188 Iowa 1237 | Iowa | 1920
This action is upon two promissory notes, each dated October 15, 1917, and each for the sum of $500. These notes were signed by one W. E. Heiserman and by the defendant, S. S. Patterson. Patterson alone, the defendant, appeals, and he interposes two defenses:' (1) That the notes were altered in a material matter after their execution; and (2) that the plaintiffs are not the holders of the notes in question “in due course.”
The defense that the notes were materially altered, was based upon the following alleged facts: That though, at the time the notes were executed by this defendant and Heiser-man, the name of the payee was blank, yet, at the time the notes were delivered to the plaintiff, the name of the plaintiff was filled in as payee, and the plaintiff, without the knowledge and consent of this defendant, and in violation of the authority given to Heiserman, erased its. name as payee, and substituted the name of Emma Heiserman. This is what defendant says was done, and on this he bases his claim.
The second defense is based on the following claim: That he signed these two notes, with the name of the payee blank, with Heiserman, with a distinct understanding and agreement that one of them ivas to be used in liquidation of an outstanding debt in the sum of $500, and the other, to secure an additional loan of $500, for the purpose of paying certain wholesale debts of Heiserman’s; that, as a matter of fact, both of the notes were negotiated as collateral
The case was tried to a jury, and a verdict returned for the plaintiff for the full amount of the notes.
There is no controversy in this case as to the signing of the notes, and as to the condition of the notes at the time they were signed by defendant. The name of the payee was then blank. The jury could well find, under this Recor d, that, at the time the defendant signed the notes, he authorized Heiserman to negotiate them and to fill in any name as payee that he found necessary, in order to make them effectual for the purposes for which they were executed; that, when the defendant signed these notes and left them with Heiserman, there was authority on the part of Heiser-man to- procure money upon the notes to the amount of the notes; and further, that the source from which the money was to be obtained was not determined, as between the defendant and Heiserman, before or at the time the notes were signed and delivered to Heiserman to be negotiated. The record' discloses that the notes were signed, and left by defendant in Heiserman’s possession; that, without filling in the name of any payee in these notes, Heiserman went to the plaintiff bank, exhibited the notes, and told them that he desired to get money on them; that, before the notes were negotiated, and before any money was paid by the plaintiff upon the notes, Heiserman placed the name of this bank (plaintiff) as payee in the notes; that the notes were then brought to this bank, and the plaintiff refused to accept them with its name as payee. Thereupon, with the consent of Heiserman and' his wife, its name was erased from the notes, and the name of Heiserman’s wife placed in the notes, and she thereupon endorsed the notes in the following language:
“[Signed] Emma Heiserman.”
Thereafter, the notes were negotiated to this plaintiff, and the plaintiff paid to Heiserman the full amount of the notes.
There is dispute as to these facts as we have recited them, but the jury could well have found the facts to be as we have stated them. But there is no dispute that the notes were not negotiated to the plaintiff or accepted by. the plaintiff until they were completed by the insertion of the name of Emma Heiserman in said notes as payee. They were not negotiated to nor accepted by the plaintiff until after Emma Heiserman had endorsed the notes to it, as hereinbefore set out.
There is no contention made by the defendant that the evidence is not sufficient to justify the verdict, nor is it contended that there was not evidence to support the special findings of the jury upon the disputed points. The court submitted to the jury special interrogatories as follows:
“.(1) Did the defendant, S. S. Patterson, authorize W. E. Heiserman or the First National Bank of Hawkeye (plaintiff) to use the two notes sued upon as collateral security for the indebtedness of Emma M. Heiserman ?
“(2) Did the defendant, S. S. Patterson, authorize W. E. Heiserman, or the First National Bank of Hawkeye (plaintiff), to use the name of Emma M. Heiserman as payee in the notes sued upon ?”
Both of these questions were answered by the jury in the affirmative, and a verdict was returned for the plaintiff for the amount of the notes.
While, upon this record, many questions might have been raised, touching the liability of the defendant upon the issues made and the evidence submitted, the defendant based bis right to reversal upon iwo propositions only-.
The fifth instruction complained of is in these words:
The theory of the defendant, in complaining of this instruction, as stated in his brief point, is that, by this instruction, the court injected an issue into the case’that was not there; that the plaintiff had not pleaded either ratification or estoppel; and that this instruction told the jury that, if the plaintiff made an admission such as the instruction refers to, and such as the evidence shows he did make, that would be a ratification, and estop the plaintiff from pleading the defenses which he urges. A mere reading of the instruction shows that this objection was not well taken. The court practically said to the jury that they might consider his admission if they found it was made as claimed,
In reviewing this case, we confine ourselves to the errors assigned. While other questions might have been raised, they are not here for our consideration. There was no reversible error in the giving of this instruction.
The first instruction asked, the, refusal to give which is complained of, is this:
This instruction could not have been given in the form in which -it was asked. The instruction says that, where an alteration appears upon a paper, and no explanation is made of the alteration, there is a presumption that it was made by the plaintiff fraudulently, and that that, in itself, destroys the contract, and justifies the jury in finding for the defendant. The alteration may have been made by the consent of the parties. It may have been made under such circumstances as would be justified. Thus, Section 3060-al4, Code Supplement, 1913, provides:
“Where the instrument is wanting in any material par
This instruction would destroy that statutory right, if enforced as presented by the defendant. While it may be true that, in case of a material alteration appearing upon the face of a paper, made after delivery, the burden of explaining or justifying the alteration is on'the person claiming under it, and while it may be assumed that the alteration was made by the plaintiff, yet the fact that an alteration appears,, without showing that it was a material alteration, made after delivery, would not defeat recovery, even though made by the plaintiff.
We think there was no error in refusing to give this instruction in the form in which it was drawn.
The sixth instruction asked by the defendant is as follows :
The Heisermans were not witnesses in this case, and what was done at the time these notes passed into the plaintiff’s hands is shown only by the testimony of the plaintiff’s officers, who transacted the business for the plaintiff in the taking of the notes; and this testimony shows the follow* ing facts:
L. E. Bopp, cashier of the plaintiff bank, testified:
“I had a conversation with Patterson, in which he stated that he signed the notes in blank, so we could fill in
It is apparent that the plaintiff bank refused to accept
There is no complaint made of any instructions given, except Instruction 5, hereinbefore set out, and no error is
The grounds presented here for reversal do not justify us in interfering with the action of the court below, and the cause is — Affirmed.