Siegel v. Chicago Trust & Sav. Bank

• Decision Date: 21 January 1890
• Citation: 131 Ill. 569,23 N.E. 417
• Court: Illinois Supreme Court
• Parties: SIEGEL et al. v. CHICAGO TRUST & SAV. BANK.

131 Ill. 569

23 N.E. 417

SIEGEL et al.

v.CHICAGO TRUST & SAV. BANK.¹

Supreme Court of Illinois.

Jan. 21, 1890.

Appeal from appellate court, first district.

Assumpsit by the Chicago Trust & Savings Bank against Siegel, Cooper & Co. Judgment for plaintiff affirmed by the appellate court. Defendants appeal. The instruction referred to in the opinion was as follows: ‘In answer to your question as to the meaning of the words ‘good faith,’ used in the instructions heretofore given, the court instructs you that they mean the opposite of ‘bad faith;’ that ‘good faith’ means ‘honesty,’ and ‘bad faith’ means ‘dishonesty.”

John C. Richberg, for appellants.

Flower, Smith & Musgrave, for appellee.

SHOPE, C. J.

This was an action of assumpsit, by appellee against appellants, upon the following instrument: ‘Form B. Dalziel's Railway Advertising. $300.00. Chicago, March 5, 1887. On July 1st, 1887, we promise to pay D. Dalziel, or order, the sum of three hundred dollars, for the privilege of one framed advertising sign, size ___ x ___, in one end of each of 159 street-cars of the North Chicago City Railway Co., for a term of three months from May 15, 1887. No. ___. SIEGEL, COOPER & Co.,’-which was indorsed by Dalziel, the payee, to appellants, for value, on the day of its execution.

The first question presented is, is this instrument negotiable? And this question has been answered affirmatively by the circuit and appellate courts. The appellate court having affirmed the judgment in favor of the plaintiff, the case is brought here by appeal, upon certificate of importance, granted by that court. It appears that, before the time when the privilege of advertising was to commence, Dalziel forfeited any right he may have acquired to use the cars in the manner indicated, and the privilege specified never was furnished appellant; and it is insisted that the instrument is a simple contract only, and that therefore, the same defense, failure of consideration, is available against the indorsees of the paper for value and before due, as might be interposed against such paper in the hands of the payee. It is also insisted that the instrument shows on its face that payment depended upon a condition precedent to be performed by the payee, and therefore the indorsees took it with notice, and, by the failure of the payee to perform the condition, no right of recovery exists in the indorsees.

It is not contended that the indorsees had any other notice than that contained in the instrument itself; and it is apparent that at the time of its indorsement, which was the day of its execution, no right to the consideration had accrued to the maker. It is a promise to pay a certain sum of money at a day certain, for a consideration thereafter to be rendered, and depends for its validity upon the implied promise of the payee to furnish the consideration at the time and in the manner stipulated. That is, it is a promise to pay a sum certain on a particular day, in consideration of the promise of the payee to do and perform on his part. A promise is a valuable consideration for a promise.

But the question remains whether the statement, or the recital of the consideration, on the face of the instrument, impairs its negotiability, and in this instance amounted to a condition precedent. The mere fact that the consideration for which a note is given is recited in it, although it may appear thereby that it was given for or in consideration of an executory contract or promise on the part of the payee, will not destroy its negotiability, unless it appears through the recital that it qualifies the promise to pay, and renders it conditional or uncertain, either as to the time of payment of the sum to be paid. Daniel, Neg. Inst. §§ 790, 797; Davis v. McCready, 17 N. Y. 230;Bank v. Cason, 39 La. Ann. 865, 2 South. Rep. 881;Bank v. Michael, 1 S. E. Rep. 855;Goodloe v. Taylor, 3 Hawks, 458;Stevens v. Blunt, 7 Mass. 240. In Bank v. Cason, supra, it is said: ‘Plaintiff received the note before maturity, and before a failure of the consideration. Even if it were known to him taking it that the consideration was future and contingent, and that there might be offsets against it, this would not make him liable to the equities between defendants and payee. It cannot affect the negotiability of a note that its consideration is to be hereafter realized, or that from some contingency it may never be enjoyed.’ The most that can be said of a recital in the instrument itself of the consideration upon which it rests is that the indorsee, taking...