Montgomery v. Dresher

• Decision Date: 24 January 1912
• Docket Number: 16,575
• Citation: 134 N.W. 251,90 Neb. 632
• Parties: SIDNEY S. MONTGOMERY, APPELLANT, v. QUINTILLA M. DRESHER, APPELLEE
• Court: Nebraska Supreme Court

134 N.W. 251

90 Neb. 632

SIDNEY S. MONTGOMERY, APPELLANT, v. QUINTILLA M. DRESHER, APPELLEE

No. 16,575

Supreme Court of Nebraska

January 24, 1912

APPEAL from the district court for Douglas county: LEE S. ESTELLE JUDGE. Reversed with directions.

REVERSED.

William Baird & Sons, for appellant.

Duncan M. Vinsonhaler, contra.

OPINION

REESE, C. J.

This is an action to foreclose a mortgage on lot 17, in block 2, in Hanscom Place, an addition to the city of Omaha. The petition is in the usual form, and is based upon two promissory notes, each bearing date December 31 1907--one for $ 500, due January 1, 1909, the other for $ 1,200, due January 1, 1910--secured by the mortgage set out in the petition, all issued to one Becker and indorsed and assigned to plaintiff. The answer consists of (1) a general denial of all unadmitted facts alleged in the petition; and (2) alleges the perpetration of a fraud upon defendant by Becker in the exchange of properties by fraudulently misrepresenting the quality, character and value of the property involved in this action, and for the price of which the notes described in the petition were in part given; that the notes and mortgage when executed did not contain the name of Anson E. Becker, as payee and grantee, and that they have been changed and altered after delivery by the insertion of Becker's name therein where they were left blank at the time of execution and delivery; that defendant would not have signed the same had his (Becker's) name been there. The averment in the petition that plaintiff is a bona fide owner and holder of said notes and mortgage is also denied; and it is alleged that he had full knowledge of their defects when executed, that they were without consideration, that he is not the owner thereof, and his pretended purchase of them was the carrying out of a fraudulent conspiracy, entered into with the said Becker, to aid in the perpetration of a further fraud upon her. There are other averments in the answer which it is not deemed necessary to notice here. By the reply plaintiff denied any knowledge of the exchange of property as alleged in the answer, or of any fraud therein, or that the name of the payee and mortgagee had been inserted after delivery; averred that the filling of the blanks therein by the insertion of Becker's name was by the authority of defendant, that plaintiff was a bona fide holder and owner thereof by their purchase for value before the maturity of the notes. Other averments of this reply need not be here noticed. There was a trial to the district court, which resulted in a finding and decree in favor of defendant, dismissing plaintiff's petition, canceling the mortgage, and quieting defendant's title. The findings of the decree are to the effect that plaintiff did not acquire the notes and mortgage for a valuable consideration in the due course of business, that there had been a material alteration in the mortgage subsequent to its execution and delivery, and that the mortgage casts a cloud on defendant's title which she is entitled to have removed and her title quieted. A decree was accordingly rendered. The decree provides that it is without prejudice to plaintiff's right of action on the notes, but no judgment is rendered thereon. Plaintiff appeals.

From an examination of the evidence contained in the bill of exceptions, we conclude there are but three controlling questions involved in this case. (1) Was the insertion of the name of Becker as payee of the notes and grantee in the mortgage a material alteration of said instruments? (2) If so, were the blanks so filled by the authority and consent of defendant? (3) Is plaintiff a bona fide holder of said instruments?

Since the use of private seals has been abolished in this state (Ann. St. 1911, sec. 11851) all contracts are upon the same footing as simple contracts. Therefore, the same rule should be applied to all. The filling in of a blank in a written instrument is not, strictly speaking, an alteration of the instrument. Where a blank is filled in, it is a question of authority so to do. Waldron v. Young, 56 Tenn. 777. The right to fill in blanks in written instruments is based upon an assumption of consent. The leaving of a blank space is considered to imply authority to fill it. Inhabitants of South Berwick v. Huntress, 53 Me. 89; Smith v. Crooker, 5 Mass. 538; New England Loan & Trust Co. v. Brown, 59 Mo.App. 461; Porter v Hardy, 10 N.D. 551, 88 N.W. 458. In New England Loan & Trust Co. v. Brown, supra, it is said, quoting from Mackey v. Basil, 50 Mo.App. 190: "The rule of law is now everywhere well settled that the leaving of blanks in a contract, and the delivery of the instrument with such blanks, creates an agency in the receiver to fill the blanks in the way contemplated by the maker. The authority to fill in the blanks will be implied"--citing a number of cases and authorities. See, also, Augustine v. Schmitz, 145 Iowa 591, 124 N.W. 607; Chapman v. Veach, 32 Kan. 167, 4 P. 100; Field v. Stagg, 52 Mo. 534; Pence v. Arbuckle, 22 Minn. 417; Van Etta v. Evenson, 28 Wis. 33; 2 Reeves, Real Property, sec. 1085 et seq.; ...