Chariton Plow Co. v. Davidson

• Decision Date: 01 July 1884
• Citation: 20 N.W. 256,16 Neb. 374
• Parties: THE CHARITON PLOW COMPANY, PLAINTIFF IN ERROR, v. J. H. DAVIDSON, DEFENDANT IN ERROR
• Court: Nebraska Supreme Court

20 N.W. 256

16 Neb. 374

THE CHARITON PLOW COMPANY, PLAINTIFF IN ERROR, v. J. H. DAVIDSON, DEFENDANT IN ERROR

Supreme Court of Nebraska

July 1, 1884

ERROR to the district court for Otoe county. Tried below before POUND, J.

AFFIRMED.

C. W Seymour, for plaintiff in error.

Watson & Wodehouse, for defendant in error.

OPINION

COBB CH. J.

The main question involved in this case arises upon the refusal of the trial court to instruct the jury as prayed by the plaintiff, as follows:

"6. The jury are further instructed that when a person sets up fraud to defeat a recovery on a note, and supports such defense by his own testimony alone, and the other party to the transaction by his testimony denies the statements of the defendant in respect to such fraud, and both parties are equally credible, have equal opportunities for knowing, and testify with equal fairness, candor, and truthfulness, and neither is corroborated by other evidence or by other facts or circumstances shown on the trial, then the defense of fraud is not proven.

"7. The court instructs the jury that if they believe from the evidence that the defendant signed his name to the note introduced in evidence, then the note will entitle the plaintiff to recover, unless the defendant has established, by a preponderance of evidence, that the signature to the note was obtained by fraud, and that the plaintiff had notice of the same.

"8. The court instructs the jury that if the note sued on in this case was transferred to the plaintiff in this case, before maturity, for value and without notice of any fraud in relation thereto, the plaintiff will be protected against any defense by the defendant.

"9. The court instructs the jury as a matter of law that the consideration of a negotiable note cannot be impeached in the hands of an innocent purchaser for value who has received it in good faith before it came due without any notice of such defense.

"10. The jury are instructed that when a person executes a note he must be diligent, and use all reasonable means to prevent a fraud being practiced on him, and if he does not do so he will be liable to an innocent purchaser of the note before maturity.

"11. If the jury believe from the evidence that the defendant signed the note in question in this case, knowing that it was a note, and they also believe from the evidence that the note was made to the plaintiff for a valuable consideration before the maturity of the note in the regular course of business, and the plaintiff at the time of the transfer had no notice that the note was not properly put in circulation, then the plaintiff will have the right to recover even though the jury may further believe that the note was obtained from the maker by fraud, or otherwise wrongfully put in circulation.

"12. That although the jury may believe from the evidence that the note in question was obtained by fraud, still, if the jury believe from the evidence that the plaintiff took the same in the regular course of business in good faith, for a valuable consideration, and before maturity, and without any knowledge of the manner in which it was obtained, then the plaintiff is entitled to recover on the same.

"13. If the jury believe from the evidence that the defendant signed the note sued on, and that the Chariton Plow Company bought the note before due, in good faith, and without any notice of any defense existing to said note, for a valuable consideration, in the usual course of business, then you will find for the plaintiff for the amount now due on said note according to its terms."

The note sued on was copied in the petition as follows:

"No. 173. HENDRICKS TP., April 8, 1880.

"On or before the first day of Oct., 1880, I promise to pay to the Chariton Plow Company, or bearer, one hundred and fifty dollars at Otoe Co. Bank of Neb. City, with ten per cent interest from date; interest if not paid to draw 10 per cent. We agree to pay all costs of collection, attorney's fee, etc. If collected by a suit a justice of the peace may have jurisdiction of this note.

(Signed), "J. H. DAVIDSON."

Upon an examination of said copy in connection with the above prayers of the plaintiff it will be readily seen that no question of endorsement before maturity, or for value, or the receipt of such note by the plaintiff in the ordinary course of business and without notice of defenses, can possibly arise in the case. The plaintiff is a party to the note, the payee, and as such is charged with a knowledge of the facts of its execution and delivery, including the consideration, or at least with such notice of them as would put a man of ordinary prudence upon such inquiry as would have led to such knowledge. According to the defendant's theory of the case, the parties actually taking the said note were the agents of the plaintiff, and whether they were really so at the time of the transaction or not, I think that its claiming property in and suing on the note estops it to deny such agency. See Vorce v. Rosenbery, 12 Neb. 448, 11 N.W. 879. So that there was no error on the part of the court in refusing to give any of the above instructions, all of them being drawn upon the theory of the plaintiff's holding the note as an endorsee before maturity, except the 6th, which was rightly refused, because to have given it would have been to unwarrantably interfere with the right of the jury to judge of the weight of evidence.

The defendant was sworn and examined as a witness in his own behalf, and testified as follows:

1. Mr. Davidson, are you the defendant in this case?

A. Yes.

2. State if you remember when you first met Ferrin and Williams, and where?

A. They came to my house on the morning of the 8th of April, 1880.

3. Where is your house?

A. In Hendricks precinct, this county.

4. State what was said there by them, or what was done in reference to this matter in this suit? * * * State what occurred there and what was done by Ferrin and Williams at the time you mentioned.

A. They came there on the morning of the 8th of April, as I have stated, with a spring wagon with one of these attachments loaded on the wagon. They said that they had received a recommendation from my neighbor, Wm. Perrill, that I was a man who would make a good agent, and requested me to become local agent for this attachment. I was just taking my team out of the stable to go into the field to plow. They appeared to be in a hurry; did not want to consume much time; told me how they wished to sell them, and drew up a contract for me to fill out. They filled out two contracts and I signed them.

Q. Who did they say they were acting as agents for? State that conversation.

A. They were general agents for the state of Nebraska. * * *

5. State who they said they were acting for?

A. They were general agents in the state of Nebraska for the Chariton Plow Company.

6. Of what place?

A. Chariton Plow Company, Iowa.

7. What town?

A. Chariton.

8. Now is that the contract?

A. That is the identical contract.

[Copy of Contract.]

"Ferrin & Williams, state agents for the light draft sulky and attachments, hereby agree to pay in cash for each approved order furnished them by J. H. Davidson the commission set opposite the retail price below:

"Retail

price

of sulky five

$ 36 00,

commission

$ 6 00

"

"

corn plow attachment

14 00,

"

2 00

"

"

field cultivator attachment.

9 00,

"

1 00

"

"

stalk cutter attachment

20 00,

"

3 00

"

"

rolling coulter

5 00,

"

50

"

"

3 horse evener

4 00,

"

50

"

"

complete machines

88 00,

"

15 00

"And I, J. H. Davidson, hereby agree to use my influence and best efforts to introduce and sell said machines, and to make full and prompt payment of all moneys and notes received by me for all machines sold.

"FERRIN & WILLIAMS.

"Address all correspondence to

Ferrin & Williams, General

Agents, Omaha, Nebraska.

"Ferrin & Williams, Agents.

"J. H. Davidson, Local Agent.

"Hendricks Post Office.

"Dated April 8, 1880."

9. Who executed it?

A. One of these men.

10. Could not say which one?

A. No.

11. Both there at the time?

A. Yes, sir, one of them got out of the buggy and filled this out just by the manure pile.

12. At your stable?

A. Yes.

13. What else did they deliver you there? What others papers?

A. No papers.

14. Did they give any of these? (Referring to number of blank notes with the name of plaintiff printed in as payee.)

A. They gave me those papers.

15. All of these of the same kind as that?

A. Same kind exactly. I have some more at home.

16. What were you to do with those papers?

A. When I sold the plows, I was to take these and a written note as parties bought them.

By the court. Did you sign this contract?

A. Yes, sir.

17. Did they have ink with them?

A. Yes, sir, we had ink and pen.

18. What else was signed there? Do you remember anything else?

A. Nothing I remember of.

By the court. Did you see them sign it?

A. Yes, sir, one of them signed it for both.

19. You were to act as their agent as representing them?

A. Yes, sir.

20. At that time did you make or execute any promissory note of any kind?

A. No, they did not ask me for anything of the kind.

21. State whether or not you authorized any one to write a note for you?

A. No.

22. I will now hand you the note (Ex. B), and ask you what you know about that note, and when you first saw that note before?

A. The first I saw of it it was forwarded to the First National Bank here in the city for collection. I don't know the exact date, at the time Mr. Woolsey was in the bank.

23. Did you authorize them to fill up any blank or note for you?

A. No.

24. Was there any note spoken of?

A. No.

25. Anything of the kind said?

A. No....