41 W. Va. 27 | W. Va. | 1895
This is a suit by the bank, assignee, against Thomas S. Spates, assignor, to recover a county draft which can not
In 1887 the court-house and jail of Roane county were destroyed by fire. On the 7th day of February, 1888, the County Court made a contract with E. W. Williams to repair them for the price of twenty one thousand eight hundred dollars, and to be completed against the 15th day of April, 1889. The price was to be paid in three installments, as follows: Five thousand four hundred and fifty dollars to be paid when the work was commenced; the second installment, of eight thousand one hundred and seventy five dollars, to be paid when the work was half done; and the third installment, of eight thousand one hundred and seventy five dollars, being the residue in full to be paid when the court-house and jail were completed according to the plans and specifications. The first installment was to be paid in county orders, made payable out of the levy of 1888, to be delivered to Williams on the 4th day of June, 1888, and to bear interest from the date of issue. For the second installment, viz. of eight thousand one hundred and seventy five dollars, county orders were to be issued to Williams, payable out of the levy of 1889, bearing interest, to be delivered as soon as the work was half done; and the third installment was to be paid in county orders payable out of the levy of 1890. The county paid all these orders, except two, one for one thous- and dollars, which was assigned to defendant, Spates, and by him was assigned to the plaintiff, the Bank of West Virginia, on the 2d day of November, 1888, for the sum of nine hundred and seventy five dollars. The other order was for one thousand dollars, and was assigned by Williams to the Merchants’ National Bank of West Virginia on the 9th day of January, 1889, for the sum of nine hundred and sixty dollars. Both assignments were by indorsement in blank.
Section 8 of Article X of the Constitution prohibits the incurring of any indebtedness by a county court which can not be paid out of the funds on hand and the levy for the current fiscal year, unless all questions connected with the contracting of such debt shall have been first submitted to a
On the 9th day of February, 1894, the County Court for the first time refused to pay these outstanding orders, and notified the assignees of such refusal.
The general issue and the statute of limitations were pleaded, the plaintiff demurred to the evidence, and the court gave judgment for the defendant.
The assignment was made on the 2d day of November, 1888, and this suit was commenced on the 30th day of March, 1894, so that if the cause of action arose at the date of the assignment, five years having elapsed before the suit was instituted, it was barred by the statute of limitations, and there could be no recovery. The case of Mackie v. Davis, 2 Wash. (Va.) 219, was decided in 1796, and has been a leading casein Virginia and in this state on the general doctrine of the assignment of non-negotiable instruments, and the general doctrine there discussed has from that day to this been followed, expanded, and applied in many cases. For citation and discussion of the Virginia cases, see 2 Rob. Prac. 270, 276, et seq.; 1 Bart. Law Prac. 235, 321. As to the transfer of bills and notes by assignment, see 1 Daniel, Neg. Inst. 715 et seq. The assignment may be by delivery and writing the name of the assignor across the back of the instrument. This does not transfer the legal title, but the assignee, the equitable owner, may sue in his own name by virtue of the statute. The assignor warrants by implication, unless it is otherwise agreed, that it is a valid and subsisting debt, and that the maker of the instrument is solvent, or will be when the claim falls due. See Slifer v. Howell; 9 W. Va. 391-397, and cases cited; Jackson v. Hough, 38 W. Va. 236 (18 S. E. Rep. 575). See Nichols v. Porter, 2 W. Va. 13. As a general
It may be said that the assignor by implication warrants that the face of the order is a true description of its character; that it is genuine; that he is a lawful holder, having a valid title, and a right to transfer it; but that here, the county order being drawn upon and payable out of levies yet to be laid in years yet to come, thereby creating a debt without a vote of the voters of the county, and for that reason unconstitutional and void, showed upon its face that it was invalid, and not a charge upon the county, and that the plaintiff, the assignee, was presumed to know the law, and, in the absence of fraud and misrepresentation, could not recover the price paid the defendant [see Christy v. Sullivan (1875), 50 Cal. 337; Otis v. Callum (1875), 92 U. S. 447; Littauer v. Goldman (1878), 72 N. Y. 506; 1 Daniel Neg. Inst. §§ 730a, 734a; Rogers v. Walsh, 12 Neb. 28; (10 N. W. Rep. 467)]; that the assignee got all he knowingly contracted for, and therefore he can not say he got no consideration, or that the consideration has failed, although the county order has turned out to be of no value (see Newmark, Sales, § 388, note 5). I do not deem it necessary to discuss this question further. I understand the law in this state to be: That when the assignor put his name across the back of this invalid order he guaranteed that notwithstanding its apparent invalidity, it would be paid if the assignee used due diligence to collect it,
In an action for deceit in the sale of property the cause of action accrues at the time of the completion of the sale, and the statute of limitations begins to run at once. Rice v. White (1833), 4 Leigh, 474. The same rule must apply in the assignment of an invalid county order. There is a breach at once of the implied warranty that it is a valid subsisting claim. The right of action accrues immediately, and the fact of the vendee’s inability then to ascertain the quality or condition of the property will not change the rule. See Busw. Lim. § 176, and cases cited. The breach of warranty of the validity of the order then occurred. The failure of consideration may be said to be then complete, because none was received, and the right accrued to the assignee to recover back the money paid by action for money had and received. See Jackson v. Hough, 38 W. Va. 236 (18 S. E. Rep. 575). Against such demand the period under the statute of limitations is five years, and it begins on the receipt of the money, for that is the breach of the contract of implied warranty. It is not deferred until damages ensue. See 13 Am.
I think the trouble with plaintiff’s case is that in bringing its suit it went upon that part of the contract of assignment imported into it by operation of law by reason of the invalidity of the thing assigned, giving the assignee right of action instanter to recover his money back as paid without consideration, and therefore had and received by the assignor to his use, and in this I lay no stress on the mere form of the action. But when the assignee comes to answer the plea of the statute of limitations, then it wishes to go by the otherwise manifested intention of the parties that there was to be no right of recourse until the county order became due and payable, which necessarily implied that the order was treated as a valid and subsisting debt, whereas, on the contrary, such implication must be regarded as overridden by the fact that the law imputes to each of the contracting parties knowledge that the order is null and void. What facts does the evidence show which, if pleaded by replication in avoidance of the plea of the statute, could
This case docs not impress me as a hard one on the assignee, quite apart from the statute of limitations; and upon an equitable view of the case, such as may properly be taken in this equitable action, I think the court was right in saying that the law of the case upon the facts proved was for the defendant. I can not but think that if the defendant had kept the order, or it had been returned to him in 1890 or 1891, he would have got the money. He would have used ordinary diligence to collect it, and it would have been paid long before the 9th day of February, 1894, and there would have been no occasion for the order of the county court entered on that day. The evidence tends to show the as-signee’s neglect to obtain such voluntary payment when it was in its power to do so. It was not until February or March, 1894, that defendant was informed that the order had not been paid, and payment thereof demanded of him ; and up to that time he had never seen it or heard a word about it. What has the assignee, the bank, to say upon this subject—as to the diligence used to collect this order ? Some time in the latter part of 1893 or first of 1894, it was sent to the cashier of the Bank of Spencer, Roane county, who replied by letter: “You may look for the payment of it.” “The sheriff says he will pay it.” If there was any other effort at any other time to collect it, or to return it to the assignor and let him collect it, evidence of such fact nowhere appears.
Asa matter of fact, the claim was lost by the negligence of the assignee, and it Is not against conscience that it should be the one to lose. It now says that it was not bound to take any legal steps, because, the order being invalid, such suit would have been unavailing. Granting that, why did it not make a return, or a timely offer to return, the order to the assignor? See Drane v. Scholfield, 6 Leigh, 386, 394; Wilson
As a matter of law, the claim sued on is baa-red by the statute of limitations. In equity and good conscience it is barred because, as a matter of fact, it has been lost by the negligence of the assignee.
Judgment affirmed.