Fant v. Miller & Mayhew

• Decision Date: 06 October 1866
• Citation: 58 Va. 47
• Parties: FANT & als. v. MILLER & MAYHEW.
• Court: Virginia Supreme Court

58 Va. 47

FANT & als. v. MILLER & MAYHEW.

Supreme Court of Appeals of Virginia.

October 6, 1866

1. A plea of usury of a foreign state, must state what the law of usury is in that state.

2. In an action of debt upon a negotiable note, the defence that the plaintiffs are not holders for value of the note, may be made under the plea of nil debet.

3. A special plea is demurred to and the demurrer is sustained. At the same term, on motion of plaintiffs, the order is set aside, the defendants withdraw their joinder in the demurrer the plaintiffs withdraw their demurrer, and then move the court to strike out the plea; which is done. The plea being defective, or setting up a defence which may be made under the general issue, which is then in the record, the striking out the plea does the defendants no injury, and is not error.

4. QUAERE: Whether on a trial at law the construction and effect of the law of a foreign state are to be determined by the jury or by the court.

5. In an action at law upon a note executed in a foreign state, the defendant moves to exclude the note as evidence, because by the law of the state where it was made, it was not competent evidence; and he offers the statute of that state in evidence upon that motion, which is rejected; the court being of opinion that the note might be read in evidence notwithstanding the provisions of the statute. If the court gave the correct construction to the statute, the rejection is not ground for reversing the judgment, though it were held that it was for the jury to construe the statute.

6. If the law of the state where a note is made, declares that it shall be void unless it is stamped, it is void everywhere and an action cannot be maintained upon it in another state.

7. If in such a case the law only declares that the note shall not be available as evidence, an action may be maintained upon it in another state.

8. The stamp act of the state of Maryland does not avoid the instrument, but renders it unavailable as evidence; and an action may be maintained in Virginia upon a note made in Maryland; though it has not been stamped as required by the Maryland statute.^[a1]

9. A paper signed in blank in Virginia is sent to Maryland to be filled up there. It is filled up there, and at the same time and place is endorsed by the payee to the holders, for value; the note being in fact for the accommodation of the payee. This is a Maryland contract to be governed by the Maryland law; though the note is headed W, a place in Virginia.

10. By the usury law of Maryland a contract or evidence of debt though tainted with usury, is not null and void, but is a valid contract, upon which an action may be maintained to recover the principal and six per cent. per annum interest thereon; and is void for the excess.

11. In an action in Virginia upon a note made in Maryland, on which more than six per cent. per annum of interest was charged, the plaintiff may recover the principal and six per cent. per annum; and where a separate note was given for the excess of interest, which is still in the hands of the plaintiff unpaid, he will be permitted to recover the principal of the note sued on and six per cent. per annum interest thereon.

12. Negotiable notes made for the accommodation of F are endorsed by him to the holders in consideration of money previously advanced by them to him, of money advanced to him at the time of the transfer, and of notes of F falling due at a future day, which they undertake to pay and do pay as they fall due all of which amount to the full amount of the notes so endorsed to them. The holders are holders for value.

This was an action of debt in the Circuit court of Fauquier county, brought by Miller & Mayhew, of Baltimore, against John L. Fant and William F. Phillips, upon a negotiable note of three thousand seven hundred and fifty dollars. The action was one of four which were tried together, brought by the plaintiffs against the defendants, upon four notes for the same amount made by the defendants to E. L. Fant & Co., and endorsed by E. L. Fant, by the name of E. L. Fant & Co.; that being the name under which he did business.

In April, 1857, the plaintiffs recovered a judgment in the case against the defendants, which, upon an appeal to this court was reversed in May, 1858; and the cause was sent back for a new trial. The grounds of this appeal was the exclusion of the following letter from E. L. Fant to the defendant John L. Fant.

BALTIMORE, June 7th, 1850.

Dear Father: I write in great haste. I have made a new arrangement with Miller & Mayhew, and have determined to go on again; they to advance me what money I want; but they say the amount is large, and want me to borrow for them your four blank notes, to be signed by yourself first and uncle William last; as they say they want them to raise money upon. They are only loaned to them, and are secured by the collaterals that I have placed with them, which amount to sixty thousand dollars. You can run no risk, either of you. Sign above the last line and let uncle William sign under your name, and send them back by mail. No trouble, I assure you both, can come to either of you, as Mr. Miller says he will see me through, and advance me all the money I want; and as the notes are loaned to Miller & Mayhew only, and for their accommodation, you see you can run no risk. I want your answer with the blank signatures by return mail.

Your affectionate son,

E. L. FANT.

MR. JOHN L. FANT,

Warrenton, Fauquier County, Va.

Endorsed--Baltimore, Md., June 7th.

On the first trial the issues were upon the pleas of " nil debet " and " " " " usury." After the cause went back, the defendants filed six special pleas. Five of these pleas set up in different forms and more or less detail the defence based upon the letter of E. L. Fant to his father, that the note sued on was signed by the defendants in blank, and sent to E. L. Fant, to be filled up and delivered to Miller & Mayhew, as a loan to them for their accommodation, and without consideration therefor, either from E. L. Fant or the plaintiffs. The sixth plea, after reciting the application to the defendants by E. L. Fant for their notes as a loan to the plaintiffs for their accommodation, and their signing the blanks and sending them to E. L. Fant, to be filled up and delivered by him to the plaintiffs as a loan to the plaintiffs, proceeds: The said plaintiffs caused and procured the said note in their declaration mentioned, to be written upon one of the said four pieces of paper, over the names of the defendants so signed as aforesaid, and procured the same to be endorsed by the said E. L. Fant & Co., and delivered to them in consideration of a loan of money by the said plaintiffs to the said E L. Fant & Co.; upon which loan the said plaintiffs received a greater rate of interest than six per centum per aunnm; and so the said defendants say that the said plaintiffs are not and never have been bona fide holders for value of the said note in their declaration mentioned; and this they are ready to verify, & c.

The plaintiffs filed special replications to the first five special pleas, in which they denied any knowledge of the letter of E. L. Fant, or that the notes were lent to them for their accommodation; and averred that the notes were endorsed by E. L. Fant & Co. to the plaintiffs for full and valuable consideration. And upon these replications issues were made up. To the sixth plea the plaintiffs demurred; and the court sustained the demurrer.

At the same term of the court, on the motion of the plaintiffs, the order sustaining the demurrer was rescinded; and thereupon the defendants by leave of the court withdrew their joinder in the plaintiffs' demurrer to the sixth plea; and the plaintiffs thereupon withdrew their demurrer to that plea. And the plaintiffs then moved the court to strike out the said sixth special plea of the defendants, and the court sustained the motion and struck out the plea.

The cause came on for trial at the April term 1860, when there was a verdict and judgment for the plaintiffs for three thousand seven hundred and fifty dollars, with six per cent. per annum interest from the 21st day of January, 1851, until paid, and their costs.

On the trial of the cause the defendants filed two bills of exception to rulings of the court, and also filed a bill of exception to the refusal of the court to grant a new trial. The first was, that the plaintiffs having read in evidence to the jury the note and the endorsement thereon, on which the suit was brought, the defendants moved the court to exclude the note from going in evidence to the jury, because by the law of Maryland the paper on which it was written had not been stamped, pursuant to the stamp act of Maryland; and to that end offered to read in evidence to the jury the stamp act of the state of Maryland, which was admitted to have been the law of the state of Maryland at the date of the note; and to the introduction of which the plaintiffs objected. And the court being of opinion that the said note might be read in evidence in this state, notwithstanding the provisions of the Maryland statute, sustained the plaintiffs' objection, and excluded the said law from being given in evidence to the jury. For the provisions of the statute see the opinion of Judge JOYNES.

When all the evidence had been introduced, the defendants moved the court to give nine several instructions to the jury. Of these the first six were given. The third instruction was " If the jury believe from the evidence that the note in the declaration mentioned was endorsed and delivered by the said E. L. Fant to the plaintiffs on a usurious consideration, then the plaintiffs are not bona fide holders of said note."...