194 P. 748 | Cal. Ct. App. | 1920
The action was brought by the indorsee of a promissory note given in consideration of the sale of a certain stallion. The defense is that there was a failure of consideration by reason of the false and fraudulent representations made by the seller as to the age, soundness, and procreative ability of the horse, and that "a pretended indorsement or assignment of said note was made by the said Norm W. Thompson [the payee] to plaintiff, but said indorsement or assignment was fraudulent and void; that plaintiff, at the time said note was indorsed and assigned to him, knew that the same was without consideration and void, and knew that the said stallion was unsound and diseased in body and was worthless to said defendants, and said plaintiff did then and there conspire with said Norm W. Thompson to cheat and defraud the said defendants by having said note indorsed by said Norm W. Thompson to said plaintiff for the purpose of preventing the said defendants from making their defense of want of consideration when suit should be brought upon said note."
It may be that the defendants were "stung" as one of the witnesses expressed it; it is quite probable, indeed, that Thompson perpetrated a fraud in inducing the purchasers to rely upon his representations as to the character of the horse.
But be that as it may, there can be no serious doubt that the judgment of the trial court must be upheld upon the other ground that plaintiff was "an indorsee in due course," — in other words, that he "in good faith, in the ordinary course of business, and for value, before its apparent maturity or presumptive dishonor, and without knowledge of its actual dishonor," acquired the note duly indorsed *182
to him. (Sec.
"It may be here stated that the court has found nothing in the testimony indicating that at the time of the purchase of the note anything occurred or anything appeared which would have caused a reasonable person, in the situation of the plaintiff, to question the validity of the instrument, or that it was not executed for a good and sufficient consideration.
[2] "It is urged that the purchase of the note at a ten per cent discount was of itself sufficient to cast a cloud upon the transaction and also the fact that the transaction *183
took place between eighty and a hundred miles distant from the place where the note was executed. The apparent reason for Thompson's presence in the city of Oakland to visit his brother-in-law, who was an employee of the plaintiff, answers any objection that may be made as to the transaction occurring in Oakland rather than in Manteca. So far as the plaintiff was concerned, Thompson was there for a legitimate and valid reason. His presence under such circumstances would not call for inquiry or arouse any suspicions. That Thompson was taking notes from farmers where he had sold different stallions is also true. That the different notes ran over a considerable period of time, and thus deprived Thompson of the use of ready money, appears also to be a fact. And, considering that the note in controversy had something over a year to run, and that the use of ninety per cent of its face value would mean more to Thompson, if paid then, than the full amount of the note obtained after a delay of more than a year, the court cannot very well come to the conclusion that a ten per cent reduction was at all out of the ordinary, or such as to raise an inference that the plaintiff knew he was buying, or ought to have known that he was buying a tainted instrument." The trial judge then called attention to the distinguishing features of the several cases upon which appellant relies, and after citingEames v. Crosier,
It seems unnecessary to add anything to what was stated by the trial judge. Even if we concede that the evidence might support a finding that plaintiff was not a purchaser in good faith, it cannot be gainsaid that the court was amply warranted in reaching a contrary conclusion. The *184 trial judge was in a position to gauge properly the testimony of the plaintiff, and it would be presumptuous in us to say that he was misled.
The judgment is affirmed.
Prewett, P. J., pro tem., and Hart, J., concurred.