Edelen v. First Nat. Bank

• Decision Date: 17 November 1921
• Docket Number: 9.
• Citation: Edelen v. First Nat. Bank, 139 Md. 422, 115 A. 602 (Md. 1921)
• Parties: EDELEN v. FIRST NAT. BANK OF HAGERSTOWN.
• Court: Maryland Court of Appeals

115 A. 602

139 Md. 422

EDELEN v. FIRST NAT. BANK OF HAGERSTOWN.

No. 9.

Court of Appeals of Maryland

November 17, 1921

Appeal from Circuit Court, Montgomery County; Edward C. Peter and Glenn H. Worthington, Judges.

Action by the First National Bank of Hagerstown against Edward G Edelen. Judgment for plaintiff, and defendant appeals. Affirmed.

Robert B. Peter, of Rockville, and L. Allison Wilmer, of Leonardtown (Mitchell & Digges, of La Plata, on the brief), for appellant.

Thomas L. Dawson, of Rockville, and Harvey R. Spessard, of Hagerstown (Henry F. Wingert, of Hagerstown, Ferdinand C Cooksey, of La Plata, and Dawson & Dawson, of Rockville, on the brief), for appellee.

URNER J.

The decision just rendered in the case of Edelen v. First National Bank of Hagerstown, 115 A. 599, disposes of some of the questions raised on this appeal. The opinion in that case refers to the promissory note here sued on, and states the circumstances of its origin and of its acquisition by the bank. It is one of the notes for which those involved in the other case were designed to be substituted. The retention and disposition of all of the notes by the person to whom they were originally delivered is a part of the fraud in their inception which the former opinion describes. A separate suit has been brought on the note now before us because it is signed by only one of the two persons who made and indorsed the notes on which the other action was instituted. The same question as to the legal sufficiency of the evidence to show that the bank was not a holder in due course was raised in both cases, and there is no material difference in the testimony presented by the two records on that subject. The instruction which we approved in the case first decided was likewise granted in this instance, and we concur in that ruling for the reasons stated in the prior opinion.

This record also contains three exceptions to rulings on the admissibility of evidence which present questions identical with some of those decided on the other appeal and which therefore, need not be discussed.

An exception was taken to the refusal of the court to permit the president of the plaintiff bank to be asked, on cross-examination, What is the purpose of making a note payable to "myself"? the note in suit being in that form. The expression of an opinion by the witness upon that question would have been wholly immaterial. The negotiability of a note so drawn is recognized by the Negotiable Instruments Act (Code art. 13, § 83), and the adoption of that form of note by the defendant, as the maker and indorser, did not tend to suggest any fraud in its origin.

The most important exception in the record sought unsuccessfully to deprive the plaintiff of the position of a holder in due course on the theory that the note was not negotiable, and hence was subject to the original equities, because it contained the following provision:

"Claim to exemption waived, and it is hereby further agreed that at any time judgment confessed shall be entered in a proper court against the maker or makers, and indorser or indorsers thereof, if any, for such sum as may be due thereon, and costs, and ten per cent. additional to said sum as a fee" to designated attorneys for obtaining the judgment.

The Negotiable Instruments Act provides that-

"The negotiable character of an instrument otherwise negotiable is not affected by a provision which *** authorizes a confession of judgment if the instrument be not paid at maturity." Code art. 13, § 24.

It is contended that the clause we have quoted from the note authorizes a judgment to be confessed on it before maturity and that its negotiability is thereby destroyed. If the provision was simply that the judgment might be obtained "at...