Kirby v. Berguin
| Decision Date | 01 March 1902 |
| Citation | 90 N.W. 856,15 S.D. 444 |
| Parties | KIRBY v. BERGUIN. |
| Court | South Dakota Supreme Court |
Appeal from circuit court, Minnehaha county.
Action by Joe Kirby against W. G. Berguin. From a judgment in favor of defendant, plaintiff appeals. Affirmed.
Joe Kirby, in pro. per. Davis, Lyon & Gates, for respondent.
This is an action by the plaintiff as indorsee of a negotiable promissory note executed by the defendant. The case was tried to a jury, and a verdict returned in favor of the defendant. From the judgment thereon, and an order denying a new trial the plaintiff has appealed.
The defendant, in paragraph 3 of his answer, alleged that his signature to the note sued on in this action was extorted from him by means of a fraudulent scheme, combination, and conspiracy on the part of William Barker, W. Bencliffe, C Schott, and William Cross to secure the signature of the defendant to said note for the purpose of disposing of the same to an innocent purchaser, and thereby defraud the defendant out of the amount of said note, and that in pursuance of such fraudulent combination, scheme, and conspiracy, the party calling himself William Cross called at the home of the defendant, and solicited from him an order for lightning rods to be placed on defendant's buildings and which order the said Cross represented to the defendant was for the sum of $20, the amount for which said Cross agreed to furnish said rods to the defendant; that on the following day, while the defendant was absent from home, Bencliffe and Schott, in pursuance of said fraudulent scheme and conspiracy, came to the defendant's premises and erected lightning rods on the same; that on the day following, for the purpose of further carrying out said fraudulent scheme and conspiracy, the said Bencliffe and Schott returned to the home of the defendant, and fraudulently claimed that there was due on the order for said lightning rods $187, and represented to the defendant, falsely and fraudulently, that the order he had given for said rods was negotiable, and threatened the defendant that if he did not settle said claim, and give his note therefor, they would sell and transfer said order to an innocent person, who would sue and collect the full amount of the same, but, in order to settle said claim, they stated they would accept a note for $140 signed by the defendant; that the said parties by artifice prevented the defendant from reading said order, and the defendant, relying upon said statements as to the contents of the same, and believing them to be true, and by reason of said threats, signed and delivered the note in suit in this action. Defendant further alleges in his answer that the plaintiff became the owner and holder of said note with the knowledge of the deceit, fraud, and conspiracy under which the same was extorted from the defendant.
There are a number of errors assigned, but they may be grouped under three heads: First, errors of the court in the admission of evidence; second, errors of the court in its charge to the jury; third, irregularity in the proceedings of the court and jury, by which plaintiff was prevented from having a fair trial.
On the trial the defendant, called as a witness in his own behalf, testified at considerable length to the conversations between himself and the parties mentioned in the answer, and the representations made by them, resulting in the giving of the note sued on in this action. The evidence so given tended to prove substantially the facts set up in the answer, but somewhat more in detail. This evidence was admitted over the objections of the plaintiff that the same was inadmissible for the reason that the order itself was not in evidence, and also because the same was incompetent, irrelevant, and immaterial. The appellant further contends that this evidence was inadmissible as it tended to vary the terms of a written contract. This contention is untenable, for the reason that the written contract or order given for these lightning rods is not before us, as it was not introduced in evidence by either party, and, for the purpose of proving that the note was obtained from him by fraud, it was competent for the defendant to show all the transactions between himself and the alleged conspirators, as to the manner of obtaining the note from him. It appears by the evidence of the defendant that the man claiming himself to be Cross came to his home and solicited the privilege of putting lightning rods upon his house and barn, stating that the same would not cost more than about $20, and induced the defendant to sign an order for said rods, representing to him that the amount specified in the order was the same as that above named. It seems quite clear from the evidence that this person giving his name as Cross was in fact William Barker, the man really engaged in the business of putting up lightning rods, and who transferred the note in suit to the plaintiff; that, on the day following, Bencliffe and Schott, in the absence of the defendant, put up the rods. On the following day Bencliffe and Schott returned, having in their possession what they represented to be the order, and claimed that there was due thereon the sum of $187, and further represented that the order was negotiable, and, if the defendant refused to pay it, they would transfer it to an innocent holder, and that the defendant would be compelled to pay the full amount, but, as a compromise, they offered to take his note for the $140; and, acting under the belief that the threats made by Bencliffe and Schott would be carried out, he executed the note in controversy, made payable to Schott, as payee. We are of the opinion that the evidence of the defendant was competent, relevant, and material, under the allegations of the answer, and the court committed no error in admitting the same.
It is contended on the part of the plaintiff that as he was a purchaser of the note in controversy before its maturity, for value, he was protected against the defense interposed by the defendant. But this court has held, following what it deems to be the weight of authority, that, where a negotiable instrument is shown to have been obtained by fraud, the burden of proof is upon the indorsee or holder to prove that he was a purchaser for value before maturity, in good faith and without notice. Landauer v. Improvement Co., 10 S.D. 205, ...
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