Briggs v. Ewart

• Decision Date: 31 January 1873
• Citation: 51 Mo. 245
• Parties: JOHN D. BRIGGS, Respondent, v. DAVID EWART, Appellant.
• Court: Missouri Supreme Court

51 Mo. 245

JOHN D. BRIGGS, Respondent,

v.DAVID EWART, Appellant.

Supreme Court of Missouri.

January Term, 1873.

Appeal from Pettis County Common Pleas Court.

Phillips & Vest, for Appellant.

The paper sued on was not the note of Ewart, his mind gave no assent to its creation. Nor was he guilty of laches so as to bind him. Nor is genuineness of signature alone sufficient to bind him. (State Bank vs. McCay, Am. Law Times, April 1871, Vol. 4, pages 76, 79, 80; Whitney vs. Synder, reported in Albany Law Journal 7th January, 1871, No. 1, Vol. 3, p. 3; Foster vs. MacKinnon, 4 English, Com. Pl., 704; Awde vs. Dixon, 6 Exch. R., 869, 872.)

Snoddy & Bridges, for Respondent.

A party who signs a negotiable note upon the representations of another, taking it for granted that the paper is what it is represented to be, does so at his peril; and if an innocent purchaser obtains the same for value before maturity, and without notice, he can recover the amount of the note from the maker. All the authorities indicate that the maker of negotiable paper is not permitted to interpose any defense to a note in the hands of an innocent purchaser, except in cases where he is not chargeable with any laches or neglect or misplaced confidence in others; and where a blank is in the form of a note and is intrusted to another either through misrepresentation or otherwise, without any authority to fill the blanks, he is yet liable to a bona fide holder for value. (See leading case on this subject, Putnam vs. Sullivan, 4 Mass., 45.)

If Appellant signed the note on such false and fraudulent representations set forth in said instruction without examination for himself, he was guilty of negligence, and as a necessary consequence, in fault.

Even if the Respondent did sign the note upon which this suit is founded, believing that it was not a note, but under the impression that it was in reality a duplicate order, from the false and fraudulent representations of the payee in the note, it constitutes no defense to this action. Although a note be obtained by robbery or theft, and there is really no actual fault or negligence on the part of the maker, yet this constitutes no defense against a bona fide holder for value.

It is the settled law of the land that one who takes negotiable paper transferable by delivery, acquires an absolute property in it, and may recover upon it, although the paper was fraudulently put in circulation, and had been stolen, provided he takes it in good faith for a valuable consideration, even though guilty of gross negligence in doing so. The burden of proving good faith may be on the plaintiff, but this is prima facie implied by possession. This doctrine is not disputed, and is reiterated in all the texts books on bills and notes.

Where the holder of negotiable paper receives it without notice of any equities that may exist between the maker and payee, he is a holder without notice and in good faith; and the holder who is guilty of no fraud and has no actual or constructive notice, is protected. (See Parsons on Notes and Bills, Vol. 1, page 275, 276.

ADAMS, Judge, delivered the opinion of the court.

This suit originated before a justice of the peace, and was founded on the following note:

“$150.

SEDALIA, February 24, 1870.

On or before the 10th day of June, 1870, for value received, I, the subscriber, of Mt. Sterling Township, County of Pettis, State of Missouri, promise to pay S. R. Squier or order, one hundred and fifty dollars without discount or defalcation, and with interest at 10 per cent. from date, at Sedalia, Mo., P. O.”

DAVID EWART.

A judgment was rendered against the defendant by the justice, from which he appealed to the Common Pleas Court.

On the trial in the Common Pleas, evidence was given conducing to show that the defendant's signature to the note was obtained by Squier, the payee, in the following manner. He went to defendant's house late in the evening and proposed to sell his son a patent pump; he had been there before for that purpose and the defendant had advised his son not to purchase. Squier brought a model of the pump with him and proposed to appoint the defendant's son agent for the sale of the pumps, and the son agreed to take the agency. The defendant agreed to vouch for his son, and a contract of agency was produced by Squier, by which Squier made the son agent, and the son with the defendant signed the agency contract to account for the proceeds of sales, etc. This was after dark and a lamp was lighted. Squier then produced a printed order with necessary blanks for the defendant to sign and keep as the form of an order for pumps to be sent to the agent. The defendant read over this form and signed and retained it. Squier then rose to his feet and seemed in a great hurry to start, and drew out what he said was a copy of the order and that the defendant must sign it to send off at once to New York for the pump--that he would take it right into town with him and mail it that night. He said the papers were just the same. They looked just alike. He hurried up defendant, had his own pen and ink with him, and defendant signed the paper as and for an order for a pump. Defendant in his evidence stated he never signed the paper as a note but as an order. That he never delivered any paper to Squier as a note, and the only papers he intended to make were the agency contract and the order for a pump. That Squier took his paper off with him as an order for a pump.

On the part of the plaintiff it was in evidence that he purchased the note from Squier for $125, without any knowledge or notice of the alleged fraud in obtaining the signature of the defendant. That Squier sold it to him a short time after its date and before maturity.

This suit was brought by plaintiff as assignee of the note.

The defendant asked the court to declare the law to be, that “although the court should find from the evidence that the defendant did write his name on or to the paper herein sued upon, yet if the court further finds from the evidence that the signature of defendant was obtained thereto without the fault or negligence of defendant, on the fraudulent representations of the payee that the paper to which it was put was a mere duplicate of the order...