Fairley v. Falcon
| Decision Date | 01 July 1927 |
| Docket Number | 37817 |
| Citation | 214 N.W. 538,204 Iowa 290 |
| Parties | J. S. FAIRLEY, Appellee, v. W. C. FALCON, Appellee, et al., Appellant |
| Court | Iowa Supreme Court |
REHEARING DENIED OCTOBER 1, 1927.
Appeal from Linn District Court.--ATHERTON B. CLARK, Judge.
Action to recover on two promissory notes. The defendant-maker of the notes, W. C. Falcon, filed no answer, and the cause as to him was dismissed, upon the commencement of the trial. The defendant C. Falcon, who affixed his signature to the notes subsequent to their execution and delivery, and after due date, in answer pleaded want of consideration, and that, at the time he signed said notes, it was orally agreed between him and the plaintiff-payee that the notes were payable at defendant's death from his estate, and that, by reason of said agreement, the action as to him was prematurely commenced. Cause tried to a jury, and, on motion of the plaintiff, a verdict was directed in his favor, and judgment was entered. The defendant C. Falcon appeals.
Affirmed.
Charles J. Haas, for appellant.
Ring & Hann and Johnson, Donnelly & Lynch, for appellee.
DE GRAFF, J.
Plaintiff-payee, J. S. Fairley, seeks to recover judgment on two promissory notes. The admitted natures of the defendants W. C. and C. Falcon, son and father, are appended, as makers, to said notes.
The petition is in two counts. The note in Count 1 is for $ 2,500, dated September 13, 1918, and due on or before six months after said date. The note in Count 2 is for $ 2,000, dated May 2, 1922, and payable six months after said date.
The defendant W. C. Falcon defaulted, but the defendant C. Falcon filed his verified answer, in which he denied that he signed the said notes at the time of their execution, or that he was a party to the transactions giving rise to said notes. He further averred that, while said notes were in the hands of the plaintiff, at the request of the plaintiff, but without consideration therefor, he affixed his signature thereto, and that, by reason of the fact that the signature thereto was without consideration, he is not liable to plaintiff thereon.
Thereafter, to wit, January 18, 1926, and on the day said cause was called for trial, the defendant C. Falcon filed his verified amendment to his answer, in which he alleged that the said notes were signed by him long after their delivery, and without his having any part in the original transactions, and "without the knowledge of the maker thereof, W. C. Falcon," and that, as a consideration for the signature of C. Falcon, the defendant, it was expressly verbally agreed by and between the plaintiff and C. Falcon that the said notes should not become due and payable as to this defendant until the death of this defendant, and should be payable out of his estate after his death; and for this reason that said notes are not due as to C. Falcon, the defendant, and that said suit is prematurely brought as to this defendant.
On the day said cause proceeded to trial, to wit, January 19, 1926, plaintiff filed written dismissal of the cause of action as to the defendant W. C. Falcon, and thereupon plaintiff offered and introduced in evidence, without objection, the notes in controversy, and rested. The defendant C. Falcon then introduced evidence on his behalf, the material part of which was objected to by plaintiff. These matters will be presently noted, but certain legal propositions should first be reviewed.
We are first confronted with what are termed "inconsistent defenses." Under the statute, "inconsistent defenses may be stated in the same answer or reply, and when a verification is required, it must be to the effect that the party believes one or the other to be true, but cannot determine which." Section 11199, Code of 1924. A verification was not required in this case.
It is apparent that the defendant did plead inconsistent defenses. This was his right. Heinrichs v. Terrell, 65 Iowa 25, 21 N.W. 171. However, on the theory of logic that a thing either is or is not, we have held that the statutory provision does not permit inconsistent defenses when one is destructive of the other. Crawford v. Nolan, 70 Iowa 97, 30 N.W. 32; Taylor v. Chicago, St. P. & K. C. R. Co., 76 Iowa 753, 40 N.W. 84; Burns v. Chicago, Ft. M. & D. M. R. Co., 110 Iowa 385, 81 N.W. 794; Seymour v. Chicago & N.W. R. Co., 181 Iowa 218, 164 N.W. 352. In the light of the record before us, this latter principle is not a matter of grievous concern here.
The first defensive plea is not that the notes are without consideration, but that the signature of C. Falcon thereon is without consideration. This is not true as a matter of law, since his signature to the notes in suit was affixed after the delivery of the notes by the original maker to the plaintiff, and after their due date, and without the consent or authorization of the original maker.
Under this state of the record, the act of C. Falcon in signing the notes released W. C. Falcon from liability thereon. It may not be said that no one was released from the original obligation, or that, unless a new consideration is shown, the payee occupied the same position after the signature was affixed as he did prior thereto. The defendant C. Falcon voluntarily assumed the obligation, and the legal effect of his act was to execute new notes at the time he subscribed his name, and, as a maker, he is liable in the absence of a pleaded and proved defense. Dickerman v. Miner, 43 Iowa 508; Rhoades v. Leach, 93 Iowa 337, 61 N.W. 988.
The Negotiable Instruments Statute provides that an instrument is materially altered when there is any alteration which changes the number or the relations of the parties, or by any other change or addition which alters the effect of the instrument in any respect; and further, where a negotiable instrument is materially altered without the assent of all parties liable thereon, it is avoided, except as against a party who has himself made, authorized, or assented to the alteration, and subsequent indorsers. Sections 9585 and 9586, Code of 1924.
The signature of C. Falcon on the notes imports a sufficient consideration. The notes were signed by C. Falcon in August 1923, after their due date. There was, at that time, a contract in existence between the payee and W. C. Falcon, the maker of the notes. See Devoy & Kuhn C. & C. Co. v. Huttig, 174 Iowa 357, 156 N.W. 412.
The numerical weight of authority sustains the view that the notes were altered by the addition of the name of C. Falcon to that of the sole original maker, W. C. Falcon, subsequent to their delivery, without the knowledge or consent of the original maker. See Farmers' & Merch. Bank v. Parker, 150 Tenn. 184 (263 S.W. 84, 35 A. L. R. 1253).
There was no plea of conditional delivery. Section 9476, Code of 1924. It is true that absence or failure of consideration is a matter of defense as against any person not a holder in due course. Section 9488, Code of 1924. But under the proof offered, the plea that said notes were not signed by the defendant C. Falcon at the time of their execution availed nothing to him.
The crux of this case, therefore, involves the defensive plea of an express oral contract between the defendant C. Falcon and the payee at the time the signature of C. Falcon was affixed to the notes. The defendant offered evidence, under proper and timely objection on the part of the plaintiff, that he had an agreement with the payee that the notes were not due and payable until the death of the defendant C. Falcon, the new maker. Was this...
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