Colthurst v. Lake View State Bank

• Decision Date: 14 April 1927
• Docket Number: No. 7466.,7466.
• Parties: COLTHURST v. LAKE VIEW STATE BANK OF CHICAGO, ILL.
• Court: U.S. Court of Appeals — Eighth Circuit

18 F.2d 875 (1927)

COLTHURST v. LAKE VIEW STATE BANK OF CHICAGO, ILL.

No. 7466.

Circuit Court of Appeals, Eighth Circuit.

April 14, 1927.

Edmund D. Morrison, of Washington, Iowa (Frank A. Cooper, of Davenport, Iowa, on the brief), for plaintiff in error.

S. W. Livingston, of Washington, Iowa (E. C. Eicher, of Washington, Iowa, on the brief), for defendant in error.

Before KENYON, Circuit Judge, and MOLYNEAUX and OTIS, District Judges.

OTIS, District Judge.

April 19, 1924, the Lake View State Bank of Chicago, an Illinois corporation, herein referred to as the plaintiff, filed in the District Court for the Southern District of Iowa its petition, thereafter amended, in which, as amended, it alleged it was the holder in due course, for value, and without notice of any defense thereto, of a note in the principal amount of $3,200, with interest at 6 per cent., dated December 16, 1918, due in one year, and signed by the plaintiff in error, herein referred to as the defendant. The answer charged procurement of the note by fraud and denied that the bank held it in due course.

Upon the trial, having heard the testimony offered by the plaintiff to the effect that it had purchased the note February 20, 1919, for $3,234.67 (being the principal plus the interest then due) from the then holder, one W. F. Van Buskirk, to whom the note had been indorsed by a prior indorsee, and that it had no knowledge of any defenses existing in favor of the maker of the note, the District Court directed the defendant to put on his evidence in this order: First, any evidence he had tending to show that the bank was not a holder in due course and without notice; and, second, after such evidence (but not otherwise) any evidence he had tending to show that the note in the first instance was obtained by fraud.

Upon the first of these issues the defendant offered two exhibits, letters written by Van Buskirk, one dated February 4, 1920, and the other February 25, 1920, addressed to the defendant, received by him through the mails, and demanding payment to him, Van Buskirk, of the amount due on the note. These letters were written after the maturity of the note, and were offered on the theory that they tended to show that Van Buskirk and not the bank was the owner of the note when the letters were written, and that the bank did not obtain the note before maturity, and therefore not in due course. These letters the court excluded.

The District Court directed a verdict for the plaintiff. It is contended that the court erred therein, first, because the Van Buskirk letters showed that the bank did not receive the note before maturity and therefore was not a holder in due course; second, because, even if the Van Buskirk letters properly were excluded, facts and circumstances in evidence tended to show the bank was not a holder in due course; and, third, because, in any event, it was for the jury to pass upon the credibility of the witnesses for the plaintiff.

1. The Van Buskirk letters were properly excluded as hearsay. It would have been relevant and material to prove that Van Buskirk and not the bank was the holder of the notes at and after their maturity, but that...