Campbell v. Hoff

• Decision Date: 18 June 1895
• Citation: 31 S.W. 603,129 Mo. 317
• Parties: CAMPBELL v. HOFF.
• Court: Missouri Supreme Court

31 S.W. 603

129 Mo. 317

CAMPBELL v. HOFF.

Supreme Court of Missouri, Division No. 2.

June 18, 1895.

ACTION ON NOTE — BURDEN OF PROOF — SALE — ESTOPPEL TO ASSERT.

1. When it is shown that a note was originally obtained by fraud, the burden is on the holder to show that he got it for value, in good faith.

2. Where defendant, on purchasing certain

property with plaintiff, is deceived by him as to the price, and pays part cash, and gives a note for the balance, in excess of the real price paid, he is not estopped, in an action on the note, to ask the cancellation of the same, and recovery of the excess, though he paid interest on the note after knowing the fraud.

Appeal from circuit court, Jasper county; W. M. Robinson, Judge.

Action by William A. Campbell against J. R. Hoff on a note. From a judgment for defendant, plaintiff appeals. Affirmed.

Cunningham & Dolan, for appellant. Henry Kortjohn and J. W. McAntire, for respondent.

BURGESS, J.

Action on a negotiable promissory note for $8,000, dated St. Louis, Mo., December 29, 1890, executed by the defendant to William H. Cooper and Theodore D. Wannfried payable one year after its date, with 6 per cent. interest, and indorsed and delivered by the payees to the plaintiff, as collateral, for Wannfried. The petition is in the usual form. The answer denies all allegations in the petition. It then avers that there was no consideration for said note, and that the same was obtained from him by means of fraud and misrepresentations by plaintiff and one Wannfried, one of the payees. For further answer to plaintiff's petition, and by way of counterclaim against the plaintiff, it is averred: That in the month of December, 1890, a certain partnership, known as the Buckeye Mining Company, composed of J. C. Steele, Fred L. Rosemond, Charles M. Campbell, and the plaintiff, were the owners of a mining lease on certain real estate in Jasper county, Mo. That at said time defendant and said Wannfried sustained intimate social and business relations, and that at said time said Wannfried was the adviser of defendant as to investments in mining property in said county, which plaintiff well knew. That on the 9th of December, 1890, Wannfried proposed to defendant that he (Wannfried), the plaintiff, said Cooper, and defendant should associate themselves together for the purpose of purchasing said lease. That thereafter Wannfried brought the persons named, including himself, together, and it was then decided that the plaintiff, said Cooper, Wannfried, and defendant should together purchase said lease from said mining company, with a view to forming a copartnership, with the view of holding said lease, and operating the same; that, of the purchase price of said lease, the defendant should contribute sufficient to pay two-fifths thereof, the plaintiff, Wannfried, and Cooper, each one-fifth; and that their interests should be in proportion to the amount paid by them, respectively, towards the purchase price. That plaintiff and Wannfried then and there represented to defendant that the purchase price of said lease, together with the machinery pertaining thereto, was $25,000, and that it could not be bought for any less. That, relying on the statement of plaintiff and said Wannfried that it would take $25,000 to purchase the lease and machinery, he agreed to contribute towards the purchase price, for his two-fifths interest in the same, the sum of $10,000: and that it was then and there agreed that plaintiff, Wannfried, and Cooper should each contribute $5,000 towards the purchase price. That believing said statements of plaintiff and Wannfried to be true, and relying upon them, as aforesaid, defendant paid to plaintiff, as the agent of said Buckeye Mining Company, $2,000 towards the purchase price of said property; and at that time, in the presence of defendant, for the purpose of deceiving him, Wannfried and Cooper went through the form of each giving his check for $1,000 to plaintiff, in part payment of the interest pretended to be purchased by him, but said checks were not paid, nor were they intended to be paid, but were returned by plaintiff to Wannfried and Cooper. That, believing the said representations of plaintiff and Wannfried to be true, defendant executed the note sued on, for the purpose of securing what he then believed to be the remainder of his proportionate share of the purchase price of said leasehold and machinery. That the note was made payable to the order of Wannfried and Cooper, upon the faith of their representations, and also of plaintiff, that each of them...