Hancock v. Empire Cotton Oil Co

• Court: United States Court of Appeals (Georgia)
• Citation: 86 S.E. 434,17 Ga.App. 170
• Docket Number: (No. 6107.)
• Parties: HANCOCK. v. EMPIRE COTTON OIL CO.
• Decision Date: 23 September 1915

86 S.E. 434
17 Ga.App. 170

HANCOCK.
v.
EMPIRE COTTON OIL CO.

(No. 6107.)

Court of Appeals of Georgia.

Sept. 23, 1915.

(Syllabus bp the Court.)

Error from City Court of Jefferson; G. A. Johns, Judge.

Action by the Empire Cotton Oil Company against Claud Hancock. Judgment for plaintiff, and defendant brings error. Affirmed.

P. Cooley, of Jefferson, and H. H. Dean, of Gainesville, for plaintiff in error.

Green, Tilson & McKinney and L. G. Fortson, all of Atlanta, and J. S. Ayers, of Jefferson, for defendant in error.

WADE, J. The Empire Cotton Oil Company brought suit against Hancock on a certain promissory note, signed by him, payable to the order of Carr, Boyd & Co., and indorsed "Carr, Boyd & Co., per B. F. Carr, " dated June 17, 1912, and due January 1, 1913, for $856.25 and interest from maturity at 8 per cent. The defendant interposed a plea under oath at the first term, alleging that he signed in blank two notes and delivered them to B. F. Carr, but that neither of them was to be filled out by Carr for the sum of $856.25, and that neither was to be used until

[86 S.E. 435]

further notice, and that Carr was notified before the notes were filled out and made payable to any one not to use them. The plea further alleged that the defendant "did not execute any note to Carr, Boyd & Co. in any sum whatever, " and that the note sued upon was not in the hands of the plaintiff as a bona fide holder for value; that there was no consideration for the note at the time it was made, and the plaintiff had notice of this fact at the time it accepted the note; and further that the note was never indorsed by Carr, Boyd & Co. to the plaintiff, and did not then bear the genuine indorsement of Carr, Boyd & Co., and the plaintiff held no legal title thereto. By amendment the defendant struck the word "delivered" in the original plea, and substituted in lieu thereof the word "handed, " so that the allegation in the plea amounted to a statement that the defendant signed two blank notes and "handed" the same to B. F. Carr, instead of "delivering" the same.

By further amendment the defendant alleged that the note sued upon was never executed by him, or by any person by him authorized, and was not his act or deed; that he did not fill out the note, and did not authorize any one else to fill it out, either for $850.25 or for any other amount; "that on or about the 16th day of June, 1912, he signed, or placed his name on, what purported to be a blank note, without any amount being specified therein, or containing any writing whatever, and being nothing but a blank paper with this defendant's name placed thereon; that he handed said paper, or blank alleged note, to B. F. Carr to hold and keep as an escrow awaiting further instructions from this defendant, and with positive instructions that the said B. F. Carr should not fill in said alleged note in any amount whatever, or use the same in any way unless thereafter authorized by this defendant to do so, and that the said B. F. Carr then and there, at the time of receiving said note, agreed with this defendant that he would not fill in said alleged blank note, or blank paper, for any amount, or put any writing whatever upon said alleged note, unless and until authorized by this defendant that he could do so;" that a day or two after the execution of this note in blank he notified B. F. Carr to return the note to him or to destroy it, and not to fill it out for any amount whatever, or to use it "in any way, shape, or form whatever, " and that Carr then and there notified him that he would not use the note, and had not used it, and would destroy it as directed.

The plea expressly denied that the defendant had ever delivered the note to Carr, or considered it delivered to him, and alleged that Carr was notified "that he was to hold the same as an escrow purely, as agent of defendant, and not to fill in the same or use the same in any way until permitted to do so by this defendant, " and the filling out of the note, the indorsement of the same, and the delivery thereof to the Empire Cotton Oil Company, was without any authority on the part of the defendant, without any consideration or knowledge on his part, and was a fraud upon him; that the Empire Cotton Oil Company paid nothing for the note, was not an innocent purchaser or innocent holder of the same, and the note was without consideration, either as between the defendant and B. F. Carr, or Carr, Boyd & Co., or as between the defendant and the Empire Cotton Oil Company; that the defendant did not owe B. F. Carr, or Carr, Boyd & Co., any sum whatever at the time the said note was signed, and had not become indebted to them in any sum since that date; that he received no value for the said note, and never delivered it, except as an escrow; that the note was void for want of consideration, void for want of delivery, and void because it was not the instrument signed by the defendant, as the writing of the name, the date, the amount, the rate of interest, and any writing therein, was without authority and against the positive instructions of the defendant; that the Empire Cotton Oil Company merely claimed to hold this note as collateral for indebtedness already existing between Carr, Boyd & Co. and the Empire Cotton Oil Company, and the said Empire Cotton Oil Company paid nothing for the note, and had no right to hold or collect it from the defendant.

On the trial of the case, the note sued upon was offered in evidence without objection by the defendant, and appeared to have been signed by the defendant, to be payable by its terms to the order of Carr, Boyd & Co., to be dated June 17, 1912, and due January 1, 1913, to provide for interest from maturity at the rate of 8 per cent. per annum, and for 10 per cent. as attorney fees, and to be indorsed, "Carr, Boyd & Co., per B. F. Carr." It was shown by the testimony of the defendant that, on or about the date on which the note sued upon was executed, B. F. Carr, of the firm of Carr, Boyd & Co., who was connected with the defendant by marriage, came to the defendant's home, and, after stating that he was in financial straits and needed money, requested the defendant to sign two accommodation notes payable to his firm; that the defendant complied with the request, to the extent that he appended his signature to two printed blank notes, in which neither the amount to be paid nor any other writing appeared; that he handed these notes to Carr with the distinct understanding and agreement that Carr should hold them until the defendant gave him further notice, the defendant agreeing to call him up by telephone and instruct him the following day whether to use the note or not; that in the event he should afterwards agree that the notes should be filled in and used they were

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to be filled in for $750 each; that on the following day he went "to town" and called up Carr as agreed, and talked to him over the telephone, recognizing Carr's voice, and then instructed Carr not to use either note, and Carr then and there agreed that he would not do so; that a day or two later he saw Carr in person, and Carr told him he had not filled in the notes in question, and agreed that he would destroy or return them to the defendant; that at no time did Carr ever have authority to fill in these notes as his agent or otherwise, but Carr was distinctly informed, when the notes were first delivered to him, that he should not use them without further authority from the defendant, and before they were used he notified Carr that they could not be used; that he neither owed the Empire Cotton Oil Company nor Carr, Boyd & Co., any sum whatever at the time the notes were given or afterwards. On cross-examination the defendant testified as follows:

"i signed that note; that looks like my signature. At the time it was like this, except it has been filled in in the blank spaces. Carr told me that he wanted to use it when i signed it. i saw him two days later. i was in Jefferson when I called him up, and two days later I saw Mr. Carr, and Mr. Carr told me that he thought he had destroyed the notes. i don't remember what i did with that note i took to hold against it. I have the note. i think it is down here at the Jefferson Banking Company. It is over there, or at my house. It was not taken the same day. The note may possibly be in the hands of Col. Cooley [one of the counsel for the defendant]. I can't say positively where the note is. I still have the note. In the beginning I did tell Carr that he could fill the note out for $750; that was the amount that was agreed upon at the time. Instead of filling it out for that amount, gone $126.56 more. Mr. Carr married my cousin."

On redirect and recross examination it appeared that some time after the execution of the two notes, one of which is the note sued upon, Carr, Boyd & Co. gave to the defendant the note referred to in his redirect testimony as a "counter note, " designed to evidence the liability of Carr, Boyd & Co. to the defendant for the amount of the two notes signed by him in blank and delivered to Carr for Carr, Boyd & Co., and to indemnify the defendant against any loss thereon. The defendant again expressly denied that he had ever invested Carr with any authority to fill out the note for $750 (which was actually filled out for $856.25 and thereafter sued upon by the plaintiff), unless Carr should be further empowered by him to do so, and, if he allowed Carr to use the note at all, that he was to use it for $750 only. He said:

"I did not use any counter note. I did not get any note from Carr, Boyd & Co. at the time this other note was given. At another time I did give Carr, Boyd & Co. another note, which they did use; I didn't get a counter note at the time, but later I did get a counter note."

He said, further, that at the time he took the counter note he did not know that the note sued for was outstanding, but thought it had been destroyed; that then he...