71 Mo. App. 291 | Mo. Ct. App. | 1897
The defendant executed three negotiable promissory notes for $100 each to the Winkler Machine Manufacturing Company, a corporation. After the maturity of the notes the payee therein transferred them by its indorsement thereon to Campbell, who later on transferred them by his indorsement to. the plaintiff. The plaintiff, the last indorsee, brought this suit against the defendant, the maker.
The answer of the defendant was to the effect that on the thirtieth day of January, 1896, defendant obtained a'judgment against the Winkler Machine Manufacturing Company, the payee in said note, in the circuit court of Jackson county, for the sum of $1,200, •which is unpaid, and due defendants against said company, and was obtained on account of damages to defendant, arising out of the contract for the purchase of a refrigerator by defendant Hueben, from said company, and that the notes sued upon were given as a part of the purchase price of said refrigerator, and said notes grew out of that transaction. That the plaintiff is not in fact now, nor has he ever been, the true and legal owner of the note sued on, nor was M. Campbell ever the true and legal owner of said ■ note, but the Winkler Machine Manufacturing Company is now and has at all times since its execution been the true and
There was a trial and judgment for defendant and plaintiff appealed.
In Tiedeman on Commercial Paper, section 295, it is stated that the indorsee of overdue paper does not take it subject to all defenses that might be set up against the indorsers or against the original- parties. He takes it subject to the defense, first, that it (the paper) had its inception in some fraud or illegality, or was otherwise tainted with some material defect which rendered it void, except in the hands of a bona fide holder, and second, that it was without consideration or that there had been payment or an accord-and satisfaction, or that the title of his immediate indorser was defective on account of some equitable defense arising against him. And this statement of the law by the learned author finds abundant support in the great multitude of authorities cited by him in the footnotes to the section just referred to. It was said by Chief Justice Shaw in Fisher v. Leland, 4 Cush. 456, that “when a negotiable note is found in circulation after it is due it carries suspicion on the face. The question instantly arises, why is it in circulation? Why is it not paid? Here is something wrong. Therefore, although it does not give the indorsee notice of any specific matter of defense, such as set-off, payment, or fraudulent acquisition, yet it puts him on inquiry, he
It is said by some of the authorities that a set-off is not an equity (Daniel’s Neg. Inst., see. 1435 a), but in some cases it will be allowed in equity.
This objection was raised by an instruction in the nature of a demurrer and was by the court denied and
In the view which we have taken of the case the instructions can not be noticed. Wendover v. Baker, supra.
The judgment will accordingly be reversed and the cause remanded to the circuit court with directions to be proceeded with in conformity to the convictions of the law which we have herein expressed.