment with such notice as to render it ineffectual as against her.

Before considering the correctness of this instruction, it is necessary to determine the relation which existed between the plaintiff's intestate and the maker of the note, which was not transferred to her in due course by the indorsement of the payee, but by a gift and delivery thereof. It is well settled in this state and elsewhere that the owner of negotiable paper, who obtains title without indorsement by the payee, holds it subject to all the equities and defenses which exist between the original parties. Where such an instrument is so transferred, it is treated as a chose in action assigned to the holder, and the assignee acquires all the title of the assignor, and may maintain an action thereon in his own name. While, like other assigned choses in action, it is subject to all the equities and defenses existing in favor of the maker, including the payment of the note to the payee if the payment is made without notice of the title of the holder, still, when a debtor has notice of the assignment, he may not thereafter make a valid payment to the assignor. Bank v. Bingham, 118 N. Y. 349, 354,23 N. E. 180, 7 L. R. A. 595, 16 Am. St. Rep....