McMann v. Walker
| Decision Date | 05 May 1903 |
| Citation | 72 P. 1055,31 Colo. 261 |
| Parties | McMANN et al. v. WALKER. |
| Court | Colorado Supreme Court |
Error to Arapahoe County Court.
Action by R. H. McMann and others against James M. Walker. There was a judgment for defendant, and plaintiffs bring error. Reversed.
The defendant in error executed and delivered his promissory note, in the city of Denver, payable to the Sprague Collection Agency. The payee was a foreign corporation, and at the time of this transaction had not, nor has it since complied with the law requiring such corporations to pay certain fees before engaging in business in this state. Sess Laws 1897, p. 157, c. 51. Before maturity, the plaintiffs in error, for value, and without notice that the payee had not complied with the law relative to foreign corporations purchased the note from the payee in the city of Denver. In an action by the purchasers against the maker to enforce its collection, the trial court held that the note was void, and rendered judgment for the defendant. The plaintiffs bring the case here for review on error.
Goudy & Twitchell, for plaintiffs in error.
R. D Thompson and C.J. Blakeney, for defendant in error.
GABBERT J. (after stating the facts).
The only question necessary to determine is whether or not a negotiable promissory note in the hands of parties obtaining it for value, in good faith, before maturity, from a foreign corporation in this state, to which it was given in this state, is invalid as against the maker because such corporation, at the time of the execution and delivery of such note or subsequently, had not complied with the laws relative to the conditions which would authorize it to engage in business within the state. The question is one which has been discussed by the courts of several states, with the result that the decisions on the subject are not altogether harmonious. Whether or not the note in question be invalid as between the maker and payee is a question upon which we express no opinion, because that proposition is not involved and does not in any manner affect the rights of the parties to this action. The statute which the maker invokes does not provide that a note given a foreign corporation in the circumstances narrated shall be invalid in the hands of third parties, and it should not be given a construction, unless unavoidable, which would result in visiting upon innocent third parties a penalty for its violation by another. In this state the general rule of law prevails that negotiable commercial paper, although invalid as between the immediate parties, is valid as to third persons obtaining it for value before maturity, and without notice of its...
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McCornack v. Cent. State Bank
...weight of authority, which places the burden upon the drawee. The quotation in the dissent from McMann v. Walker is found in 31 Colo. 261, 72 P. 1055. The question involved in that case was whether a note executed to a corporation, not authorized to do business in the state of Colorado, was......
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McCornack v. Central State Bank
...contrary, is against the overwhelming weight of authority, which places the burden upon the drawee. The quotation in the dissent from McMann v. Walker is found in 31 Colo. 261 (72 1055). The question involved in that case was whether a note executed to a corporation not authorized to do bus......
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Callaway v. Hamilton Nat. Bank of Washington, 10908.
...payee had not complied with local laws for doing local business, where its endorsement was in all other respects regular. McMann v. Walker, 31 Colo. 261, 72 P. 1055; Betlyn Securities Corp. v. Bates, 177 Miss. 41, 170 So. 10 Where authority to sign exists, however, the endorsement's effecti......
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Butte Machinery Co. v. Jeppesen
...the stock is sold in violation of a statute, nor a circumstance charging the party with any duty of further inquiry. And in McMann v. Walker, 31 Colo. 261, 72 P. 1055, the grounds of defense were in part similar to the instant case, it is held that such a promissory note is valid in the han......