Marling v. Fitzgerald

CourtUnited States State Supreme Court of Wisconsin
Writing for the CourtMARSHALL
Citation138 Wis. 93,120 N.W. 388
Decision Date16 February 1909
PartiesMARLING v. FITZGERALD ET AL.

138 Wis. 93
120 N.W. 388

MARLING
v.
FITZGERALD ET AL.

Supreme Court of Wisconsin.

Feb. 16, 1909.


Appeal from Circuit Court, Milwaukee County; Warren D. Tarrant, Judge.

Action by Celia Ellis Marling against Charles Fitzgerald and others. From an adverse judgment, plaintiff appeals. Reversed and remanded, with directions.

Action to foreclose a mortgage.

The issues raised by the pleadings were closed by findings of fact, which may be presented,

[120 N.W. 389]

as follows: March 19, 1903, defendant Charles Fitzgerald, the then owner of the premises described in the complaint, duly mortgaged the same to defendant Herman to secure payment of said defendant's note of like date, for $3,000, payable to the order of said Herman, three years after date, with interest at the rate of 5 per cent. per annum, and said mortgage was duly recorded. The transaction occurred pursuant to an application by said defendant to said Herman for a loan of $3,000, to be used in the erection of a building on the mortgaged premises, the money to be advanced as fast as the improvement progressed. Upon the delivery of the note and mortgage to Herman, he delivered to said defendant an acknowledgment of the purpose thereof and, in effect, that he was indebted to said defendant to the amount of the loan, payable as before indicated. March 20, 1903, said Herman borrowed of George Ellis $1,900, giving his promissory note therefor, payable three months after date, and for collateral security for the payment of the debt, delivered to said Ellis said first mentioned note and the mortgage, duly assigning the same in writing, but not so as to enable the said Ellis to record the assignment and it never was recorded. Before the commencement of the action plaintiff became the owner of said $1,900, note and succeeded to all rights of said George Ellis to said collateral security. The said $1,900, note is wholly unpaid as well as the interest thereon from its date. No part of said $3,000, loan was ever paid to said Fitzgerald, nor could he ever collect any part thereof. Herman was known to Fitzgerald, at the time the mortgage was given, to be engaged in dealing in notes and mortgages and in loaning money for himself and others on real estate security.

On such facts the court concluded: First, the note and mortgage were given without consideration; second, neither said Ellis nor plaintiff took said note in due course so as to be entitled to the protection of the law merchant; third, the latter holds the same subject to equities and defenses, including the defense of failure of consideration, which said Fitzgerald would have, had the security remained in the hands of said Herman, and is, therefore, not entitled to enforce the same at all, and is liable to Fitzgerald for his costs and disbursements in the action.

Judgment against plaintiff was rendered accordingly and was so rendered.

Goff, Hayes & Hannan, for appellant.

Dorr & Gregory, for respondents.


MARSHALL, J. (after stating the facts as above).

The foregoing statement presents this proposition: If A. mortgages his property to B. to secure a loan of money, to be advanced from time to time, knowing that he is a dealer in such securities, B. agreeing to make the advancements at times and in a manner specified, and in harmony with the understanding between the parties placing the mortgage upon record, acquiring the status as to all the world of being the owner of the securities and a debtor to A. for the money agreed to be advanced, and thereafter B. for value, sells and duly assigns such securities to C., who takes the same without knowing of the relation of debtor and creditor between A. and B. under the agreement as to the advancement of money, the transaction between B. and C. not being such as to give the latter the protection of the law merchant, and B., neither before the assignment nor thereafter, advances the money or any part thereof to A. and wholly breaches his agreement in that regard, can C., nevertheless, enforce the note and mortgage against A.?

If the proposition as stated be answered in the negative, as counsel for respondents contend it should be, and the learned circuit court decided, the judgment must be affirmed. If, on the contrary, it be answered in the affirmative, as counsel for appellant contend it should be, the judgment must be reversed and the cause be remanded for judgment according to the prayer of the complaint.

The situation is governed by a few plain legal principles in respect to which the learned circuit court went astray.

Manifestly, the note was not without consideration to support it, merely because the money called for thereby was not advanced at the time it was given, nor at all. The agreement to advance the money, and the creation of the relations of debtor and creditor between Herman and Fitzgerald, were amply sufficient to support the note, respecting the consideration feature, as the actual transition of the money from the former to the latter at the time the securities were delivered by the one to the other, would have been. That is too manifest to require discussion. The learned trial court, it seems, failed to distinguish between delivery of a note and mortgage by the payor to the payee for money to be advanced subsequently, the security to take effect presently, and delivery thereof, but not to take effect till performance of a specified condition, as to making the advancement. In the former circumstances, the security would be a valid obligation from the start, but in the latter, performance of the condition would be essential to such validity. Nutting v. Minn. Fire Ins. Co., 98 Wis. 26, 73 N. W. 432;Thorne v. Ætna Ins. Co., 102 Wis. 593, 78 N. W. 920;State ex rel. Jones v. Chamber of Commerce, 121 Wis. 110, 98 N. W. 930;Golden v. Meier, 129 Wis. 14, 107 N. W. 27, 116 Am. St. Rep. 935;Hodge v. Smith, 130 Wis. 326-333, 110 N. W. 192;Ware v. Smith, 62 Iowa, 159, 17 N. W. 459;Belleville Savings Bank v. Bornman, 124 Ill. 200, 16 N. E. 210;Merchants' Exch. Bank v. Luckow, 37 Minn. 542, 35 N. W. 434;Burke v. Dulaney, 153 U. S. 228, 14 Sup. Ct. 816, 38 L. Ed. 698.

[120 N.W. 390]

Again the learned circuit court misapprehended the law in assuming, if the note would be subject to defenses as between Fitzgerald and Herman, because of the latter not having kept his agreement with the former by advancing the money, the former could, under all circumstances, including the taking of the securities...

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35 practice notes
  • Bremer v. St. Paul City Ry. Co.
    • United States
    • Supreme Court of Minnesota (US)
    • 12 Marzo 1909
    ...be submitted to the jury under proper instructions; and it is error in such case for the court to direct a verdict for the defendant. [120 N.W. 388] In the light of these general principles and of these special authorities, the conclusion of the learned trial judge that plaintiff was not gu......
  • Portner v. Tanner, 1060
    • United States
    • United States State Supreme Court of Wyoming
    • 17 Julio 1923
    ...243; Hamer v. Sidway, 27 N.E. 256, 124 N.Y. 538; Bolles v. Sachs, 33 N.W. 863; Pierce v. Stolhand, 124 N.W. 259; Marling v. Fitzgerald, 120 N.W. 388.) The promise of the defendant to pay the checks was an independent contract. (Emerson v. Slater, 22 How. 43, 16 L. ed. 365; Violett v. Patton......
  • Kimball v. Baker Land & Title Co.
    • United States
    • United States State Supreme Court of Wisconsin
    • 18 Febrero 1913
    ...any right or title to the land as against Hanna. Lyndon L. Co. v. Sawyer, 135 Wis. 525, 116 N. W. 255;Marling v. FitzGerald et al., 138 Wis. 93, 120 N. W. 388, 23 L. R. A. (N. S.) 177, 131 Am. St. Rep. 1003;Wright L. Co. v. McCord, 145 Wis. 93, 128 N. W. 873, 34 L. R. A. (N. S.) 762;North v......
  • Vogel v. Shaw, 1659
    • United States
    • United States State Supreme Court of Wyoming
    • 30 Diciembre 1930
    ...42 L. R. A. 794; Canal Co. v. Hathaway, (N. Y.) 24 Am. Dec. 51, 10 R. C. L. 675; Penn v. Heisey, 19 Ill. 295; Marling v. Fitzgerald, 120 N.W. 388. No consideration is necessary where estoppel is pleaded, and proven. 10 R. C. L. 689, 21 C. J. 1120, 40 Cyc. 263; Carpy v. Dowdell, (Calif.) 41 ......
  • Request a trial to view additional results
35 cases
  • Bremer v. St. Paul City Ry. Co.
    • United States
    • Supreme Court of Minnesota (US)
    • 12 Marzo 1909
    ...be submitted to the jury under proper instructions; and it is error in such case for the court to direct a verdict for the defendant. [120 N.W. 388] In the light of these general principles and of these special authorities, the conclusion of the learned trial judge that plaintiff was not gu......
  • Portner v. Tanner, 1060
    • United States
    • United States State Supreme Court of Wyoming
    • 17 Julio 1923
    ...243; Hamer v. Sidway, 27 N.E. 256, 124 N.Y. 538; Bolles v. Sachs, 33 N.W. 863; Pierce v. Stolhand, 124 N.W. 259; Marling v. Fitzgerald, 120 N.W. 388.) The promise of the defendant to pay the checks was an independent contract. (Emerson v. Slater, 22 How. 43, 16 L. ed. 365; Violett v. Patton......
  • Kimball v. Baker Land & Title Co.
    • United States
    • United States State Supreme Court of Wisconsin
    • 18 Febrero 1913
    ...any right or title to the land as against Hanna. Lyndon L. Co. v. Sawyer, 135 Wis. 525, 116 N. W. 255;Marling v. FitzGerald et al., 138 Wis. 93, 120 N. W. 388, 23 L. R. A. (N. S.) 177, 131 Am. St. Rep. 1003;Wright L. Co. v. McCord, 145 Wis. 93, 128 N. W. 873, 34 L. R. A. (N. S.) 762;North v......
  • Vogel v. Shaw, 1659
    • United States
    • United States State Supreme Court of Wyoming
    • 30 Diciembre 1930
    ...42 L. R. A. 794; Canal Co. v. Hathaway, (N. Y.) 24 Am. Dec. 51, 10 R. C. L. 675; Penn v. Heisey, 19 Ill. 295; Marling v. Fitzgerald, 120 N.W. 388. No consideration is necessary where estoppel is pleaded, and proven. 10 R. C. L. 689, 21 C. J. 1120, 40 Cyc. 263; Carpy v. Dowdell, (Calif.) 41 ......
  • Request a trial to view additional results

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