Donnelly v. Garvan

• Decision Date: 09 July 1930
• Citation: 111 Conn. 626,151 A. 168
• Court: Connecticut Supreme Court
• Parties: DONNELLY v. GARVAN.

151 A. 168

111 Conn. 626

DONNELLY v. GARVAN.

Supreme Court of Errors of Connecticut.

July 9, 1930

Appeal from Superior Court Hartford County; Edward M. Yeomans Judge.

Action by Elizabeth Donnelly against Agnes M. Garvan, executrix, the personal representative of a deceased accommodation indorser of a promissory note, tried to the court. Judgment for plaintiff, from which defendant appeals.

Error judgment reversed, and case remanded, with directions.

Clayton L. Klein, of Waterbury, for appellant.

Nathan R. Bronson, of Waterbury, for appellee.

Argued before WHEELER, C.J., and MALTBIE, HAINES, HINMAN, and BANKS, JJ.

HAINES, J.

The complaint alleged, and the answer admitted, that the note upon which this action is based was for $5,000, signed by the Bradley Fire Proofing Company, Incorporated, dated November 30, 1926, and payable sixty days after date with 6 per cent. interest. The note was payable to Rosella Fitzpatrick, and when delivered to her bore the indorsement of Thomas F. Garvan. Rosella Fitzpatrick indorsed the note and delivered it to the plaintiff, Elizabeth Donnelly. Thomas F. Garvan died December 5, 1926, and the defendant qualified as executrix of his will and estate December 16, 1926. The note has never been paid. It was further alleged that the plaintiff, at the time the suit was brought, was the holder of the note, which was admitted by the answer. It was further alleged that the note was duly presented at maturity but was not paid, that the plaintiff still owned the note, and that she duly presented the note to the executrix; as to these allegations, the defendant pleaded no knowledge. The further allegation that notice of nonpayment was duly given to Thomas F. Garvan was denied. The trial court found for the plaintiff upon all these issues and gave judgment for $5,736.66.

The appellant seeks to strike out six of the nineteen paragraphs of the finding and substitute four others, as well as to add twenty-four paragraphs from the draft finding, and the refusal of the trial court to do so is assigned as error. The evidence certified is somewhat meager, but we must assume it is all the evidence given relevant to these claims. Practice Book 1922, p. 96, § 5830; Costantino v. Lodjiodice, 93 Conn. 203, 105 A. 465: Rowell v. Ross, 89 Conn. 201, 208, 93 A. 236. A careful study of all these claims and of the evidence justifies the granting of some of the requests in whole or in part, and without detailed discussion, we add the following facts to the finding:

" 2e. The exact date when the note was delivered to the plaintiff by Rosella Fitzpatrick was not established, but it was a few days before its maturity." " 2f. The morning after she received it, the plaintiff wrote her name on the back of the note and sent it to her bank for collection. The date upon which she sent it was not established." " 2g. The plaintiff could not tell whether she knew of the death of Garvan at that time, nor could she tell whether she received notice of protest." " 2h. Rosella Fitzpatrick had been advised to put the note in the hands of some one she could trust, and she therefore delivered it to her friend the plaintiff, at the home of the latter in New York City, and asked her as a favor, to put it through the plaintiff's bank for collection, which was done." Paragraph 5 of the finding is stricken out, and the following substituted: " The notice of nonpayment was sent to ‘ Thomas F. Garvan’ who at that time had been dead several weeks." Paragraph 6 of the finding is stricken out and the following substituted: " To the time this action was brought the ownership of the note had not changed since its maturity." Paragraph 13 of the finding states, in part, that the plaintiff did not know of the death of Garvan at the time the note matured. This must be stricken out as found without evidence. On the contrary, the plaintiff herself stated that she did not remember whether she knew of Garvan's death, and admits she might have been told of it by Rosella Fitzpatrick at the time the note was handed to her. The remainder of paragraph 13 should stand.

Involved in the numerous reasons of appeal are two questions of major importance: (a) Whether the plaintiff was a holder in due course, and (b) whether the issues framed by the pleadings, if sustained by evidence, are sufficient to support the judgment.

In the law merchant, and in our Negotiable Instruments Act, the terms " holder" and " holder in due course" are not necessarily synonymous. " Holder" means the payee or indorsee of a bill or note, who is in possession of it, or the bearer thereof, while a " holder in due course" is a holder who has taken the instrument under the following conditions: (1) That it is complete and regular upon its face; (2) that he became the holder of it before it was overdue, and without notice that it had been previously dishonored, if such was the fact; (3) that he took it in good faith and for value; (4) that at the time it was negotiated to him, he had no notice of any infirmity in the instrument or defect in the title of the person negotiating it. General Statutes, § § 4358, 4410. The complaint merely alleged that the plaintiff was the " holder" of the note in question, as well as the owner, the answer admitting the former and alleging no knowledge as to the latter claim.

In thus setting up that she was the " holder," the plaintiff stated all that was necessary, prima facie, to establish her right to sue and recover. General Statutes, § 4409. " The plaintiff was justified in confining his allegations to such as disclosed his right prima facie to recover the amount of the note, and in leaving to the defendants to set up in their answer *** the facts which served to limit that right." Mersick v. Alderman, 77 Conn. 634, 638, 60 A. 109, 111; 2 Ann.Cas. 254; Sacks v. Sheiman, 105 Conn. 73, 78, 134 A. 240; Kessler v. Valerio, 102 Conn. 620, 623, 129 A. 788; Curtia v. Mohr, 18 Wis. 615.

The answer, by admitting that the plaintiff was the " holder," admitted her right prima facie to sue and recover. No claim of fraud, illegality, or defect of title was set up, or proof attempted. The attempt was made to show by evidence that the plaintiff was not a holder for value, or holder in due course, and that she was not in fact the " owner" of the note. If the facts had been established, it would not have defeated or in any way limited the plaintiff's right of recovery under the issues raised by the pleadings. The evidence was properly excluded.

The next claim for consideration is that the issues as framed by the pleadings do not sustain the judgment, and in that connection we consider whether the liability of the defendant estate of Thomas F. Garvan to this plaintiff has been established. As we have seen, the pleadings disclose a suit by a holder of a note which has matured, has been presented for payment at maturity, and payment refused, and it is sought by the holder to compel the estate of the indorser to pay the note. That Thomas F. Garvan's position was that of an " indorser," with all the rights and liabilities which the Negotiable Instruments Act attaches to that position, is beyond question. Formerly, at common law, there was much conflict of opinion in different jurisdictions as to the exact status of one who merely signed a note in blank on its back, before the delivery of the note to the payee, where the note was payable, as in this case, to a third person, but now by the uniform act, generally adopted, it is settled that " a...