Wedding v. First Nat. Bank, Inc., of Chicago

• Decision Date: 24 November 1939
• Citation: Wedding v. First Nat. Bank, Inc., of Chicago, 280 Ky. 610, 133 S.W. 2d 931 (Ky. Ct. App. 1939)
• Parties: WEDDING v. FIRST NAT. BANK, INC., OF CHICAGO.
• Court: Kentucky Court of Appeals

133 S.W.2d 931

280 Ky. 610

WEDDING v. FIRST NAT. BANK, INC., OF CHICAGO.

Court of Appeals of Kentucky

November 24, 1939

Appeal from Circuit Court, Jefferson County, Common Pleas Branch Second Division; B. H. Farnsley, Judge.

Action by the First National Bank, Incorporated, of Chicago, against C. C. Wedding to enforce a judgment rendered by a municipal court in Illinois against defendant in an action on a cognovit note. From a judgment for plaintiff, defendant appeals.

Affirmed.

John P Haswell and James E. Fahey, both of Louisville, for appellant.

Bruce &amp Bullitt, of Louisville, for appellee.

SIMS Commissioner.

A cognovit note for $2,576.65 was executed to the Forman-State National Bank on December 22, 1933, by the Jiffey Manufacturing Company through C. C. Wedding, president, and J. R. Finklestein, H. W. Brown and C. C. Wedding, signed the note as sureties. This note was due March 22, 1934, or at any time of the payee "feels unsafe or unsecure for any reason whatsoever," and it was a renewal of the unpaid balance of a $5,000 note the makers had executed to the bank in 1930.

The note is quite long, covering almost four single spaced typewritten pages, hence we will not quote it in full but will give the substance of the parts relating to this transaction. It contained a power of attorney, usually referred to in such notes as a warrant of attorney authorizing any attorney of any court of record to appear in such court in term time or vacation and confess judgment, without process, against the makers, guarantors and indorsers in favor of the legal holder of the note for the balance due, including costs and reasonable attorney fees; it further provided a waiver and release of all errors in such proceeding and that no appeal would be prosecuted and that immediate execution might issue upon such judgment.

Wedding maintained an office in Louisville, but resided at Goshen, Oldham County, Kentucky, and the note was signed in Goshen and forwarded to Brown in Chicago, to be delivered to the payee, which Brown did. The payee, Forman-State National Bank, at the time it received this note, was being liquidated by the First National Bank of Chicago, and the Forman-State National Bank acting by James R. Galligan, assistant cashier, soon after receiving the note indorsed it to the order of the First National Bank. On March 7, 1935, which was long after the maturity of the note, the First National Bank instituted action thereon against the makers in the municipal court of Chicago, a court of general jurisdiction; and E. A. Wagner, a duly licensed attorney of that court, filed a cognovit wherein he confessed judgment against the makers of the note for the face of the note, interest, court costs and $211.23 attorney's fee, without any notice or process being served upon the makers. The record shows that such procedure is authorized under the law of the State of Illinois.

This action was instituted in the Jefferson Circuit Court on a copy of that judgment duly authenticated according to the Act of Congress to enforce same against the appellant, Wedding. He filed a general demurrer to the petition and after that was overruled he filed an answer which as amended questioned the title of the appellee to this note and averred that the Illinois court never had jurisdiction over him; that the judgment was obtained without due process of law by a legal fraud; that he was denied equal protection of the law which is guaranteed him by the Fifth and Fourteenth Amendments of the United States Constitution, U.S.C.A.; that the cognovit was obtained by fraud and misrepresentation. The issues were joined by appropriate pleadings, and upon a trial of the case the court peremptorily instructed the jury to find for the plaintiff as Wedding introduced no proof that the note was procured by fraud or misrepresentation, or that the Illinois court did not have jurisdiction, or that it rendered the judgment without due process of law. A judgment was entered upon the verdict for the full amount sued for after the bank had remitted the $211.23 attorney's fee recovered in the Illinois judgment, and Wedding prosecutes this appeal assigning the following errors: (1) The petition is defective in alleging the First National Bank existed by virtue of the laws of the State of Illinois; (2) this note is not a negotiable instrument and the First National Bank never took title to it and was not entitled to judgment in Illinois; (3) the contract is to be governed by the law of the State of Kentucky and is not enforceable under Kentucky Statutes, Section 416; (4) even though the contract should be governed by the Illinois law, it contravenes public policy of the State of Kentucky as promulgated under Kentucky Statutes, Section 416 and the Illinois judgment will not be enforced in this state.

Any defect there might be the petition because it averred the First National Bank was organized under the State of Illinois was waived by the appellee. The general demurrer he filed to the petition did not reach this alleged defect which could only be attacked by special demurrer or by a pleading under section 118 of the Civil Code of Practice, and appellant filed no special demurrer, nor any plea under section 118. A misnomer in the plaintiff's name may be reached by a plea in abatement, but a plea in bar will not lie against such misnomer. Stange v. Price, 191 Ky. 734, 231 S.W. 532; Morgan's Trustee v. Morgan, 237 Ky. 69, 34 S.W.2d 945. The word "national" may not be used as a part of the name of any bank unless it be chartered under the laws of the United States. U.S.R.S. § 5243, 12 U.S.C.A. § 583; and courts take judicial notice of this fact. First National Bank of Jacksonville v. First State Bank of Jacksonville, Tex.Com. App., 291 S.W. 206. Nor can we agree with appellant that this note is not negotiable because it contains a warrant of attorney wherein judgment may be confessed before maturity. This point was decided contrary to appellant's contention in Beard v. Baxter, 258 Ill.App. 340, and cases therein cited, where it was expressly held that a promissory note containing a warrant of attorney to confess judgment either before or after maturity of the note, does not prevent it from being negotiable.

Appellant argues that as this contract was executed in Kentucky it is governed by the laws of this state even though the note was payable in Chicago, and cites William Glenny Glass Company v. Taylor, 99 Ky. 24, 34 S.W. 711, 17 Ky.Law.Rep. 1331; Troendle v. Highleyman, Ky., 113 S.W. 812. These cases do hold that where a note is signed in one state and is payable in another, that the place of payment does not necessarily determine that the contract is to be construed according...