Reddick v. Jones
| Decision Date | 31 December 1845 |
| Citation | 6 Ired. 107,44 Am.Dec. 68,28 N.C. 107 |
| Court | North Carolina Supreme Court |
| Parties | ABRAM REDDICK v. DANIEL JONES et al. |
Taking negotiable paper in payment of a precedent debt, constitutes a purchase of it for value; and the bona fide endorsee will hold it, unaffected by any equities, if he take it without notice of any facts, which implicate its validity, as between the prior parties.
Where a note was executed in this State, not payable at any particular place, and was afterwards endorsed in the State of Virginia-- Held, that whatever might be the law in Virginia, the endorsee could maintain his action in this State, against both the drawer and endorser.
The case of Black v. Bird, 1 Hay. 273, cited and approved.
Appeal from the Superior Court of Law of Camden County, at the Spring Term, 1845, his Honor Judge BATTLE presiding.
This is an action of debt, brought under the statute, by the plaintiff, as endorsee of a sealed note, bearing date October 19th, 1841, for $300, payable six months after date; which was given in this State by Daniel Jones, to the defendant, Taylor, and by Taylor endorsed to James Owens, and then by Owens endorsed in Virginia to the plaintiff, before the note became due, in payment of a debt which Owens owed the plaintiff.
On nil debet pleaded, the case was this: The obligor, Jones, was indebted to Owens in the sum of $300, and executed the note therefor, but made it payable to Taylor, in order to get his endorsement as additional security. Jones and Owens requested Taylor to endorse the note, but he refused; and then Owens told him that his endorsement would not make him liable for the money mentioned in the note, but he wished it in order to enable him, Owens, to pass it off; and thereupon, Taylor, being an unlettered man, did endorse the note to Owens, who then carried it to Virginia, and endorsed it to the plaintiff.
The counsel for the defendant thereupon insisted, that as his endorsement had been fraudulently obtained without consideration, the plaintiff could not recover, though he took the note bona fide from Owens, because the plaintiff was not a purchaser for a valuable consideration, but took the note in payment of a pre-existing debt from Owens to him.
The counsel further insisted, that the plaintiff could not recover, because the endorsement was made to him in Virginia, and he had not shewn that the note was negotiable and would pass by endorsement by the laws of that State.
The Court refused to give the instructions, and directed the jury that the plaintiff was entitled to their verdict. The jury found for the plaintiff, and from the judgment, the defendant appealed.
A. Moore, for the plaintiff .
No counsel for the defendant.
As it would be impossible for a purchaser to ascertain all the latent defects or equities, that might be set up against a bill or note, it was early found indispensable to the credit of negotiable instruments to hold, that a person, who takes them bona fide for a valuable consideration, before they are due, and without notice of their infirmity, is not affected by the failure or the want of a consideration, or even a fraud between previous parties, but may recover the money due thereon. This has been long held in this State, Black v. Bird, 1 Hay. 273; and it is needless to cite other authorities, as every treatise on Bills and Notes thus lays down the doctrine. The only exceptions are founded upon the positive enactments of statutes, which forbid the making of certain contracts, and declare the securities void: as, for example, gaming and usurious contracts. Those the law must of necessity hold void in the hands of the most innocent; otherwise, the statutes would always...
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