52 N.Y. 399 | NY | 1873
The plaintiff became the owner of the notes in suit, with full notice of the defence now set up, and of the equities of the defendant, and is not, therefore, entitled to the protection accorded to bona fide holders of negotiable paper. The notes were subject to the same defences in his hands that they would have been in the hands of the original payee. (Skilding v.Warren, 15 J.R., 270; Kasson v. Smith, 8 Wend., 437; Story on Prom. Notes, §§ 190, 197.)
The notes were given for personal property; and, in the absence of an express warranty of title, the law would imply such warranty. Every vendor of chattels is supposed to know his title, and to warrant it, if he sells without disclosing any defects that may exist in it. (Swett v. Colgate, 20 J.R., 196; Hoe
v. Sanborn,
In this case there was an express warranty of title by the seller, the payee of the notes. The allegation of the defence is that there was a failure of title to a large part of the property by reason of the illegal acts of the seller, subjecting the same to forfeiture under the revenue laws of the United States. The defendant had the benefit of his purchase in respect to a small part of the property, which he sold before the seizure by the government; and there was, therefore, *402
but a partial failure of consideration. As between the payee and maker of the notes, a total failure of consideration would have been an absolute bar to an action; and a partial failure, a defence pro tanto. The maker would have been at liberty to recoup his damages, by reason of the failure of title to a part of the property, in an action upon the notes. He would not have been bound to rescind the contract in toto, but might retain so much of the property as he had secured a title to, and have his damages for the loss of the residue. (Muller v. Eno,
The defence alleged was that, by reason of certain violations of the revenue laws by the payee of the notes and vendor of the property, and those acting with or under him *403 before the purchase by the defendant, the still and the major part of the other property was liable to seizure and forfeiture to the United States; and that after the plaintiff took possession under his purchase the same was seized, condemned and sold for those violations of law, whereby the title wholly failed, and the property was lost to the defendant. The record of the seizure and condemnation was put in evidence, including the libel of information, and an affidavit, a part of the record, by which it appeared that one Hugh Fisher was the informer against the property. The libel was general, alleging in different paragraphs an infraction of every provision of the statutes, which would work a forfeiture and authorize a condemnation of the property, without any allegation of the time or times at which the offences were committed.
The record alone, then, could not and did not disclose by whom or at what time the penalty was incurred which worked a forfeiture of the property. But it was competent to aid the record, and supply this proof by extrinsic evidence. (Doty v.Brown, 4 Comst., 71; Dunckel v. Wiles,
The judgment must be reversed and a new trial granted.
All concur.
Judgment reversed.