Seymour v. Malcolm McDonald Lumber Co.

• Decision Date: 02 October 1893
• Docket Number: 79.
• Citation: 58 F. 957
• Parties: SEYMOUR v. MALCOLM McDONALD LUMBER CO.
• Court: U.S. Court of Appeals — Sixth Circuit

58 F. 957

SEYMOUR v. MALCOLM McDONALD LUMBER CO.

No. 79.

United States Court of Appeals, Sixth Circuit.

October 2, 1893

Statement by SWAN, District Judge:

This is an action of assumpsit brought upon defendant's acceptance of the following instrument, viz.:

'$3,250.

Manistee Michigan, August 21, 1889.

'At sight pay to the order of myself thirty-two hundred and fifty dollars, value received, and charge same to account of

[Signed]

'H A. Tiffany.

'To R. A. Seymour, Manistee, Mich.'

Defendant's acceptance on the face of the draft is in these words:

'Accepted. Payable out of the proceeds of the J. E. Potts notes when discounted by me.

R. A. Seymour.'

The draft has the following indorsements:

'Pay to the order of C. B. Osborne.

[Signed]

'H. A. Tiffany.'

Again:

'Pay to the order of the Malcolm McDonald Lumber Company without recourse at any time on me.

C. B. Osborne.'

The execution of the draft, the indorsements, and the acceptance were proved. Defendant pleaded the general issue, to which was appended, under the Michigan practice, a notice of special matter which would be insisted upon in defense. The matters offered to be shown under this plea and notice were that plaintiff was not a bona fide holder for value and without notice of defendant's rights and equities of the draft and acceptance sued upon; that, at the commencement of this suit, defendant was not indebted to Tiffany, the drawer, or to the plaintiff, upon any proceeds of said Potts' notes, or upon any other matter, but, on the contrary, Tiffany owed defendant a large amount of money upon this and other unsettled matters of account; and that there is pending and undetermined in the circuit court of the United States for the western district of Michigan a suit in equity commenced December 3, 1891, wherein the identical subject-matter of this action is in controversy, in which both the parties to this cause are defendants; and that a determination of the issue in said suit in equity will decide the whole issue in the present action at law.

The facts which culminated in the execution of this draft and acceptance, and consideration for the same, condensed from the record, are that the defendant and H. A. Tiffany, Frederick Seymour, and N. R. Smith were copartners in the ownership of certain land and other property. They sold the lands to one Potts for $55,000, receiving $18,333 in cash, and, for the remainder of the purchase money, Potts' four promissory notes for $9,166.66 each. Tiffany's interest in the copartnership was three-eighths. On June 26, 1889, Tiffany, for the expressed consideration of $7,000, sold and assigned to James Frazer all his (Tiffany's) right, title, and interest in the said Potts' notes and the collaterals, and this was known to defendant when he accepted the draft in suit. Tiffany had also previously assigned a part interest in said notes and collaterals to one Cartier. In August, 1889, Tiffany went to Manistee, Mich., as the agent of Frazer, and presented for defendant's acceptance a draft drawn by Frazer on defendant for $3,250, which was indorsed by Frazer generally, and which Seymour, the defendant, 'accepted, payable out of the proceeds of the Potts notes when discounted by me.' For ulterior purposes of his own, Tiffany, after the receipt of this acceptance from Seymour, telegraphed Frazer, his principal, that Seymour had refused to accept the draft, and instructed him to 'reassign my assignment to you to R. A. Seymour. Manistee, and send to him by first mail. Wire Seymour when you have mailed it.' Upon receipt of this dispatch, Frazer sent defendant a telegram in these words: 'R. A. Seymour. Have mailed reassignment Tiffany's interest in Potts' papers to you. J. Frazer,'--and Tiffany then applied to defendant to change the acceptance accordingly. Seymour, on the faith of Frazer's telegram, thereupon destroyed the first draft and acceptance, and executed the acceptance in suit in favor of Tiffany for the same amount, $3,250. Frazer, however, failed to mail the reassignment, nor was it ever delivered either to Seymour or Tiffany. Tiffany went to Milwaukee next day, and was there met by Frazer, who demanded the draft, but Tiffany refused to surrender it. Tiffany testified that defendant delivered to him the draft and acceptance in consideration of Frazer's reassignment of the interest in the Potts' notes, and his (Tiffany's) interest in several other deals. Seymour, on the contrary, says that the only consideration was the reassignment to him of Tiffany's interest in the Potts notes held by Frazer, and this was merely nominal. The draft was indorsed by Tiffany to Osborne, his brother-in-law, and by the latter, at Tiffany's instance, indorsed and delivered to plaintiff, who credited it at its face value upon Tiffany's indebtedness to plaintiff, to whom he was then owing $5,400. There is no evidence that plaintiff had notice of the circumstances under which the acceptance was given, the consideration therefor, or of any other infirmity in Tiffany's or Frazer's title thereto. At the conclusion of the testimony, the court directed a verdict for the plaintiff.

McAlvay & Grant, for plaintiff in error.

Niram A. Fletcher and George P. Wanty, for defendant in error.

Before TAFT and LURTON, Circuit Judges, and SWAN, District Judge.

SWAN District Judge, (after stating the facts.)

Although the court below directed a verdict for the plaintiff on the ground that no defense cognizable at law had been shown to the acceptance, the defendant is still at liberty to show either that there was sufficient evidence to go to the jury, or that questions of law apparent upon the record would control the case in opposition to the direction. It is claimed here not only that the evidence adduced by the defendant and received by the court required the submission of the cause to the jury, but also that the court excluded competent and material evidence which might fairly have changed the result. This contention makes it necessary for us to pass upon the sufficiency of the evidence admitted below, and the admissibility of that tendered and excluded.

1. A preliminary question arises upon the ruling of the court made upon the cross-examination of defendant, who was examined as a witness for the plaintiff. Upon his direct examination he had testified substantially that he signed the acceptance and that the Potts notes, from the proceeds of which it was payable, were paid to him before this suit was commenced. This was the extent of his examination in chief. Upon cross-examination, defendant's counsel then sought to show by the witness that Tiffany obtained the acceptance from Seymour by misrepresentation and fraud; that Tiffany came to Manistee, and saw Seymour as the agent of Frazer, and in Frazer's interest procured defendant's acceptance of the first draft, which was destroyed upon the delivery to Tiffany of the draft and acceptance in suit. The court excluded the evidence as not proper cross-examination. There was no error in this ruling. The rule has long been settled that the cross-examination of a witness must be limited to the matters stated in his direct examination. If the adverse party desires to examine him as to other matters, he must do so by calling the witness to the stand in the subsequent progress of the case. Houghton v. Jones, 1 Wall. 706; Railroad Co. v. Stimpson, 14 Pet. 461; Wills v. Russell, 100 U.S. 621, 625. In the case last cited it was further held that a judgment will not be reversed merely because it appears that the rule limiting the cross-examination to the matters opened by the...