First National Bank v. Harvey

137 N.W. 365 | S.D. | 1912

Lead Opinion

McCOY, P. J.

Plaintiff brought this action to recover of defendant the amount claimed to be due upon two alleged promissory notes, viz., one note for $700, dated March 31, 1906, due one year after date, payable to the order of plaintiff and purporting to be signed by Lizzie E. Jones as maker thereof and which note had indorsed on the back thereof, “Paid by J. G. Lund 9-5-’06, $200.00,” and “For value received I hereby sell and assign to the First National Bank of West Minneapolis, Minn., or order, the principle and interest of the within, and guarantee same waving demand, notice and protest. J. G. Lund”; and one other note for $2,000, dated June 16, 1906 due one year after date, payable to the order of J. G. Lund and purporting to be signed by Lizzie E. Jones and Stella A. Beam, by L- E. Jones, which "note had indorsed thereon, “Without recourse, J. G. Lund,” and “For value received I hereby guarantee the payment of the within note at maturity, or any time thereafter, with interest at the rate of - per cent, per annum, until paid, waiving demand, notice of non-payment and protest. J. G. Lund.” The defendant, Lizzie E. Jones, who is now Mrs. Lizzie E. Harvey, denied that she ever made, gave, or executed either of said notes, and that the same are forgeries; and if the signatures thereto of Lizzie E. Jones are in fact her genuine signatures, the same, were procured by means of some fraud, circumvention, or legerdemain unkno'wn to her. The jury found with defendant upon all the issues. Plaintiff appeals.

Appellant first contends that the evidence is insufficient to justify the verdict, but we are of the opinion that there was ample evidence submitted to justify the verdict. It will serve no useful purpose to set out the voluminous evidence herein. Many alleged errors are assigned based upon the reception or rejection of evidence. Mrs. Harvey was examined as a witness in her own behalf, and on direct examination was asked to testify in relation to a certain conversation had with J. G. Lund in the spring of 1908, the exact date of which conversation is not shown by the record, but the same occurred during a settlement between her and Lund of their business transaction concerning a real estate contract, the final settlement of which was evidenced by a written memorandum bearing date June 24, 1908. Mrs. Harvey was permitted to testify, over the objections of plaintiff, that the same was hearsay and not within the issues; that during the progress of said settlement she asked Lund what the mention of a $700 note appearing in her contract meant, and to which Lund replied, “I do not know, but guess somebody else’s contract got mixed up with this.” It is contended by appellant that this testimony should not have been admitted because the conversation took, place long after the said note had been transferred and assigned to plaintiff; that as to plaintiff the said conversation and statements of Lund were hearsay and not binding upon plaintiff.

[1] It is a general rule that the statements of a former owner of negotiable paper made concerning the same, after a transfer thereof to a third party, are not binding upon such third party and are hearsay, but there are some well-recognized exceptions to this general rule, and we are of the opinion this testimony is clearly within the exceptions. It seems to be held by many courts that, where a note is obtained by fraud or circumvention and is transferred to a party who participates in such fraud, and where the transfer itself was fraudulent and made for the purpose of cutting off the defense of the maker of the note as against such fraud and circumvention, then and under such circumstances the original payee of the note is still deemed to be the owner thereof, and statements made by him are competent and proper evidence to go-to the jury on the question of fraudulent intent in the inception of the note sued upon.

[2] When the question of the admissibility of this evidence as to said conversation with Lund arose on the -trial, it was for the trial court to determine whether the evidence then given was sufficient to authorize the jury in finding that 'said notes were obtained by fraud and circumvention; whether said Lund, notwithstanding said purported transfer to plaintiff, still had such an interest in said notes as would render his statements admissible; whether said transfer to plaintiff was in bad faith and made for the purpose of cutting off defenses of the maker; whether plaintiff participated in the procuring of said notes by fraud and circumvention and the bad faith transfer thereof to plaintiff; if the facts and circumstances then before the jury were sufficient to warrant them in so finding — then the court committed no error in overruling plaintiff’s objections. 1 Ency. Ev. pp. 532 to 537; Holmes v. Roper, 141 N. Y. 64, 36 N. E. 180; Gardner v. Barden, 34 N. Y. 433; McKean v. Adams, 11 Misc. Rep. 387, 32 N. Y. Supp. 281; Hogan v. Sherman, 5 Mich. 60; 6 Ency. Ev. pp. 14-16; Smith v. Livingston, 111 Mass. 342; Mee v. Carlson, 22 S. D. 365, 117 N. W. 1033, 29 L. R. A. (N. S.) 351; Iowa Bank v. Sherman, 19 S. D. 238, 103 N. W. 19, 117 Am. St. Rep. 941.

[3] The defendant, Mrs. Harvey, testified that never to her knowledge did she execute either of said notes sued upon in this action, and that she never s-aw either of said notes until the same were presented to- her for payment at her home in North Dakota in December, 1908; that the first she ever knew or heard anything about a $700 note in connection with her deals with Mr. Lund was in the spring of 1908 when she had said conversation with Lund — the statements contained in which conversation are objected to by plaintiff — and never heard of said $2,000 note until the same was presented to her for payment. It appears that Mrs. Harvey was formerly Lizzie E- Jones, and as such had business dealings with J. G. Lund, at his office in the city of ' Minneapolis, concerning the purchase and sale of said real estate. and that on March 31, 1906, they entered into what was denominated a “half profit contract of purchase,” whereby she was to furnish certain funds to him to be invested in real estate, and whatever profits accrued from the investments were to be divided between them. The said contract contained a clause as follows: “Cash $1,600.00, note $700.00 due one year, and assume mortgage $3,000.00, and 'by credit $200.00.”

Mrs. Harvey testified this clause of the contract had been altered and changed after the execution and delivery thereof by her by writing therein the words and figures: “Note $700.00 due 1 yr., and assume mortgage $3,000.00 and by credit $200.00” —.that after the figures $1,600 there was a blank line when she executed and delivered the contract, and that the balance of the clause had been filled in thereafter by some on'e without her knowledg'e or consent, and that she first discovered the alteration when making a final settlement of her land dealings with Mr. Lund in 1908, at the time the conversation took place to which plaintiff makes objection. Mrs. Harvey testified that on March 31, 1906, at the time said contract was executed, no mention was made of a $700 note, or the necessity thereof; that all that was required of her was to put up $1,600 cash; that she at that time did not have the cash, but expected to receive the same in a few days from Iowa from a sale of land there; that Lund stated he would let her have the cash; that on that day she did execute and deliver to Lund her note for $1,600, payable on demand, with no payee named therein, payable at the First National Bank of West Minneapolis, Minn., and which note she thereafter within a very short time paid to Lund, but which note was not redelivered to her until long after the commencement of this action; that she at no time ever had any business transaction of any kind or character with plaintiff, and never, as a matter of fact, knew that such a bank existed until long after the time of the purported making of said notes sued upon in this action. Mrs. Harvey further testified that on the 16th day of June, 1906, she was in the office of Mr. Lund in company with Stella A. Beam, a school-teacher; that no- business was transacted; they only talked regarding investments. “On June 17th I was again at the office of Mr. Lund and left with him for safe-keeping for Stella Á. Beam $100 of her monej". I had told her I had confidence in him; he said it was safer with him than in a bank; and he gave me á receipt for the money, hie 'then said he wanted a slip to file away in his office to show by whom this money was left, and then he placed a paper before me and asked me to sign my name and the name of Stella A. Beam, by L E. Jones, which I did. There was no writing of any kind on this paper. It was five to seven inches long, and from three to four inches wide, colored paper. I never signed the $2,000 note myself or for Stella A. Beam, by E. E. Jones; never saw or knew of -such note until December, 1908. There was no talk between me and Lund about executing such a note. There was no talk with Stella A. Beam about executing such a note.”,

The evidence further shows that at different times after March 31, 1906, in their land dealings, Mrs. Harvey, as Lizzie .E. Jones, executed three other promissory notes and delivered them to Lund, about which there is no controversy, and all of which notes are accounted for and included in the computations of the final settlement of said land transactions between Mrs. Harvey and Lund, bearing date June 24, 1908; that there was no reference made in sid final .settlement to either of the notes in question in this action, and that the same did not enter into the computations of said settlement in any manner; that the only reference in any way made to a $700 note was in the conversation objected to b] plaintiff; that the said setlement included the whole of the. real estate transactions had between Mrs. Hjarvey and Lund. It further appears that Mrs. Harvey, as Lizzie E. Jones, had resided in and around Minneapolis for some 15 years teaching in the public schools, and in 1906 and 1907 was engaged in running a boarding house in Minneapolis; and, getting married, moved to Dexter, Minn., and later to Bowman, N. D., and that during all said time she was almost continually, before and after ’ leaving Minneapolis, corresponding with Lund concerning their joint land deal, and that she was never in any manner notified, either by plaintiff or Lund, that said notes sued upon in this action were due, and requesting her to make payment, until December, 1908, after the death of Mr. Lund. Neither was any demand at any time ever made upon Stella A. Beam to pay said $2,000 note, although she had been a teacher in the Minneapolis schools for some seven years. The $100 deposit for safe-keeping was entered on the books of Lund as money paid to be invested by him in real estate. Stella A Beam testified the money was left for safe-keeping, and not for investment, and that she had the receipt for the same, and that the same was afterwards repaid to her by Miss Race, Lund’s cashier in his main office.

It appears that Lund had been extensively engaged for many years in the real estate business with offices at Canby and Minneapolis, Minn.; that he caused to be organized the First National Bank of West Minneapolis, the plaintiff, in connection with his real estate business; that he was president and owner of the majority of the stock of plaintiff, was a director, chairman of discount committee, and, in fact, general manager of plaintiff; that the cashier and most of the employes of plaintiff were and had •been employes of Lund for many years prior to the organization of plaintiff. The evidence shows that the said $700 note came into the possession of plaintiff on March 31, 1906, through the Lund land office, and that the same was charged to Lund’s account. The plaintiff does not’ claim ever to have had any business dealings with Mrs. Harvey concerning the making of said note, but the plaintiff obtained it from Lund. The assignment of Lund on the back of said note was not placed thereon until nearly two. years after the same came into the possession of plaintiff; it being claimed that Lund sold his interest in plaintiff bank to Shaffer ■Bros. & Brown about February 28, 1908, and this assignment and indorsement was placed on the 'back of the note on that occasion. This $700 note was made on a printed blank form having printed thereon after the blank space for the name of the payee, “At First National Bank of West Minneapolis.” In the making of this note •the place for the name of the payee was left blank, no^ name of the payee being written therein; the word “at” preceding the name of plaintiff was crossed with a pencil mark; the other written portions of the note are in ink. The note for $1,600 given by Mrs. Harvey to Lund on the same date is on the same form of blank, with the name of the payee left blank, and the word “at” not crossed. All these facts and circumstances, and many more of the same nature, were before the trial court and injury when the court was called upon to rule on plaintiff’s objection to the conversation between Mrs. Harvey and Lund.

The jury would have been warranted, under this evidence, in finding that said purported transfer to plaintiff of said note was colorably only, and not in fact made at all, and that there was no change in the identity of interest or ownership. The fact that Lund, nearly two years after said note went into the possessior of plaintiff as payee thereof, formally assigned the same to plaintiff and guaranteed the payment thereof would have a tendency to show that plaintiff was still exercising ownership. He did not make this assignment on behalf of the bank. If plaintiff was the owner of said note by being the payee, it was unnecessary to again make plaintiff the owner thereof by formal assignment. The jury would have been warranted under the evidence disclosed in finding that plaintiff knowingly participated in the obtaining of said note by fraud and circumvention. This note was made payable to plaintiff, who brings suit thereon as the original owner. It does not purport to be the note of Lund. . .

[4] Plaintiff, being a corporation, could only act by and through its officers and managers.

[5] If this note was forged, or the signature thereto obtained by some fraudulent trick or legerdemain, Lund, president of the bank, did it, or caused it to be done. Plaintiff obtained possession' of the note from Lund. The allegations of the complaint are that defendant, Lizzie E. Jones, executed and delivered said note to plaintiff, therefore, in taking this note, Lund was not acting as Lund of the land department, but as president of plaintiff. The evidence on the part of plaintiff to the effect that it purchased said note from Lund for $686, in due coure of banking business, does not at all correspond to the theory of the complaint. Whatever knowledge Lund possessed as to the origina of the notes in question must'be imputed to .plaintiff. Under the circumstances of this case, the ends of justice should not be defeated by permitting Lund to divide himself into two beings, one as manager and owner of the Luncl land business, and the other as president, director chairman of discount committee, and general manager of plaintiff, and then say that one part of Lund had no knowledge or notice of what the other part of Lund knew or did. For the purposes of this action plaintiff stands in the shoes of Lund, and whatever would have been a good defense and proper evidence against Lund, were he plaintiff, would also be a good defense and proper evidence against plaintiff. As to the $700 note, plaintiff stands as the original payee and original party thereto, and there is no evidence in this case showing that Lund was not still interested in said note at the time he made the statements in relation thereto to Mrs. Harvey, which is the basis of plaintiff’s objections. The assignment of Lund on the back of said note is said to have been placed there on the occasion of his disposing of his interest in said bank to Shaffer Bros. & Brown. There is no evidence showing a sale by Lund to these parties other than an incidental reference thereto in the form of a conclusion.

[6] The burden was on plaintiff to show the bona fides, for value, of the transfer of said note to plaintiff, and by which Lund lost his interest therein. Mee v. Carlson, supra. Plaintiff does not claim to be the owner of said note by virtue of said assignment of February 28, 1908. No consideration of any kind or character from Shaffer Bros. & Brown to Lund has been shown, or whether said transaction was a bona fide real transfer or only fictitious.

[7] One standing in the position of defendant in this case can seldom, if ever, be expected to establish fraud by direct proof, but can only rely upon the visible surrounding circumstances connected with the transactions and acts of the interested parties. Persons committing such frauds act with great caution and secrecy, and the direct evidence thereof is, in most cases, only known to them who participate therein, and .under such circumstances less evidence is required to establish the fact of the fraud than where direct evidence is obtainable. Jones, Ev. §§ 12, 179, and 190; 6 Ency. Ev. p. 18; Burch v. Smith, 15 Tex. 219, 65 Am. Dec. 154, and note.

[8] On the issue of fraud, great latitude is permitted in the introduction of evidence. The whole transaction from start to finish may be scrutinized. Statements and acts of the 'parties before and after the completion of the transaction are competent as throwing light upon their intentions.

[9] The limit of the scope and latitude in the introduction of such -testimony is within the sound discretion of the trial court, and only becomes error when it clearly appears there had been an abuse of such discretion. 20 Cyc. no.

[10] The facts and circumstances of said real estate transaction between Mrs. Harvey and Lund from start to finish were material and a part of the res gestae of the surrounding facts and circumstances of the giving of said notes, which included said final settlement as the final completion of said transactions. The said statement of Lund to Mrs. Harvey, concerning said note for $700, at the time 'said settlement was in progress, was more than a mere declaration or admission against interest, but was a verbal act constituting a part of the transaction itself. Wigmore, Ev. §§ 1745~177&-

[11] The entire transaction between Lund and defendant was relevant, although a part thereof o-ccured after the delivery of said note to plaintiff. Plaintiff called Mrs.- Harvey as its own witness and’ interrogated her in regard to her land transaction with Lund, and defendant was therefore entitled to show the whole transaction. This was the situation as it existed before the trial court at the time the testimony objected to- was offered. We are of the opinion the learned trial court committed no error in admitting such testimony. We have carefully considered each assignment of error and are of the opinion that no prejudicial error exists.

[12] Objections were made to certain testimony of Stella A. Beam concerning her transactions with Mr. Lund, but her evidence as a whole was clearly within the rule defined in sections 2141-2142, Elliott Ev.

[13] A portion of her testimony wa-s not the best evidence, but no prejudicial error occurred by its admission, as such testimony related to certain correspondence purely incidental in its nature and not in issue.

[14] Some objections were made to certain instructions of the court, but such instructions were more favorable to plaintiff than ■were warranted- by the evidence, and would not constitute prejudicial error.

The judgment and order appealed from are affirmed.

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Dissenting Opinion

WHITING, J.

(dissenting). One John G. Lund was, in the spring of 1906 and from that time down to the date of his death in the fall of 1908, engaged in the real estate business with an office at Minneapolis, Minn. From the spring of 1906 down to some time in February, 1908, he was the president of the plaintiff corporation, and during the year 1906 a member of its discount committee. In the spring of 1906 the defendant had -several interviews with Mr. Lund in relation to investing in farm lands. Hje submitted to -her what was called his profit-sharing plan, and their negotiations finally led to an offer by him to buy for her two quarter sections of land on such .profit-sharing plan. He drafted and submitted for her consideration one of the two copies of a contract which ate known in the record as Exhibits “2” and “2^2.” The defendant and Lund -on March 31, 1906, entered -into such contract. Under the terms of -such contract defendant was to'advance $1,600 in cash, but, not having yet received the returns from the sale of some property she had sold, Lund took her demand note for $1,600.

Defendant -contends that this $1,600 was the only money to be advanced by defendant, and that, under their contract, she was to' give no other note, and that none -other was in any manner suggested. The $1,600 note, together with the $700 note in suit, were negotiated by Lund with the plaintiff bank on March 31, 1906. The $700 note was a blank form which read in part: , “Promise to pay to the order of-at First National Bank of West Minneapolis.” By leaving the blank space unfilled and crossing out word “at,” the nóte was made .payable to plaintiff. It is the theory of the plaintiff that the $700 note was executed by defendant under the terms of the land contract entered into on March 31st; that it was executed for the purpose of procuring more money with which to consummate the purchase contemplated by -such contract; and that Lund was defendant’s agent in procuring from plaintiff the money thereon. Exhibits 2 and 2were printed forms filled out to cover the particular contract entered into. After a line wherein was stated the total purchase price of the land to be purchased ($5,500), and the fact that defendant was to pay $1,600 thereof in cash, there followed a line containing no printed matter whatever. Exhibit 2, which was the copy-retained by Lund, had written upon such blank line the following: “Note $700. Due 1 year, and assume mortgages of $3,000 and by credit $200.” Exhibit 2%, being the one the possession of which had been held by defendant, had written upon such blank line: “Note $700, $200 credit from books, and assume mortgages $3,000.” It is the theory of plaintiff that the $700 note sued upon is one and the same as the $700 note referred to in said contract, and that the credit of $200 was given by Lund to defendant in consideration of her having furnished to him a purchaser for 200 acres of other land. On the other hand, defendant contends that, as originally excuted, such contract had nothing written upon the blank line, and that, while she received a credit from Lund for having furnished a purchaser, such credit was neither earned by nor given to her until some time subsequent to March 31st, and must therefore have been unknown at that date. Defendant contends that these blank lines in Exhibits 2 and 2j^ were not filled when the exhibits were signed, and that the blank in 2% was filled without her knowledge upon June 27, 1906, upon the occasion of a visit by her to the office of Lund, at which time she claims to have left Exhibit 2% in Lund’s outer office while she was entering into another contract with Lund in his inner office. She testified that a clerk of Lund’s (being one and the'.same person who drafted the contracts originally) was in the outer office where she left’Exhibit 2%, and knew.of its being there; and it is her theory that,’ while she was in the inner office, said clerk wrote into her copy what’ now appears upon the blank line for’ the purpose of creating an ápparent explanation for the existence of the $700 note which had theretofore either been forged or signature procured thereto by trick artifice, or sleight of hand. Defendant testified that, from the time that she left Exhibit 2% in' the outer office- when going- into Lund’s private office, she never had occasion to examine it until about June 1908, and therefore, until such time, had'no'knowledge of the alteration of such Exhibit nor any notice of the apparent existence of a note for $700 against her. The books of the Lund land office were introduced in evidence. These books tended to corroborate the plaintiff as they gave credit for the $700 note under date of March 31st.

Conceding that all the evidence offered and received, with the exception.of that hereinafter referred tp, was properly received, it was such as was readily susceptible of either of two constructions; finder one of which the -transactions, out of which the notes appear to have sprung, would be such as would tend to show the notes to be the -contracts of defendant and valid in' the hands of plaintiff, under the other of which the transactions, out of which the plaintiff claims the notes to have sprung, would appear tainted with fraud, the notes never to> have had legal existence, no consideration for the giving of the notes to have existed, and the plaintiff not a good-faith purchaser without notice of defenses. The construction which the jury would -place upon the proof submitted would,' from the very nature of the issues raised and the contention of the respective parties, naturally depend largely upon the juror’s views as tb the honesty and integrity of Lund, -thus rendering very prejudicial any incompetent testimony, received under the sanction of the rulings of tire trial court, in-any manner reflecting upon the business methods of said Lund, or tending to prove ány 'admissions made by him.

Defendant was allowed to testify concerning a statement which she claimed Lund -made -to' her in June, 1908, which statement would clearly tend to corroborate defendant in her claim that she never executed the $700 note. Juñe, 1908, was after Lund sold out his interest in the plaintiff. The admission of this last evidence tends to show that -it must have been the theory of the trial court that'any-evidence of what Lund -said or did in relation to the notes 'or the land transactions with which they were supposed to be connected, no' matter if such statements were later in date to, and entirely unconnected with, the execution of the notes, was competent to prove the invalidity of such notes. It must be remembered that we have not presented to us a question of the competency of a party’s statements if received from his lips while a witness upon the stand in this case, nor a question as to the admissibility of statements in' derogation of his title to property by one then in possession of such property, nor a question of the admissibility of 'statements made by one shown to be a co-conspirator with the party against whom the evidence was offered, but solely whether one can testify as to statements made by another, which statements cannot be deemed admissions of the party against whom received. If Lund had made a statement to some party not interested in this action, which statement was made long after the dates of the notes in suit, and in such statement he had specifically set forth the forgery of the notes and detailed the methods used to accomplish the forgeries, under what possible rule of law would it have been competent to call the party hearing such statements and receive his testimony in relation to same"? Respondent has cited some authorities which she claims announce rules admitting such evidence, but an examination of the same show that they are entirely foreign to- the question presented.

My colleague, in the majority -opinion herein, calls attention to the one case where evidence of such statements is admissible, namely, where a note has been transferred for the sole and fraudulent purpose of defeating some meritorious defense. In such case, any 'statement made by the fraudulent transferor, after such transfer, is admissible -against the holder of the note, upon the theory that the transferror is yet the real owner of the note and has no application whatsoever except in a case where there has been a purported assignment of the note. See cases cited in majority opinion. That this rule has no application to the facts in this case seems to me perfectly -clear, and for two reasons: (i) This cause was tried by the trial court, as evidenced by its instructions to the jury, upon the theory that this note should in every respect be treated as a note running to plaintiff as payee and in relation to which no question of transfer by Lund was involved. It is clear that the rule laid down in the majority opinion has absolutely no application except where the statements offered in evidence were made by one who was at one time the owner 'of the note and has passed title to such note for a fraudulent purpose. In view of the instructions of the court, we would have no right to apply such rule to this case for the purpose of sustaining the judgment. (2) Conceding, however, that Lund was the real payee of this note, and that he had put the title to the same into the name of plaintiff in order to defeat some feared defense, meritorious or otherwise, while the bank so held the note, Lund being the real owner, any statements made by him would be admissible in a suit by the bank on the note. But if Lund should afterwards part with all interest in the note, and it should be held by the transferee not for the purpose of cutting out some feared defense, but as the real owner thereof, from, that moment any statements by.Lund impugning the validity of such note become inadmissible in evidence except as they fall from the lips of Lund when a witness in court. In this case, whatever interest Lund ever had in such note, if he had any, passed from him when he sold his interest in the bank, which sale was several months before it is claimed he made the alleged statement.

In McKean v. Adams, cited in the majority opinion, the time rule is recognized that admissions of transferror are admissible when transfer is merely colorable; that case citing Paige v. Cagwin, 7 Hill (N. Y.) 381, wherein it was said: “When such is the fact, there is no change of ownership. The party by whom the transfer is made is still the party in interest; and his declarations are clearly admissible.” In Gardner v. Barden, also cited in majority opinion, it is held, as appears by the headnotes: “The declarations of an assignor are admissible against his. assignee only where the interests of the parties remain unchanged by the apparent transaction and an identity of interests exists between the assignor and assignee.” To same effect is Milliner v. Lucas, 3 Hun (N. Y.) 456. The holding in Holmes v. Roper and in Encly. of Evi., both cited in majority opinion, are exactly in line with the cases referred to above. The cases from Massachusetts and Michigan, as well as the two South Dakota cases cited by my colleagues, are cases in which the rule announced by my colleagues had no application whatever; in .the South Dakota cases this rule was in no manner referred 'to, and in the other cases, while recognized, it was held not applicable to facts proven.

Not only was evidence such as that mentioned above received, but evidence of matters absolutely unconnected with either of the notes and of a nature showing that it must have been offered solely to impugn the honesty of Lund was received. Defendant was allowed to testify in relation to one of the pieces of land described in Exhibit 2J2. “He (Lund) sold it in May, 1907, and he never reported the sale, and, when I began to look him up in 1908, I discovered it had been sold but no report made of it.” She was allowed to .testify”- that Lund never made any purchase of land for her in compliance with a later contract entered into between them, though such fact was absolutely immaterial to any issues raised. Miss Beam was allowed to testify to receiving, in January, 1908, a letter from a clerk in Lund’s office, advising her that there were rumors afloat that Lund was about to fail, and advising her, if she had any money with him, to get it at once. There are other errors in the admission and also in the rejection of evidence which I do not feel called upon to refer to. It surely cannot be claimed that the wrongful admission of the evidence above referred to was not prejudicial.

When we consider .that the case made by 'the evidence of defendant, especially in so far as the obtaining of the signatures to the notes by fraud, trickery, etc., was, at the best, very speculative and conjectural, it was certainly grave error to allow, the same to . be bolstered up (saying nothing as to the bolstering up of the claim of forgery, lack of consideration, and that plaintiff was a purchaser with notice of defenses), by evidence such as this, which evidence the court, by receiving, virtually told the jury was competent and material and to be considered in reaching a verdict.