Hotel Lanier Co v. Johnson

• Decision Date: 22 March 1898
• Parties: HOTEL LANIER CO. v. JOHNSON.
• Court: Georgia Supreme Court

30 S.E. 558

103 Ga. 604

HOTEL LANIER CO.

v.JOHNSON.

Supreme Court of Georgia.

March 22, 1898.

Note—Alteration—Construction—Rights of Purchaser.

1. Under section 3702 of the Civil Code, an alteration in a promissory note will not necessarily discharge the maker from all liability thereon, unless such alteration was material, and made by a person claiming a benefit under the note, with intent to defraud.

2. A promissory note, payable generally "after date, " and not otherwise expressing any time for payment, is payable on demand, and therefore, under section 3700 of the Civil Code, due immediately.

3. The purchaser of such a note, even if the same is by its terms a negotiable instrument, takes it subject to the equities between the original parties.

4. The foregoing is applicable to the notes sued on in the present case, and the same haying been tried upon an erroneous theory with regard to the maturity of such notes, and the court having consequently excluded evidencerelevant and material to the defense, there should be a new hearing.

(Syllabus by the Court.)

Error from superior court, Bibb county; W. H. Felton, Jr., Judge.

Action by Mrs. T. M. Johnson, as administratrix of the estate of Edward C. Johnson, deceased, against the Hotel Lanier Company and H. S. Morse. Judgment for plaintiff, and defendant company brings error. Reversed.

Dessan, Bartlett & Ellis and Minter Wim-berly, for plaintiff in error.

Bacon, Miller & Brunson, for defendant in error.

LUMPKIN, P. J. The administratrix of Edward C. Johnson brought an action against the Hotel Lanier Company, a partnership, as maker, and H. S. Morse, as indorser, upon two promissory notes payable to the order of the latter. Each of these notes was dated January 2, 1894, due, generally, "after date, " and signed, "Hotel Lanier Co., by Sam Altmayer, Secty. & Treas." The hotel company pleaded, in substance, that the notes sued on were not executed by it, nor by any person authorized by it to do so; that, if the same were executed in the name of the company by Altmayer, his act in so doing was not the act of the company, not being within the legitimate scope of the business of the partnership, and consequently it was not bound thereby; that the notes, as to the company, were without any consideration whatever, and that if Johnson, the plaintiff's intestate, purchased these notes, he did so after they became due, with full notice of the above-recited facts.

1. The first of the above-mentioned defenses seems to have been intended and treated by counsel for the defendant, not as a strict plea of non est factum, but as one, in effect, alleging alterations in the notes after their execution. Accordingly, evidence was offered to prove that the following clause in each of the notes, to wit, "with interest at six per cent. per annum, " and the date of each, "January 2d, " were forgeries, and were not parts of said notes at the time the same were signed. Exception is taken to the rejection of this testimony. There being no offer in this connection to prove that the alleged alterations were fraudulently made by a person claiming a benefit under the notes, it does not appear that rejecting the evidence above indicated resulted in any injury to the defendant, even if the same, in the absence of a plea specially alleging that the alterations were material, fraudulent, etc., was admissible at all. Under section...