Mathews v. Wayne Junction Trust Co.
| Decision Date | 24 June 1912 |
| Docket Number | 1,450. |
| Citation | 197 F. 237 |
| Parties | MATHEWS v. WAYNE JUNCTION TRUST CO. |
| Court | U.S. District Court — Eastern District of Pennsylvania |
Alfred I. Phillips and Dimner Beeber, both of Philadelphia, Pa., for plaintiff.
J. W Bayard and J. G. Johnson, both of Philadelphia, Pa., for defendant.
In harmony with the authorities, it is agreed by both parties that neither a plaintiff nor a defendant may found his case either in whole or in part, upon a fraudulent transaction although his antagonist may have participated therein. It is no doubt true that, although both may have joined in the fraud, a plaintiff may nevertheless recover if he is able to make out his case without calling upon the fraud for help but he must fail if such help is indispensable. In the present dispute the plaintiff is receiver of the insurance company that was party to the fraud in question, and it is obvious I think that, although to some extent he may be the representative of creditors, he must accept the consequences of the undeniable fact that the company did participate in the fraudulent transaction. Whatever burden that fact imposes, he must of necessity bear; otherwise, his appointment would in effect transform the fraud into an innocent agreement, thus making a new contract between the company and the defendant. The case now under examination differs from the situation usually presented only in the fact that the plaintiff did not encounter the need of disclosing the fraud until the rebuttal stage of the trial. He put in evidence the trust company's certificate of deposit, regular and innocent upon its face, and, having thus made out a prima facie case, awaited the defense. Thereupon the trust company put in evidence an ordinary collateral note, accompanied by a contract in writing, also regular and innocent upon its face, and these papers answered completely the plaintiff's prima facie evidence. Up to this point no fraud had appeared, and if the case had gone to the jury at that stage the plaintiff could not have recovered. He was therefore compelled to turn in rebuttal to the fraudulent transaction, and for the first time that transaction was brought into the controversy. I thought at the trial, and after argument and further reflection I still think, that the rule of law referred to bound the plaintiff as much at that stage of the clause as it would have bound him if he had offered to prove the fraud...
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