Carey v. Zabel

• Citation: 198 N.W. 169,112 Neb. 16
• Decision Date: 10 April 1924
• Docket Number: 23661
• Parties: JOHN CAREY ET AL., APPELLANTS, v. HERMAN ZABEL ET AL., APPELLEES
• Court: Supreme Court of Nebraska

198 N.W. 169

112 Neb. 16

JOHN CAREY ET AL., APPELLANTS, v. HERMAN ZABEL ET AL., APPELLEES

No. 23661

Supreme Court of Nebraska

April 10, 1924

APPEAL from the district court for Lancaster county: JEFFERSON H BROADY, JUDGE. Reversed.

REVERSED.

Burr Brown & Dibble and Stewart, Perry & Stewart, for appellants.

Holmes Chambers & Mann, Hartigan & Fouts, T. S. Allen and H. J. Requartte, contra.

Heard before MORRISSEY, C. J., LETTON, ROSE, DAY and GOOD, JJ., and ELDRED, District Judge.

OPINION

ROSE, J.

This is an action on a promissory note for $ 8,000, dated August 28, 1920, due March 1, 1921. Herman Zabel was maker and the States Realty Investment Company payee. Plaintiffs are John Carey and Herbert G. Dyar, who pleaded in their petition that they were purchasers of the note in good faith in the regular course of business for a valuable consideration before maturity, that the payee indorsed the note and delivered it to them, that they are the owners and holders of it, and that it is unpaid. Plaintiffs alleged further that they presented the note to the indorser and demanded payment at maturity, which was refused. The maker of the note, the indorser thereof, and Edward G. Maggi, receiver of the indorser, are defendants.

Defendant Zabel filed an answer in which he admitted the execution and delivery of the note, alleged there was no consideration for it, and charged plaintiffs with knowledge of this and other defenses at the time of the indorsement pleaded by them in their petition. By general denial of facts not admitted, he put in issue the indorsement of the note to plaintiffs and their ownership of it. The reply amounted to a general denial. After evidence had been adduced by both sides, the trial court directed a verdict in favor of defendants and dismissed the action. Plaintiffs have appealed.

Did the trial court err in directing a verdict in favor of defendants? There is evidence tending to prove that payee indorsed the note to plaintiffs, delivered it to them, and that they are the owners of it. It follows that the peremptory instruction cannot be justified on the ground that the note was not transferred to plaintiffs or that they do not own it--issues raised by the general denial in the answer of Zabel.

Does the answer state facts constituting a defense to the note itself? This is the principal question presented by plaintiffs. It is alleged in substance by Zabel that the note was given pursuant to a written contract in which the States Realty Investment Company, payee, agreed to sell Zabel a tract of land which it did not own, but which belonged to plaintiffs; that in the sale of the land payee was the agent of plaintiffs; that Zabel was entitled to a deed upon execution and delivery of the note, but did not receive it that he never received any consideration for the note, and that plaintiffs hold it...