Parker v. Stallings

• Decision Date: 31 January 1868
• Citation: 61 N.C. 590,98 Am.Dec. 84
• Court: North Carolina Supreme Court
• Parties: DAVID PARKER v. HENRY E. STALLINGS and others.

61 N.C. 590

98 Am.Dec. 84

DAVID PARKER

v.HENRY E. STALLINGS and others.

Supreme Court of North Carolina.

January Term, 1868.

*1 A note payable at, or one day after date, is not within the principle which excepts from the rule as to bona fide endorsees for value such as take notes that are overdue.

A bona fide endorsee for value of a note so payable obtains a good title against all previous parties, although when endorsed it was overdue, and had been obtained by a fraud upon some of those parties, committed by one through whom the endorsee claims title.

( Haywood v. McNair, 2 Dev. & Bat., 283; cited and approved.)

DEBT, tried before Barnes J., at Fall Term 1867 of the Superior Court of PERQUIMANS.

The paper sued upon was as follows:

One day after date, with interest from date, we or either of us do promise to pay Henry E. Stallings or order the just and full sum of two hundred and eleven dollars and thirty cents, for value received. As witness our hands and seals.

+------------------------------------+
                ¦(Signed)¦JAMES M. STALLINGS, [seal.]¦
                +--------+---------------------------¦
                ¦(Signed)¦ASA R. STALLINGS, [seal.]  ¦
                +------------------------------------+
                

Endorsed: “Pay to J. P. Jordan.” (Signed) Henry E. Stallings [s.]; also, “Pay to D. Parker or order.” (Signed) J. P. Jordan [s.]

The suit was brought against all the parties to the paper.

It was shown that Henry E Stallings had carried the note to Jordan, an attorney, in order to have it collected, and had endorsed it in blank upon being told by Jordan that it was necessary for him to put his name on the back of it to enable the latter to collect it by suit. Jordan afterwards sold the note to the plaintiff, first filling up to himself the endorsement of Stallings, and endorsing the bond himself in blank. This latter endorsement was filled up at the trial. There was no evidence that the plaintiff knew anything of the circumstances under which Stallings had placed his name upon the bond.

The plaintiff objected to the admission of testimony as to what passed at the time when Stallings endorsed the bond; but it was admitted by the court.

His Honor charged the jury that if the evidence satisfied them that Stallings placed his name upon the bond under an impression that it was necessary to enable him to institute suit, and not for the purpose of endorsing it and transferring the title, that was not such an endorsement as rendered him liable.

Verdict accordingly; Rule for New Trial discharged; Judgment, and appeal by the plaintiff.

Smith, for the appellant .

*2 1. The case shows an endorsement in fact and a delivery to Jordan, and parol evidence is incompetent to vary or diminish the legal obligations of the contract of endorsement; ex gr., as here to show that a general endorser was in fact an endorser without recourse, to the prejudice of a subsequent endorsee without notice and for value. Marston v. Allen, 8 M. & W., 504.

2. The rules applicable to over due and dishonored paper, do not apply to an endorsement made after the paper was due, where enquiry would have developed no facts prejudicial to the claim.

3. Every endorsement is presumed in law to have been made before the debt falls due. Byles on Bills (61 L. L., 152.)

W. A. Moore, contra .

BATTLE J.

The question presented by the pleadings and bill of exceptions is one of much practical importance, though of no great difficulty. The principle upon which the decision must turn is clearly stated by the Court of Exchequer in the case of Marston v. Allen, 8 M. & W. 494. It is there said that “the law merchant, for the purpose of currency and the advantages flowing from an unchecked circulation of bills of exchange, no doubt provides that a bona fide holder for value shall not be affected by an intermediate fraud. We do not indeed adopt the proposition that the previous party to the bill is estopped from setting up the defence of fraud against the claim of a bona fide holder for value. We think it better to say that, by the law merchant, every person...