188 P. 371 | Mont. | 1920
delivered the opinion of the court.
This action was brought on a promissory note. The answer denies the allegations of the complaint, except as to nonpayment, and alleges, as an affirmative defense, that the note in question was a part of the consideration for a contract for the purchase of certain lands; was never delivered and came into the hands of the bank’s transferee wrongfully; is without consideration and was to have been placed in escrow with the deed, etc.; and that it was transferred to the bank in an endeavor to defraud respondents. The answer further alleges that the bank had notice thereof0 and was not an innocent purchaser for value, or any purchaser of the note.
Four special findings were returned by the jury, three of which, complained of by the appellant, were to the effect that the bank did have notice of the defense to the note, or had knowledge of facts which would have put a reasonable man upon inquiry. The jury also returned a general verdict for the respondents, and judgment was entered accordingly. Motion for a new trial having been denied, the appeal, is from the judgment and the order of the court denying the motion.
Appellant makes ten assignments of error:
1. Specifications I, II, and III allege error in the admission
2. Specification of error No. IV is on the court’s refusal to-
Section 6761, Revised Codes, provides that where “the case presents only questions of law, the judge may direct the jury to render a verdict in favor of the party entitled thereto. ’ ’ And-in the case of Consolidated Min. Co. v. Struthers, 41 Mont. 565, 111 Pac. 152, this court held that “the right of the plaintiff and defendant to a jury trial upon issues of fact stands upon the same footing. If the pleadings present such issues, prima facie each is entitled to have a jury determine them; but, if during the course of the trial it becomes apparent that there are no such issues in the evidence, the decision falls within, the province of the court.” While it is true the conversation between Gill and Straight was not disputed, it is not alleged that such conversation alone gave notice to the bank, and respondents are not bound by the testimony concerning that transaction alone, but were at liberty to take into consideration all the circumstances surrounding the transaction between the witness Strouf and the bank, and from all the facts and circumstances determine as to whether or not the bank either had notice of any defense to the note or was chargeable therewith, and such issue was properly submitted to the jury.
The fact that testimony is uneontradicted is not alone sufficient to warrant a directed verdict, where the inferences to be drawn from all the circumstances are open to different conclusions by reasonable men. (Arnd v. Aylesworth, 145 Iowa, 185, 29 L. R. A. (n. s.) 638, 123 N. W. 1000; Dibble v. Northern Assur. Co., 70 Mich. 1, 14 Am. St. Rep. 470, 37 N. W. 704; Elwood v. Western U. Tel. Co., 45 N. Y. 549, 6 Am. St. Rep. 140.) In the Arnd Case the court said: “ ‘It is often a diffi-. cult question to decide when a witness is, in a legal- sense,: uncontradicted. He may be contradicted by circumstances as well as by statements of others contrary to his own. In such cases courts and juries are not bound to refrain from.exercising their judgment, and to blindly adopt the statements of the witness, for the simple reason that no other witness has denied them,
Counsel for respondents contends, however, that regardless
The replication admits the execution of the contract and that the note here sued upon is the $900 note referred to in the contract. The appellant here was made the custodian of the escrow papers and a party to the escrow agreement; the notes were payable at the appellant bank. Under the escrow agreement, the first note was payable November 1, 1914, and thereupon it devolved upon appellant to deliver over to respondents the escrow papers. The payment was not made and the appellant retained, possession of those papers, and it cannot be conceived how, under such circumstances, appellant could contend that it did not know of the failure of respondents, and its consequent failure to deliver the deed and other papers as directed.
Had the transfer to the bank been made prior to the breach of the contract, the knowledge of the transaction would not, in itself, defeat recovery, for the bank would have had the right to presume that respondents would fulfill their contract. In the case of Baker State Bank v. Grant, 54 Mont. 7, 166 Pac. 27, it was held that where the bank knew, when it took from the seller of an automobile notes executed by the purchaser, that the car was sold under a warranty and that the consideration for the notes might possibly fail, it was nevertheless a holder in due course, as defined in section 5900, Revised Codes, there having been no breach of the warranty at the time the notes were negotiated, — that the bank had the right to presume that the seller’s contract of warranty would be carried out in good faith.
However, the bank here did not receive the note until twenty-eight days after the breach of the contract, and not until the seller had the right to declare a forfeiture of the contract and thus withdraw the consideration for this note. Surely the bank was not justified in presuming that the seller would not declare such forfeiture, and therefore, at the time the bank took the note, it was as though the consideration had already failed. In
Clearly, there was evidence justifying the finding of the jury that the bank did have actual knowledge of the infirmity or defect,'or knowledge of such facts that its action in taking the instrument amounted to bad faith. (Sec. 5904, Revised Codes.)
• The jury, and the trial court on the motion for a new trial, had the advantage of seeing the witnesses on the stand and noting their demeanor of testifying, and this court will not therefore disturb their findings. The pleadings were sufficient to raise this issue, and the evidence was sufficient to warrant the findings and the verdict.
The judgment and the order of the district court of Fergus •county are affirmed.
Affirmed.