Charles H. Fuller Company, a Corp. v. St. Louis Wholesale Drug Company, a Corp.

• Decision Date: 02 March 1926
• Parties: CHARLES H. FULLER COMPANY, a Corporation, Respondent, v. ST. LOUIS WHOLESALE DRUG COMPANY, a Corporation, Appellant.
• Court: Missouri Court of Appeals

282 S.W. 535

219 Mo.App. 519

CHARLES H. FULLER COMPANY, a Corporation, Respondent, v. ST. LOUIS WHOLESALE DRUG COMPANY, a Corporation, Appellant.

Court of Appeals of Missouri, St. Louis

March 2, 1926

Appeal from the Circuit Court of the City of St. Louis.--Hon. M Hartmann, Judge.

REVERSED AND REMANDED.

Judgment reversed and cause remanded.

S. T G. Smith and Gustave A. Stamm for appellant.

(1) (a) Declarations, whether written or oral, made by plaintiff to third parties, in his own favor, in the absence of defendant are hearsay and manifestly self-serving and are therefore inadmissible in evidence. McFarland v. Bishop, 282 Mo. 534; Dietz v. Nix, 202 Mo.App. 639; Hammond v. Beeson, 112 Mo. 190; Horner v. Franklin, 186 Mo.App. 434; Davis v. McClelland, 185 Mo.App. 130; Champion Coated Paper Co. v. Shilkee (Mo. Sup.), 237 S.W. 109, 111. (b) Objections to the admission of a deposition as incompetent and irrelevant because it was hearsay in character and wholly selfserving may be made at the trial in the same manner and with like effect as if such witness were personally present. R. S. 1919, sec. 5469. (c) Where the plaintiff's direct examination in a deposition is inadmissible because of a hearsay character and self-serving, defendant's cross-examination is not available to plaintiff independently, and defendant's cross-examination of the witness at the taking of the deposition does not waive objections to its competency at the trial. Bentley v. Bentley, 72 Nebr. 803; Bertenshaw v. Laney, 77 Kans. 497; Spear v. Richardson, 37 N.H. 23; Collison v. Smith, 20 Kans. 28; Achilles v. Achilles, 137 Ill. 589; Dietz v. Nix, 202 Mo.App. 639; Mt. Vernon Car Mfg. Co. v. Hirsch Rolling Mill Co., 285 Mo. 669. (2) (a) Trade acceptances are negotiable instruments and plaintiff, as holder and indorsee thereof, is prima facie presumed to be a holder in due course; however, after the defendant has proven fraud in the procurement thereof, this primafacie presumption is rebutted and the "burden of evidence" is then on plaintiff in order to recover to disclose the facts and circumstances peculiarly within its knowledge attending its purchase of the trade acceptances to show it was a holder in due course, and to show that at the time plaintiff acquired them it had no notice or knowledge of the fraud impeaching their validity and that it was free from bad faith in taking the same. American Trust Co. v. McDermott, 256 S.W. 105; Kincaid v. Estes, 262 S.W. 399; Downs v. Harton, 207 Mo. 414, 230 S.W. 103, 106; Ensign v. Crandall, 207 Mo.App. 211, 231 S.W. 675; R. S. 1919, sec. 845; Ferry v. Woody, 210 Mo.App. 98, 241 S.W. 78; Union Station Bank v. Wangler, 254 S.W. 739; Bank of Hale v. Linneman, 235 S.W. 178; Taylor v. Atlas Security Co., 249 S.W. 746; Leavitt v. Taylor, 163 Mo. 158; Thomas v. Goodrum, 231 S.W. 571. (3) The trial court erred in refusing to give and read to the jury defendant's demurrer to the evidence at the close of plaintiff's case because: (a) The vice-president or general manager of a mercantile company has no implied power, by virtue of his office, to negotiate negotiable instruments held by the corporation among its assets. Hurlbut v. Gainar, 103 S.W. 409; Smith v. Lawson, 18 West Va. 212; Hodge's Exr. v. First National Bank, 22 Gratt. 51; Dreeben v. First National Bank, 99 S.W. 850; Railway Equipment Co. v. Bank, 89 N.Y.S. (82 Hun.) 8; Blake v. Domestic Mnfg. Co., 38 A. 241; 3 Fletcher Cyclopedia Corporations, sec. 2066; Danglade, etc., Mining Co. v. Mexico, etc., Land Co., 190 S.W. 35; Leigh v. American Brake Beam Co., 205 Ill. 147; Ferguson v. Venice Transp. Co., 79 Mo.App. 352; Emmett v. Bank, 173 A.D. 840, 160 N.Y.S. 183; Friedman v. Lesher, 198 Ill. 21; Mechem Agency (2 Ed.), par. 998; Jackson Paper Mfg. Co. v. Comm'l Nat. Bank, 199 Ill. 151; Cann v. Rector, 111 Mo.App. 164; State ex rel. v. Perkins, 90 Mo.App. 603; Integrity M. & M. Co. v. Moore, 130 Mo.App. 627; Milling Co. v. Insurance Co., 105 Mo.App. 146. (b) Accordingly plaintiff failed to prove the endorsement to it of the instruments sued on; failing in which, it cannot recover. Slupsky v. Starr, 223 S.W. 816; R. S. 1919, secs. 838, 842, 845; Atkins v. Brown, 208 S.W. 502; Mayer v. Old, 51 Mo.App. 214; Nance v. Haywood, 183 Mo.App. 217. (4) Where the burden of proof is on defendant, it is entitled to open and close the argument to the jury; and the denial of this right constitutes reversible error where the court has abused its discretion in this regard to the injury of defendant. Lafayette Co. Bank v. Metcalf, 29 Mo.App. 384; Railroad v. Blechle, 234 Mo. 471; Ferguson v. Rittmann, 180 S.W. 1046; Robinson Lumber Co. v. Lansdell, 215 Mo.App. 357, 253 S.W. 24; Dorrell v. Sparks, 142 Mo.App. 460, 127 S.W. 103; Downs v. Horton, 287 Mo. 414, 230 S.W. 103. (5) Instructions 2 and 4 given for plaintiff constitute reversible error, because the jury was not instructed to find that plaintiff had acquired the trade acceptances for value and without knowledge of such facts that its action in taking them amounted to bad faith. R. S. 1919, secs. 838, 842; Thomas v. Goodrum, 231 S.W. 571; American Union Trust Co. v. Neverbreak Range Co., 196 Mo.App. 206. (6) The trial court erred in excluding from the evidence the contract of agency between defendant and Reolo, Inc., offered by defendant, because this contract together with the trade acceptances sued on, and which were issued pursuant thereto, comprised one entire contemporaneous written agreement and the testimony of plaintiff's vice-president, J. Howard Start, disclosed that he was familiar with similar contracts and the general form of agency contracts before plaintiff acquired these trade acceptances. Simpson v. Van Laningham, 267 Mo. 286, 183 S.W. 324; Citizens Bank v. Kriegshauser, 211 Mo.App. 33, 244 S.W. 107. (7) Where a party desires to show that the testimony of a witness, as given by deposition, was different from his testimony at the trial, he must have the deposition identified and offer the part of it which he contends contradicts the testimony of the witness at the trial, and then the other party may read the rest of the deposition relating to the same subject-matter; and it is error for the trial court to refuse to permit this except out of the hearing of the jury. Carter v. St. Louis & S. F. Ry. Co., 249 S.W. 124; Littig v. Urbauer-Atwood Heating Co., 237 S.W. 779. (8) Where the title of the payee to negotiable paper is defective, by reason of his own fraud in its procurement, the rule that the endorsee is prima facie its owner and is presumed to have taken it in good faith for value before maturity and without notice does not apply; and the burden rests upon the payee's endorsee to prove himself a holder in due course and to show that he acquired it in good faith without notice of the infirmity in the endorsee's title; and for failure to comply with this rule, instruction No. 1, given for the plaintiff, is erroneous. Hamilton v. Marks, 63 Mo. 167; Klein v. Vette, 167 Mo. 389, 67 S.W. 223; Campbell v. Hoff, 129 Mo. 317, 31 S.W. 603; Johnson v. McMurray, 72 Mo. 278; Henry v. Sneed, 99 Mo. 407, 12 S.W. 663; Thomas v. Goodrum, 231 S.W. 571.

Foristel, Mudd, Hezel & Habenicht for respondent.

(1) The true grounds on which hearsay testimony is rejected are that the declarant or affirmant of facts covered by the testimony is not within the pains and penalties of an oath, and not subject to cross-examination. Minea v. Cooperage Co., 179 Mo.App. 705; 2 Jones on Evidence, sec. 297, p 629. (2) Neither the deposition of Florence Fiset, establishing the writing and mailing of the letter from plaintiff to Reolo, acknowledging the receipt by plaintiff of the acceptances sued on, nor the proof of the date of the letter contravened the rule against the admission of hearsay evidence. Courtney v. Blackwell, 150 Mo. 245; 2 Jones on Evidence, sec. 300, p. 646, et seq. (3) There is a substantial difference between the rulings of a court respectively in the giving and refusing of instructions. To put the trial court in error in refusing an instruction, the complaining party must show that he presented to the court, and the court refused an instruction free from objections in form and substance. Lawbough v. Mining Co., 202 S.W. 617; Thornton v. Stewart, 240 S.W. 502; Higgins v. Pulley, 240 S.W. 252; Hildman v. Am. Mfg. Co., 249 S.W. 99; Kilcoyne v. Metz, 258 S.W. 4. (4) Defendant's refused instructions J and L were objectionable in assuming as a fact that the order referred to was "false, fraudulent and fictitious," instead of requiring the jury to find the fact. Preston v. Mo. Pac. R. R. Co., 239 S.W. 1080, 292 Mo. 440; Willi v. U. R. Co., 224 S.W. 86; Endy v. Lead Co., 220 S.W. 504; Lambert v. Assurance Co., 192 S.W. 95; Ganey v. K. C., 259 Mo. 654; Hunt v. City of St. Louis, 211 S.W. 673, 278 Mo. 213. (5) The court did not err in refusing defendant's request to open and close the argument and for the reasons more fully stated in our argument of the point. McDonald v. Redemeyer, 198 S.W. 483; Smith v. Greenstone, 208 S.W. 628; Reis v. Epperston, 143 Mo.App. 90. The true rule of the law on the point is as set out in Reis v. Epperston, supra, to-wit, that the plaintiff has the right to open and close: "as long as any part of plaintiff's case is in issue. The injection into the case by the defendants of an affirmative defense does not change the rule. The rule is changed only when plaintiff's whole case is admitted and the defense, by either matter in avoidance or the like, undertakes to meet the admitted case." (6) Plaintiff, upon introducing the acceptances sued on and proving signatures of the drawer, acceptor and endorser of the acceptances, made a prima-facie case of holder in due course and was, on that, entitled to recover, unless defendan...