106 P. 834 | Okla. | 1910
This is an action upon a promissory note for the sum of $438.20, executed by defendant in error on the 20th day of August, 1907, to one R. M. Carter, a life insurance agent, in payment of a premium on a policy of life insurance, the same being payable on January 1, 1908. After the execution of the note and before maturity thereof, it was assigned by the payee to the Farmers' Bank of Roff, plaintiff in error, who brought this action and alleged in its petition in substance the foregoing facts, and that the note is due and unpaid.
The defense relied upon by defendant in substance is: That at the time of the execution and delivery of the note by him a contract in writing was executed and delivered by the payee of said note to defendant as follows:
"I, R. M. Carter, agree to refund note given by said I. D. *549 Nichols, for policies No. 1124, 1125, 1126 in the Great Western Life Insurance Co. of Kansas City, Missouri, the amount of note being $438.20, the said Carter gives said I. D. Nichols, until the first day of Jan. 1908, to investigate the said Great Western Life Insurance Co., and if not found satisfactory or as represented to be, the note for $438.20 or the amount in cash $438.20 shall be refunded to the said I. D. Nichols. This August the 20th, 1907." That defendant investigated the insurance company and found the same not as represented and not satisfactory to him, and that before January 1, 1908, he gave notice of these facts to the payee. That prior to the purchase of the note by plaintiff he notified the officers of the plaintiff bank of the foregoing contract relative to said note, and exhibited said contract and the contents thereof to the officers of the bank, who conducted the transaction for it, by which the note was purchased from the payee.
The verdict of the jury and the judgment of the lower court was in favor of defendant.
Several assignments of error have been made by plaintiff in his petition and urged in its brief, but they present in substance but one question, and that is whether the plaintiff is a bona fide holder of the note sued upon. The written contemporaneous agreement relied upon by defendant in his answer is not denied. The note is negotiable in form, and that the same was assigned to plaintiff before maturity in the due course of business for value is not questioned. Whether plaintiff had notice of the contemporaneous agreement and its contents the evidence is in irreconcilable conflict, but, for the purpose of this proceeding, it must be considered that plaintiff had knowledge at the time of its purchase of the note of the contents of the agreement. The sole question to be determined is: What is the effect of the contemporaneous agreement upon the rights of plaintiff who acquired the note with knowledge of such infirmity of payee's title, if any, as existed by reason of said agreement?
It is contended by defendant, and it appears that the trial court proceeded upon the theory, that by the terms of the contemporaneous *550
agreement the delivery of the note by defendant to Carter was conditional, and that Carter could not become the absolute owner of the note until January 1, 1908, and not then if defendant, after having investigated the insurance company, found same not as represented and not satisfactory. The authorities hold that where the maker of a note delivers it to the payee with the agreement that it shall not take effect until the happening of a certain contingency or the performance of a certain condition, and where neither the contingency has occurred nor the condition been performed, the note never becomes operative, and an action thereon by the payee or his assignee with notice cannot be maintained. Johnson v. FirstNational Bank of Morrison,
It is not stipulated in the agreement that upon the happening of the contingencies therein provided for the note shall be invalid, in which respect the facts in this case differ from the facts in Johnson v. First National Bank of Morrison, supra,
cited and relied upon by defendant. That was an action upon a promissory note that was given for seed oats in connection with an agreement that it was not to be paid until the crop matured, and the payee had sold for the maker a certain quantity of the oats at a stipulated price. The agreement in that case by express terms provided that the note should not be paid until the contingency provided for therein transpired, and the payee had performed the conditions imposed. The plaintiff in that case, as assignee, had notice at the time he purchased the note not only of the terms of the contemporaneous agreement, but that such agreement had been violated by the payee. The contract in the case at bar does not provide that the note shall not be paid or shall never become operative if the maker within the time fixed shall, upon investigation, become dissatisfied with the company. *553
It provides only for a repayment of the consideration parted with by the maker by either a return of the note or by the payment to defendant of the amount thereof in cash. And for similar reasons this case may be distinguished fromMcFarland v. Sikes,
The admission of certain evidence and an instruction given by the court have been urged as errors. The actions of the court complained of could be sustained only upon the theory that the agreement destroyed the right of Carter to negotiate the note. But, in view of the foregoing opinion as to the effects of the agreement upon the right of Carter to assign the note, we deem it unnecessary to consider separately these assignments.
The judgment of the trial court is reversed, and the cause remanded for further proceedings in accordance with this opinion.
All the Justices concur. *554