Appeal
from Superior Court of Baltimore City; Henry Stockbridge
Judge.
Action
by Joseph C. Stouffer against Albert G. Alford. From a
judgment for defendant, plaintiff appeals. Affirmed.
Where
in an action by an indorsee of a draft given by the acceptor
for goods sold, the acceptor showed that he was induced by
fraud to accept the draft, a charge that the failure of the
seller to fulfil its promises in the contract of sale, or any
of the promises in the contract of sale, or any of the
promises made by its salesman, did not constitute fraud in
the procuring of the draft was properly refused, because
segregating that fact from the other facts to which it bore a
close relation.
The following prayers of plaintiff were refused:
"(2)
The plaintiff prays the court to instruct the jury that
there is no evidence in this case to impeach the bona fides
of the plaintiff's holding, and that there is no legal
evidence of fraud in the obtaining of the drafts offered in
evidence, sufficient to cast upon the plaintiff the burden
of proving the bona fides of said holding, and therefore
the verdict of the jury must be for the plaintiff for the
full amount of the four drafts offered in evidence,
together with such interest, if any, as the jury finds due
and payable to plaintiff.
"(3)
The plaintiff prays the court to instruct the jury that the
defendant has failed to show in this case any facts that
would constitute a defense in this action, even had it been
between the original parties to the drafts offered in
evidence, and therefore the verdict of the jury must be for
the plaintiff.
"(4)
If the jury shall find from the evidence that the defendant
is a business man and was able to read and write, and that
he signed the contract with the Lyon-Taylor Company
testified to in this case, and that he subsequently, a week
or more later, accepted or signed the drafts in accordance
with the said contract, then the said defendant is thereby
presumed to have known and agreed to the terms of the said
contract, and that he cannot now claim that he was induced
to sign or accept the drafts because of any false
representations as to its terms and conditions, if the jury
shall find that such false representations were made.
"(5)
The plaintiff prays the court to instruct the jury that if
the jury shall find that, by the defendant's own
evidence, he was able to read and write and signed the
contract or order for the goods, and a week or more later,
about October 26, 1904, he received the goods, put them on
sale, and actually sold some of them, and kept the said
goods on sale until after Christmas, during all of which
time he had a copy of the contract in his possession then
the said defendant cannot evade liability on the said
drafts accepted by him in accordance with the contract,
because of any fraudulent representations as to the terms
of the said contract, even though the jury shall find that
such representations have been made, and the jury is
instructed that the said defendant by his said course of
conduct has waived any rights he might have to make that
contention, and that he has ratified his action in
accepting the said drafts and is bound thereby.
"(6)
The plaintiff prays the court to instruct the jury that the
defendant (even if he was induced to enter into the
contract with the Lyon-Taylor Company and to accept the
drafts offered in evidence, by reason of false statements
and representations made by the salesman of that company)
was bound, upon discovering the said statements and
representations to be false, to promptly rescind his
contract, and that the testimony in this case does not show
that he did act promptly in rescinding the same, and
therefore the verdict of the jury must be for the
plaintiff.
"(7)
The plaintiff prays the court to instruct the jury that
even if the jury shall find that the Lyon-Taylor Company
failed to fulfill any of its promises or agreements
contained in the contract or any of the promises made by
its salesman, that these facts would not constitute fraud
in the procuring of the drafts offered in evidence."
"(9)
The plaintiff prays the court to instruct the jury that
there is no legally sufficient evidence in this case that
the Lyon-Taylor Company ever failed or refused in any
particular to fulfill the contract made with said defendant
and offered in evidence."
The
court granted, as modified, the following prayers of
defendant:
"(2)
The jury are instructed that in determining whether or not
the defendant's signature to the instruments sued on
was procured by fraud, they are to consider all the
circumstances surrounding the signing of same by defendant
as detailed in evidence, and all the other evidence in the
case, and if the jury find that the agent of the
Lyon-Taylor Company represented to defendant at the time of
the sale of the goods to defendant that the Lyon-Taylor
Company was the manufacturer of said goods, that the goods
are of fine quality and guaranteed to wear from 5 to 20
years, that no goods would be sold in West Baltimore and
only to one dealer in East Baltimore, and if the jury
further find that the goods were of inferior quality and
practically worthless, that other goods were sold by the
Lyon-Taylor Company to other merchants in West Baltimore,
then the jury must infer from these facts and other
evidence in the case that defendant's signature to the
bills of exchange sued on was procured by fraud, and if
they so find, their verdict should be for the
defendant."
"(5) If the jury believe that certain merchandise was
sold to the defendant by the Lyon-Taylor Company upon the
representation made by its agent, among others, that no other
merchandise would be sold by it within certain bounds of
defendant's business, that the defendant was induced by
said representations to sign the said bills of exchange sued
on, that but for said representations he would not have
signed them, and that merchandise was sold by the company to
others within said bounds, then the jury may infer that the
signatures of the defendant were procured by fraud, and if
the jury so find the signatures were procured by fraud, their
verdict should be for the defendant."
"(7)
If the jury believe from the evidence that the defendant was
induced to sign the bills of exchange sued on by a
misrepresentation, among others, of the agent of the
Lyon-Taylor Company as to the kind or quality of the
merchandise sold by said company to defendant, then the jury
may infer that the signatures of the defendant were procured
by fraud, and if the jury so find that the signatures of the
defendant were procured by fraud, their verdict should be for
the defendant.
The
court granted the following prayer of defendant:
"(9)
The jury are instructed that gross inadequacy of
consideration is one of the badges of fraud, and they may
consider the evidence of the value of the jewelry, and the
price at which it was sold to defendant, in connection with
other representations, if any, of the agent of the
Lyon-Taylor Company to defendant in arriving at a conclusion
as to whether or not defendant's signature to the bills
of exchange sued on was secured under such circumstances as
to amount to fraud."
Argued
before BOYD, C.J., and BRISCOE, PEARCE, SCHMUCKER, BURKE,
THOMAS, PATTISON, and URNER, JJ.
SCHMUCKER
J.
The
appellant, claiming to be the lawful holder of four overdue
negotiable drafts which had been accepted by the appellee,
sued him thereon in the superior court of Baltimore city.
The
declaration alleged that the drafts had been drawn upon the
appellee by Milbert T. Price and Louis E. Lyon, trading as
Lyon-Taylor Company, and, after their acceptance by him, had
been indorsed by Lyon-Taylor Company to the appellant for
value, before maturity, and without notice of any defect
therein. The appellee, as defendant, pleaded the general
issue pleas and a special plea as an equitable defense,
averring that his acceptance of the drafts had been procured
without consideration and by fraud, misrepresentation, and
deceit. The plaintiff demurred to the special plea, but his
demurrer was overruled by the court, whereupon he joined
issue on all of the pleas. At the trial of the case, the
plaintiff offered the drafts in evidence and then, upon the
admission by the defendant of his signature to the
acceptances, rested his case. The defendant offered evidence
tending to prove that his acceptance had been fraudulently
procured. This evidence was admitted, over the
plaintiff's objection, subject to exception, and at the
close of the defendant's case the plaintiff moved to
strike it out, but the court overruled the motion. The
plaintiff then, without and proof of the circumstances under
which he obtained the acceptances or of his bona fides in
that connection, or his want of notice of any facts or
circumstances impeaching their validity, contented himself
with offering evidence tending to contradict the testimony of
the plaintiff's witnesses, that much of the jewelry for
which the drafts had been drawn had been charged to the
defendant at grossly excessive prices. The verdict and
judgment below having been for the defendant, the plaintiff
took the present appeal.
We will
dispose, first, of the issue raised by the demurrer to the
special plea setting up fraud in procuring the
defendant's acceptance of the draft. That plea was
defective in failing to charge the plaintiff with knowledge
or notice of the alleged fraud. Banks v. McCosker,
82 Md. 521, 34 A. 539, 51 Am. St. Rep. 478; Black v. Bank
of Westminster, 96 Md. 415, 416, 54 A. 88. It was bad
for the further...
