Doughty v. Funk

• Decision Date: 13 July 1909
• Citation: 103 P. 634,24 Okla. 312,1909 OK 161
• Parties: DOUGHTY v. FUNK.
• Court: Oklahoma Supreme Court

103 P. 634

24 Okla. 312, 1909 OK 161

DOUGHTY v. FUNK.

Supreme Court of Oklahoma

July 13, 1909

Syllabus by the Court.

In an action on a promissory note by one as receiver of the indorse thereof, where nothing appears by way of indorsement or otherwise to indicate the ownership of plaintiff therein, or that said note had passed under his receivership, but there is an allegation in the petition that "he is the owner and holder of said promissory note as receiver," held, that such allegation may be put in issue by an answer not verified by affidavit.

In an action on a promissory note by one as receiver of the indorsee thereof, advantage cannot be taken of a failure to verify an answer putting in issue the ownership of plaintiff to the note sued on by objecting to the introduction of any evidence under it. An objection to said answer for that reason should be taken by motion to strike, or the same will be considered waived.

An action on a promissory note by one as receiver of the indorsee thereof cannot be maintained unless the original be introduced in evidence, where the same is in the custody or control of plaintiff. This rule of evidence is not dispensed with by Wilson's Rev. & Ann. St. 1903, § 4312, which provides that: "In all actions, allegations of the execution of written instruments and indorsements thereon *** shall be taken as true unless the denial of the same by verified by the affidavit of the party. ***" Said statute does not dispense with proof of the existence of the instrument or the right of the party to hold it by assignment.

Error from District Court, Kingfisher County; A. H. Huston, Judge.

Action by James Doughty against Jacob P. Funk. Judgment for defendant, and plaintiff brings error. Affirmed.

F. L Boynton and West, Scott & Otjen, for plaintiff in error.

W. M Hinch, for defendant in error.

TURNER J.

On April 16, 1903, James Doughty, as receiver of the Union Trust Company of Sioux City, Iowa, plaintiff in error, plaintiff below, sued Jacob P. Funk, defendant in error, defendant below, in the District Court of Kingfisher county on the following promissory note: "Peabody, Kansas, June 1 1886. Know all men by these presents: That five years after the date hereof, for value received, I promise to pay to the order of Shupe, Tressler & Lark, the principal sum of fourteen hundred dollars, lawful money of the United States of America, with interest thereon at the rate of seven per centum until paid, semiannually, on the first days of June and December in each year according to the tenor of ten interest coupons of fifty-nine dollars, each, bearing even date herewith, hereto annexed. Both principal and interest coupons payable at the Union Trust Company, Philadelphia, Pa., and if default be made in the payment of any interest coupon or any portion thereof, then all said principal and interest coupons shall at the option of the said Shupe, Tressler & Lark as the legal holder thereof, become at once due and payable without further notice and the holder thereof may collect the principal and interest at once as stipulated on the mortgage made to secure this note. All appraisement and stay laws are hereby expressly waived. The principal and interest coupons are to draw interest at 12 per cent. per annum after default of payment of any interest coupon or after maturity. It is further agreed and declared that the notes are made and executed under, and are in all respects to be governed and construed by the laws of the state of Kansas, and is given for an actual loan of fourteen hundred dollars, said loan being secured by mortgage of even date herewith on real estate, duly recorded. Jacob P. Funk. Donaldson, Hosmer & Co. Witnesses: M. C. Donaldson. E. M. Donaldson."

The petition, in substance, states: That said Union Trust Company is a foreign corporation under the laws of Iowa. That theretofore in the district court in the county of Woodbury in said state said Doughty was appointed receiver of said company. That he is now duly qualified and acting as such and is authorized and empowered to collect debts due and owing to said company and sue and be sued and to transact any and all business necessary to close up the business affairs of said company. That on the date thereof defendant made, executed, and delivered to the payees therein said note, who made thereon (without date) the following assignment: "For value received, we hereby assign and transfer the within note and coupons together with all interest in and right under the real estate first mortgage securing the same without recourse to the Union Trust Company of Sioux City. [Signed] Shupe, Tressler & Lark." That plaintiff "is the owner and holder of said promissory note as receiver aforesaid. That no part of said principal or interest has been paid as above set out," and there is now due on said note $1,671 and interest, and prayed judgment. For amended answer defendant, among other things, pleaded a general denial, and specifically denied, "that James Doughty, receiver of the Union Trust Company of Sioux City, Iowa, is now the owner and holder of the note sued on herein." After reply there was trial to a jury, which resulted in a judgment for defendant, and plaintiff brings the case here for review.

To maintain the issues on his part, plaintiff, evidently for the purpose of avoiding the bar of the statute of limitations, also pleaded by defendant, introduced in evidence the authentication of Dassler's Gen. St. Kan. 1901, p. i, and article 2, c. 119, p. 1623, authorizing references to sections in printed statutes; also, article 3, c. 80, § 21, p. 932, and the case of Mary E. Lane, Adm'x, v. First National Bank, 6 Kan. 49, construing said statute, and rested his case. Thereupon defendant, assuming the burden of proof that plaintiff, as receiver, was not the owner of said note, and that one Baxter was the real party in interest, proved by him, in substance: That prior to this suit he was a collector and received the note in question from plaintiff's attorney for collection; that on April 11, 1903, he wrote a letter at Marion, Kan., to defendant, threatening suit on said note, which said letter was introduced in evidence; that he thought it was in the summer of that year when he bought the note from plaintiff through his attorney and took a written assignment thereof from plaintiff which was not dated, and which was within a year "perhaps" thereafter returned to plaintiff, who inserted, "Dated at Sioux City, Iowa, August 13, 1903"; that he did not have the note and could not produce it for the reason that he "presumed" it was at Marion, Kan.; that he did not know whether he first owned said note before or after this suit was brought, but, being repeatedly pressed by counsel, finally stated: "To my best recollection I did not. I don't know anything about that only as a recollection." The attorney for plaintiff testified that he had no communication with plaintiff about this suit, but that he received all instruction with reference thereto from Baxter, and that after this suit was brought he received said assignment of the note in question from Baxter and is still in possession of the same.

This was substantially all the evidence in the case, and upon it, as the jury found, in substance, that plaintiff was not the owner of the note at the time this suit was brought, but that Baxter was the real party in interest, and, as there is evidence reasonably tending to support the finding, we do not feel disposed to interfere with it, unless, as is contended by plaintiff, all such evidence which was objected to on that ground by defendant at the time was improperly admitted for the reason that the same constituted no defense. In support of this objection, it is urged that, as the answer put in issue plaintiff's ownership of the note, it should have been verified, and, as it was not verified, said ownership could not be questioned. We do not think that the answer was required by the statute to be verified to raise the issue relied on. The statute (Wilson's Rev. & Ann. St. 1903, § 4312) reads: "In all actions, allegations of the execution of written instruments and indorsements thereon, of the existence of a corporation or partnership, or of any appointment or authority, or the correctness of any account duly verified by the affidavit of the party, his agent or attorney, shall be taken as true unless the denial of the same be verified by the affidavit of the party, his agent or attorney." The copy of the note, filed as an exhibit to the petition, shows that it was specially indorsed by the payee to the Union Trust Company. Suit thereon is brought by plaintiff as receiver of that company. Nothing appears by way of indorsement or otherwise to indicate the ownership of plaintiff therein, or that the same passed under his receivership. He alleges that "he is the owner and holder of said promissory note as receiver." This is denied in the answer. In an action on an instrument thus specially indorsed, brought by one other than the indorsee, who alleges that he is the owner thereof, an answer, which alleges that plaintiff is not the owner, puts in issue his title, and that too without being verified as required by said section.

Washington v. Hobart, 17 Kan. 275, was a suit on four promissory notes all executed by the defendants Washington and Simpson Two of the notes were made payable to the order of A. L. Austin, and the other two to the order of John Getty. Plaintiff, Hobart, claimed to be the owner and holder of all four notes. He did not claim in his petition that the same were ever indorsed to him, or to any one else, or were ever transferred to him or any one else by indorsement, and the copies attached as exhibits to the petition did not purport to have...