32 N.Y. 579, Farmers' Bank v. Maxwell

Citation:32 N.Y. 579
Party Name:THE FARMERS' BANK OF SARATOGA CO., Appellant, v. JOSHUA MAXWELL.
Case Date:June 01, 1865
Court:New York Court of Appeals
 
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Page 579

32 N.Y. 579

THE FARMERS' BANK OF SARATOGA CO., Appellant,

v.

JOSHUA MAXWELL.

New York Court of Appeal

June 1, 1865

Page 580

COUNSEL

William A. Beach, for the appellant.

I. The proposition that the note in suit is not transferable is founded upon the idea that as it is an insurance premium note, an assessment for losses was a prerequisite to its availability. Should that be conceded, that would not affect the negotiability of the paper. The indorsee would then take subject to that necessity. ( Marine Bank v. Vail, 6 Bosw., 421; Nelson v. Eaton [Court of Appeals], 6 Abb., 113.)

1. The question of assessment cannot affect the transferability of paper negotiable by its terms.

2. The necessity for an assessment must be derived from

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the terms of the note, or from the charter, and the law under which it was obtained. It does not follow from the circumstance that it was a note for an insurance premium. It is not a necessity inherent--natural to the instrument.

This note is payable absolutely and unconditionally; there is nothing, therefore, in the note requiring an assessment preliminary to payment.

3. There is nothing in the charter to that effect.

4. The law under which this company was organized, required no assessment, for it contains no provision on the subject. (See Act of 1849.)

II. This company might receive cash in lieu of a premium note; and where cash may be received in lieu of a premium note, an absolute promise to pay it is likewise receivable. The insured may give, and the company may receive, his check for cash; or a certificate of deposit; or, by parity of reasoning, a negotiable bank note.

III. The circumstance that the note was payable to an officer of the company, does not limit its negotiability. It was negotiable by the indorsement of the payee in his official character.

IV. Hence, it is immaterial whether or not the plaintiff was a bona fide holder of this paper. Not being liable to assessment, either because this was a stock company and could collect without it, or because the form of the promise dispensed with that formality, any holder, with or without notice of all the circumstances, could recover. And so, likewise, if the note was given and received as cash, under the special provisions of the charter.

John H. Reynolds, for the respondent.

OPINION

CAMPBELL, J.

The note was given on the day of its date, November 30, 1853, to the insurance company, in consideration of a policy of insurance that day issued. The note is not conditional in its terms, but is payable, absolutely, on a day certain and at a fixed place. It is an ordinary promissory note, and, so far as appears on its face, it may have been given to the company as well for money loaned as for a policy

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issued. On the 31st day of December...

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