McConkie v. Babcock

• Decision Date: 02 February 1897
• Citation: 101 Iowa 126,70 N.W. 103
• Parties: MCCONKIE v. BABCOCK.
• Court: Iowa Supreme Court

101 Iowa 126

70 N.W. 103

MCCONKIE

v.BABCOCK.

Supreme Court of Iowa.

Feb. 2, 1897.

Appeal from superior court of Cedar Rapids; Thomas M. Giberson, Judge.

This is an action upon a promissory note for $250, executed March 6, 1894, by the defendant to one Rudd Dent, and by him assigned to the plaintiff. The note was due May 6, 1894. To the petition on the note the defendant answered, in substance, admitting the execution of the note, and pleading a failure of consideration. He also alleged that plaintiff took the note with knowledge of all of the facts, and was not a bona fide purchaser. In a reply the plaintiff denies all notice or knowledge that the consideration of the note had failed, and alleges that he purchased the note before its maturity, without notice, and is an innocent holder thereof for value. The cause was tried to the court and a jury, and a verdict returned for the full amount of the note and interest, upon which a judgment was entered. Defendant appeals. Affirmed.C. J. Deacon, for appellant.

John M. Redmond, for appellee.

KINNE, C. J.

1. Defendant, at the close of the testimony, moved the court to instruct the jury to return a verdict for him. The motion, which was overruled, was based upon the grounds--First, that the undisputed evidence showed that there was no consideration from Dent to Babcock for the note in controversy; second, that it appeared from the undisputed evidence that plaintiff was not the purchaser of the note for a valuable consideration in the usual course of trade; and, third, that it likewiseappeared that plaintiff was not the purchaser of the note for value, and before maturity, without notice of the failure of consideration. Some of these same questions were raised, also, upon rulings upon instructions asked and refused, as well as upon those given in the charge of the court. The jury, in answer to a special interrogatory, found that there was a consideration for the note sued upon. It appears that one Dent, the payee of this note, was the owner of what was known as the Merchants' Specialty Company and its business; that he made certain representations to the defendant as to the prospects and condition of said concern, the amount of property it had on hand, and that it was all paid for; that certain goods had been ordered and paid for, and that he had orders from responsible parties for $1,300 worth of goods, upon which there would be $700 profit; that the goods sold readily on the market at a good profit, and he had a good trade worked up for the same; and other representations, on the faith of which defendant purchased a one-half interest in the business, paying therefor $750 in cash and also giving the note in suit. Some of these representations were undoubtedly false. As to others there is some testimony which may have warranted the finding of the jury that there was a consideration for the note. While, sitting as a jury, we should not have made the finding they did, still it is not so lacking in support in the evidence as to justify us in disturbing the verdict in that respect. There is evidence tending to show that, at about the time the note was transferred, the defendant still thought he had made a good investment. We cannot, in view of the evidence and special finding, hold that the note was without consideration.

2. As the jury found that there was a consideration for the note, and as we hold that the evidence is such that we may not disturb that finding, it is not material as to whether plaintiff was a purchaser for value in the usual course of trade; that is, as long as there was a consideration for the note, and it has been assigned to plaintiff, it is good in his hands, regardless of whether he took it simply to secure a pre-existing debt, or in so taking it made a valid agreement to extend the time of payment of the indebtedness, so as to make him a bona fide holder of the note for value. If there was a consideration for the note, then it is good in plaintiff's hands as security for Dent's debts to him, and may be enforced against the defendant.

3. The other question discussed by defendant's counsel, as to whether, when plaintiff took the note, he knew or had reason to know that it was without consideration, is disposed of by the finding of the jury that it in fact...