Merchants' Nat. Bank of Wimbledon v. Brastrup
| Decision Date | 06 May 1918 |
| Docket Number | 1915 |
| Citation | 168 N.W. 42,39 N.D. 619 |
| Court | North Dakota Supreme Court |
Rehearing denied May 28, 1918.
Action on a promissory note.
Defense of a material alteration.
Appeal from the District Court of Stutsman County, Honorable J. A Coffey, Judge.
Judgment for defendant. Plaintiff appeals.
Reversed.
Judgment of the District Court reversed and a new trial ordered.
John A Jorgenson, for appellant.
"Where a party seeks to avoid an instrument on the ground of an alteration, he must make out his case by clear and convincing testimony." Riley v. Riley, 9 N.D. 580, 84 N.W. 347; Rosenberg v. Jett, 72 F. 90; Brunton v. Ditto, 51 Colo. 178, 117 P. 156; Tanner v. Newton, 254 Ill. 432, 98 N.E. 929; Smith v. Parker (Tenn.) Ch. 49 S.W. 285, Dickenson v. Ramsey, 115 Va. 521, 79 S.E. 1025; Hecht v. Shenners, 126 Wis. 27, 105 N.W. 309; Maldaner v. Smith (Wis.) 78 N.W. 141.
"Blanks of any description left in writings not under seal may, except so far as prohibited by the Statute of Frauds, be filled in pursuance of mere parol authority." Yocum v. Barnes, 8 B. Mon. 496; Porter v. Hardy, 10 N.D. 551, 556, 88 N.W. 458; Violett v. Patton, 5 Cranch, 142, 3 L.Ed. 61; Shows v. Steimer, 175 Ala. 363, 57 So. 700; White v. Alward, 35 Ill.App. 195; Hut v. Adams, 6 Mass. 519; Roe v. Town Mut. F. Co., 78 Mo.App. 452; New England v. Brown, 59 Mo.App. 461; Ex parte Edcker, 6 Cow. 59; Bugger v. Cresswell (Pa.) 12 A. 829; Baldwin v. Haskell (Tex. Civ. App.) 124 S.W. 443; Re Tahit Co. L. R. 17 Eq. 273.
"Where one signs or indorses a bill or note containing blanks to be filled, the delivery of such an instrument is an authority to fill up the blanks in conformity with the original agreement." Cox v. Alexander, 30 Ore. 438, 46 P. 794; Stahl v. Berger, 10 Serg. & R. 170, 13 Am. Dec. 666, Lance v. Calvert, 21 Pa.Super. 102; Fitch v. Kelly, 44 U. C. Q. B. 578; Porter v. Hardy, 10 N.D. 551; South Berwick v. Huntress, 53 Me. 89, 87 Am. Dec. 535; Smith v. Crooker, 5 Mass. 538; New England v. Brown, 59 Mo.App. 461; Montgomery v. Dresher, 38 L.R.A.(N.S.) 423 and note; 90 Neb. 632, 134 N.W. 251.
"The filling of blanks is a question of authority, and not of alteration of a completed instrument." Bolter v. Koxlowski, 112 Ill.App. 13, affirmed in 211 Ill. 79, 71 N.E. 858; Wadron v. Young, 9 Heisk. 777; White v. Alward, 35 Ill.App. 195; Montgomery v. Dresher, 90 Neb. 632, 38 L.R.A.(N.S.) 423, 134 N.W. 251; Visher v. Webster, 8 Cal. 109; 7 Cow. 337; Story, P. N. § 110; Johnson v. Blasdale, 1 Smedes & M. 17, 40 Am. Dec. 85; Chitty, Bills, 33; Violett v. Patton, 5 Cranch, 151; Russell v. Langstaffe, 2 Dougl. 514; 2 Kent, 617; Storey, Agency, 158; Wintle v. Crowther, 1 Cromp. & J. Ex. 316; Fisher v. Dennis, 6 Cal. 577; Holmes v. Trumper, 22 Mich. 430.
The instrument here furnishes no evidence that would create even a suspicion of fraud or wrongdoing. The writing, the ink, and all such matters, are proper to consider. Maldaner v. Smith (Wis.) 78 N.W. 140; Messenger v. St. Paul R. Co., 77 Minn. 34, 79 N.W. 583.
A statute authorizing a new trial for insufficient evidence confers power to grant a new trial where the verdict is against the weight of the evidence. McDonald v. Walter, 40 N.Y. 551; Inland Elec. Co. v. Hall, 124 U.S. 121, 31 L.Ed. 1022, 8 S.Ct. 397.
Knauf & Knauf, for respondent.
When there are suspicious circumstances tending to discredit the instrument apparent upon its face, or from extrinsic facts, the burden of removing such suspicion is on the party seeking the use of the instrument. Jackson v. Osborn, 2 Wend. 555, 20 Am. Dec. 651; Clark v. Eckstein, 22 P. 507, 62 Am. Dec. 307.
Plaintiff having offered the altered note in evidence, it was incumbent on it to produce the evidence tending to show the alteration to have been made at a proper time or with the consent of the defendant. Greenl. Ev. 564; Smith v. United States, 69 U.S. 17 L.Ed. 788-791; Inglish v. Breneman, 41 Am. Dec. 96; Courcamp v. Weber, 39 Neb. 533; Bewcomb v. Presbrey, 8 Met. 406; United States v. Linn, 1 How. 111; Page v. Danaher, 43 Wis. 221.
There were no blank spaces in this note to be filled. There was a plain, clear alteration,--the numeral "10" having been written in Porter v. Hardy, 10 N.D. 551.
There is a vast difference between filling in blank spaces left in a delivered instrument, and changing or altering a completed instrument, such as was the one in the case at bar. Shows v. Steiner, 57 So. 700.
This is an action on a promissory note. The defense is a material alteration, and the answer alleges that "said sum was to bear no interest until after maturity, and that after the defendant had signed, executed, and delivered the said promissory note, the same was materially changed and altered by plaintiff, or its agent, to bear 10 per cent interest before maturity."
Judgment was rendered for the defendant and the plaintiff appeals. The errors which are assigned relate entirely to the instructions.
The portion of the note over which the controversy rages reads as follows:
"With interest payable annually at the rate of twelve per cent per annum to maturity."
The printed word "twelve" is crossed out and the "figure "10" written above.
The defendant claims that the "twelve" was crossed out when he signed and delivered the note, and that nothing was inserted in its place.
The note was made payable to the Merchants' National Bank of Wimbledon. It was sent to the Stutsman County Bank of Courtney for execution. The cashier of the bank at Courtney, who obtained this execution, did not testify. The cashier of the Merchants' National Bank of Wimbledom testified that the note was in its present condition at the time it was received by him from the Stutsman County Bank. There is no direct testimony as to who drew the note in the first instance, as to its original form, nor as to whose writing the written portions are in. There is, however, testimony to the effect that the note was given in payment for a team of horses which were bought from one Lilley in May, 1912, but was made, executed, and dated on December 24, and made payable to the Merchants' National Bank, which had a mortgage on the team.
Lilley also testified that the defendant had a conversation with him before the note was executed, and claimed he ought to have a reduction because one of the horses had become diseased, to which he, Lilley, replied that it was not his fault, "but before we will have any dispute about this team, you go to the bank and make out a note now, and it will not have interest for last summer."
This conversation is testified to by Lilley as having been had in the fall, the horse having been sold in the spring. The defendant testifies that he did have a conversation shortly before the execution of the note, but nothing was said at all about the interest. The note was executed on the 24th day of December, 1912, and interest is merely claimed from that date. The defendant further testifies that at the time the note was executed the twelve was stricken out, and that the ten was not written over it; also, that he saw it twice after that time and that the ten was not there early in the spring of 1913.
It is first maintained that the court should have instructed the jury that, by delivering the note to the plaintiff bank with the twelve crossed out, the defendant impliedly consented to the insertion of the figure "10."
It may be laid down generally that "if one signs an instrument containing blanks, he must be understood to intrust it to the person to whom it is so delivered to be filled up properly according to the agreement between the parties, and when so filled the instrument is as good as if originally executed in complete form." Porter v. Hardy, 10 N.D. 551, 556, 88 N.W. 458; Re Tahite Co. L. R. 17 Eq. 273, 43 L. J. Ch. N. S. 425, 22 Week. Rep. 815.
It is also true that "blanks of any description, left in writings not under seal, may, except so far as prohibited by the Statute of Frauds, be filled in pursuance of mere parol authority." Yocum v. Barnes, 47 Ky. 496, 8 B. Mon. 496.
There is, however, in the record which is before us and outside of the note itself, no proof whatever of any agreement for the payment of 10 per cent interest, and though 10 per cent could, at the time of the execution of the note, have been contracted for, the legal rate, in the absence of such an agreement, was 7 per cent. Comp. Laws 1913, § 6072. There may therefore have been implied authority to insert the figure "7," but there was no implied authority to insert that of "10." Porter v. Hardy, supra; 2 Enc. L. P. 177; 2 Cyc. 164; Hoopes v. Collingwood, 10 Colo. 107, 3 Am. St. Rep. 565, 13 P. 909; Palmer v. Poor, 121 Ind. 135, 6 L.R.A. 469, 22 N.E. 984; Holmes v. Trumper, 22 Mich. 427, 7 Am. Rep. 661.
It is next urged that the trial court failed to instruct the jury, at the request of the plaintiff, that "where a party seeks to avoid an instrument on the ground of an alteration he must make out his case by clear and convincing testimony sufficient to convince the mind of a reasonably prudent and cautious person, especially where the change will amount to a crime;" and that "the presumption of innocence and fair dealing among men is so persuasive that a situation which violates it calls for evidence of a more clear and satisfactory character than one that does not involve moral turpitude or the commission of a crime or offense."
We are of the opinion that the court erred in not giving these instructions. If the 10 was written in without authority either a forgery was committed or there was a breach of...
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