Dean v. Vice

• Decision Date: 11 October 1919
• Citation: 234 Mass. 13
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court
• Parties: FRANKLIN W. DEAN v. LOUIS VICE & another.

234 Mass. 13

FRANKLIN W. DEAN v. LOUIS VICE & another.

Supreme Judicial Court of Massachusetts, Franklin.

October 11, 1919

September 16, 1919.

Present: RUGG, C.

J., BRALEY, DE COURCY, CROSBY, & CARROLL, JJ.

Bills and Notes Validity, Indorsee's rights, Assignment. Partnership. Evidence, Competency. Pleading, Civil, Answer. Assignment.

One, who receives a negotiable promissory note by assignment from a person to whom it had been indorsed and delivered by the payee for a valuable consideration before maturity and without any notice of fraud practised by the payee upon the maker, can recover upon the note in an action against the maker although, as between the maker and the payee, the note was voidable by the maker by reason of fraud and it was overdue when the assignment was made.

In an action by the assignee of an indorsee of a negotiable promissory note against a partnership as the makers of the note, where it appears that the note was signed in the partnership name by one of the partners and it did not appear that the indorsee who received the note before maturity in good faith for valuable consideration, had knowledge of any restriction upon the right of the partner who signed the note to bind the partnership by his signature, evidence, tending to show that the partners by agreement between themselves had agreed that the signatures of both partners should be necessary to bind the partnership upon a contract in writing, is inadmissible.

A partnership has inherent power to issue in payment of its obligations negotiable promissory notes signed in the partnership name by a single member of the firm, and private restrictions as to the effect of such a signature cannot affect those who without knowledge of them, received such notes in payment of partnership obligations.

In an action upon a promissory note against a partnership as the maker, brought by one to whom an indorsee who was a holder in due course had assigned the note, an exception by the defendants to the admission of the note in evidence at the trial on the ground that the signatures of the makers and of the payee were not proved, must be overruled where one of the partners testified that he signed the firm name to the note, and where the only allegation as to signatures in the defendants' answer was, "And the defendants further answering specially denies that he made any note and specially denies the signature on said note."

At the trial of an action by the assignee of an indorsee against the maker of a promissory note in which the defendant had not specifically denied the signature upon the assignment, the defendant objected and excepted to the admission of the assignment in evidence, and, when asked by the judge to state what his objection was, said "That there is nothing to prove the signature of the . . . [payee] . . . or no proof that there is any such concern as the firm named to which this purports to be conveyed." There later were introduced in evidence depositions which showed that the indorsee was a corporation engaged in the jewelry business. Held, that the defendant could not be heard to contend in support of his exception that the signature of the indorsee to the assignment was not proved, as that was not the ground upon which the admission of the assignment in evidence was objected to.

CONTRACT upon three negotiable promissory notes, each for $225, alleged to have been made by the defendants, payable to the Parton Manufacturing Company, indorsed by the payee to a corporation named Despres, Bridges and Noel, and by the indorsee assigned to its credit man, the plaintiff. Writ dated December 13 1917.

The defendants' answer, besides a general denial, specifically denied that the plaintiff was a holder for value, and contained the two following allegations:

"And the defendants further answering specially denies that he made any note and specially denies the signature on said note."

"And the defendants further answering say that any agreement that he signed, that it was signed with a distinct understanding that unless his brother who was a member of the firm consented to it that the order was not to be sent and that all papers were to be returned to the defendants. And the defendants say that the plaintiff was notified at once that his brother did not consent and that they did not care to enter into the agreement and requested the return of the papers."

In the Superior Court the action was heard by Aiken, C. J., without a jury. Material evidence and facts found by the Chief Justice and exceptions saved by the defendants to the admission and exclusion of evidence are described in the opinion. At the close of the evidence the defendants asked for the following rulings:

"1. That upon all the evidence, the plaintiff is not entitled to a finding.

"2. That upon all the evidence, there was no delivery of the note or notes to the plaintiff's agents or servants.

"3. That a passing of the notes to a third party was a fraud upon the defendant, and the plaintiff is not entitled to recover."

The requests were refused. The Chief Justice...