82 Cal. 636 | Cal. | 1890
This action was brought by plaintiff upon what he alleges to be a negotiable promissory note made.by defendant Seaman to the order of one O. S. Hub-bell, and indorsed and assigned by Hubbell to plaintiff before maturity. Seaman, in his answer, pleads as set-off certain debts due him from Hubbell before the assignment. Plaintiff demurred to this part of the answer, and his demurrer was overruled. After trial, the court allowed certain of these set-offs, and gave judgment for plaintiff only for the balance due on the note, after deducting the set-offs. Plaintiff appeals from the" judgment. The only question presented is, Was the instrument sued on a negotiable note?
The instrument would be negotiable, and in the hands of an indorsee before maturity not subject to any equities of the maker against the original payee, if it did not contain the following clause: “ Should suit be commenced or an attorney employed to enforce the payment of this note, I agree to pay the additional sum of five per cent on principal and interest accrued as attorney’s fees in such suit.” The court below held that this clause rendered the note non-negotiable-; and we think that the court was right in so holding.
When one man promises to pay money to another in the future, if he puts that promise in the form of a negotiable paper, he gives to the promise characteristics which do not belong at all to ordinary indebtedness. If A merely promises—either orally or by common writing
There have been many conflicting decisions in other states on the question whether, at common law, a promise in a note for attorney’s fees, in case suit be brought, destroys the certainty which negotiable paper must have. The point has never been conclusively determined by this court; but in Chase v. Whitmore, 68 Cal. 548, the opinion of the court contains the following language: “ Beside, the note provided for the payment of a reasonable attorney fee, and that, under our code, destroyed its negotiability. In other states, the rule is not uniform upon the subject, some of them 'holding that such a promise does, and others that it does not, destroy the negotiable character of the instrument.” It is contended by appellant that Chase v. Whitmore is not conclusive authority on the point, because in that case the assignment was made after the maturity of the note, and the language quoted was not necessary to the decision,
Judgment affirmed.
Thornton, J., and Sharpstein, J., concurred.
Hearing in Bank denied.