30 Neb. 302 | Neb. | 1890
This action was brought in the Hamilton county district court by E. R. Norman, plaintiff, against Daniel M. Waite, Mira A. Woods, and Austin J. Rittenhouse, defendants, for the purpose of foreclosing a mortgage of real property made by said Mira A. Woods for the security of two promissory notes executed and delivered by the said Daniel M. Waite and Mira A. Woods to said Austin J. Rittenhouse; and by him indorsed to the plaintiff. The petition is in the usual form, with the allegation that the said notes were, before the same became due by the indorsement of the said defendant Austin J. Rittenhouse, for a valuable consideration, “indorsed, assigned, transferred, and delivered to the plaintiff, who is now the lawful owner and holder thereof; that no part of the principal or interest of said notes has been collected or paid, although the $1,000 note has long since become due and payable;” also, that the said Mira A. Woods did not keep the said premises insured as required by the covenants of said mortgage, but wholly failed to do so; that the said Mira A. Woods also wholly failed to pay the taxes due on said premises for the year 1885, amounting to $9.15, as required by the covenants of said mortgage, but made default therein, and on October 29, 1886, the plaintiff, to protect his security and to prevent a sale of said premises for said taxes, paid the same, amounting, with interest; to the sum of $9.15, no part of which has been paid to the plaintiff.
She further alleged that it was expressly agreed between her and the said Rittenhouse, which said agreeement was by parol, that in case he and said Waite should enter into said copartnership, then upon the execution and delivery of said notes and mortgage -by defendant the same should be held by said Rittenhouse as security that the said Waite would remain in copartnership with him, the said Rittenhouse, and perform his part of the duties of said copartnership and permit his share of the net proceeds of the business thereof to be applied to the payment of said sum of $1,500, to be paid to the said Rittenhouse until the same should be fully paid, and that it was expressly agreed that said answering defendant should not be called upon to pay any portion of said sum of $1,500, but that the same should be paid out of said Waite’s share of the proceeds of the business of said copartnership, and that said Rittenhouse should hold said notes and mortgage for security merely, that said Waite would not abandon said copartnership and that said notes and mortgage would not be transferred to any other person or persons. And defendant alleged that she relied upon the representations of the said Rittenhouse, and, believed them to be true when in fact they were false, and, being desirous of assisting her said son, she made, executed, and delivered the notes and mortgage aforesaid as a guaranty that said Waite would not abandon said copartnership without cause, before said sum of $1,500 should be paid to said Rittenhouse, and that said Waite would perform, to the best of his ability, his duties as a member of said copartnership, and would permit his share of the net proceeds*of the business thereof to be applied to the payment of said sum to said Rittenhpuse until the same should be paid, and for no other pur
She further alleged that by the terms of said notes and mortgage the same became due on the first day of May, 1886, and had long been due when transferred to said plaintiff, and that at the time the said plaintiff purchased the same he well knew that the defendant had a good and valid defense to the same and that the same had been obtained by fraud, and defendant denied that said plaintiff received said notes and mortgage in good faith before maturity and for value, and denied every allegation contained in said petition and not in said answer admitted.
The defendant Daniel M. Waite, by his separate answer, admitted the execution and delivery of the notes sued on in the said case, but denied that the plaintiff received the same before due, and alleged that the said plaintiff was not an innocent holder of said notes, but that he took the same with information and knowledge that the same had been obtained through fraud, and with information and knowledge of the defense of him, the said defendant, hereinafter set out, to the payment of said notes; that on the 19th day of February, 1886, said defendant entered into an agree
And defendant further alleged that it was agreed and understood that each of said parties should devote all his time, energy, skill, and ability to the prosecution of said business; that said Rittenhouse and defendant, in pursuance of said agreement, did enter into said copartnership on the 1st day of April, 1886, and that defendant has ever since duly performed on his part every condition and agreement in said contract, and has fully complied with all of his agreements in said contract, but that said Rittenhouse has wholly neglected and refused to comply with said agreement on his part, and on or about the 15th day of June, 1886, wholly abandoned said copartnership, and removed from said city of Aurora and formed a copartnership with one J. S. Le Hew, at McCook, Nebraska, for the practice of law at said place, which said place is more than one hundred and fifty miles from said city of Aurora, and has neglected and refused to perform any service as a member of said firm of Rittenhouse & Waite, and has wholly neglected the business of said firm, and thereby caused persons who had employed said firm of Rittenhouse & Waite to refuse to continue said employment, and to employ other counsel in such cases. And defendant alleged that he had received no consideration for
The replies of the plaintiff to the separate answers of the defendants are, substantially, general denials.
There was a trial to the court, with general findings for the plaintiff as to the execution and delivery by the defendant Mira A. Woods to Austin J. Rittenhouse of the mort
There are two principal questions presented by the record:
1. Is the plaintiff such an indorsee, owner, and holder of the notes secured by the mortgage and declared on in the petition as entitles him to recover tire contents thereof from the makers, although they have a defense thereto as against the payee ? and,
2. Under the pleadings and upon the evidence, were the action between the payee and the makers of the notes, could the former recover ?
Appellants, in the brief of counsel, present two grounds upon both of which they claim that the plaintiff is not an innocent holder of the notes, so as to cut off a defense thereto existing against the payee.
1. That the notes and mortgage were due when the plaintiff obtained them. This proposition is claimed to be based upon a clause of the mortgage which reads as follows : “ It is further agreed that if said mortgagor shall fail to pay such taxes or procure such insurance, the said mortagee may pay such taxes and procure such insurance, and the sum so advanced, with interest at ten per cent, shall be repaid by the said mortgagor, and this mortgage shall stand as security
It appears, both from the petition and bill of exceptions, that the defendant, Mira A. Woods failed to pay the taxes of 1885, which became delinquent May 1, 1886, upon the mortgaged property. Upon these premises counsel for appellants contend that the notes Avere due and dishonored at the time of their transfer by Rittenhouse to the plaintiff, so as to charge the latter with notice of all infirmities and defenses. I am inclined to differ with counsel upon this point, especially in its application to the evidence in the case at bar, but will refrain from a discussion of the authorities cited to sustain it,inviewof the second ground, Avhicli R, that the plaintiff received notice of defendant’s defense to the notes before he parted with the consideration wdiich he paid therefor. It appears from the bill of exceptions that the consideration which the plaintiff paid for the said notes and mortgage consisted of a tract of land .in Hamilton county, AA'hich plaintiff held and was in possession of by virtue of tAvo certain contracts of sale executed and issued by the Union Pacific Raihvay Company; that the contract betAveen plaintiff and Rittenhouse w'as made on the 18th day of September, 1886 ; that the said contracts were then in the possession of plaintiff’s father, in the state of Ohio, and were not delivered to the said Rittenhouse until about ten days thereafter. But on the day of the trade plaintiff executed to Mrs. Rittenhouse, W'ife of Austin J. Rittenhouse, doubtless at the request of said Austin J. Rittenhouse, and as a part of the transaction betAveen Rittenhouse and-Norman for the transfer of the said notes and mortgage, an instrument in writing, wdiich was put in evidence upon the trial and Avhicli I here copy;
“ I, F. R. Norman, party of the first part, have this day assigned and transferred all my right, title, and interest in and to the west one-half of the northwest one-fourth of section No. 11, township No. 9 N., of range No. 6 west, in Hamilton county, Nebraska, to Louisa J. Rittenhouse party of the second part for and in consideration of the sum of fifteen hundred dollars, the receipt whereof is hereby acknowledged, and I do hereby sell, assign, and transfer to her all my right, title, and interest in the two Union Pacific Railway Company’s contracts of sale Nos. 40140 and 40141, which I now own and hold for said land, and I represent that I am the owner of said contracts by assignment from J. H. Stokesbury, and that I will deliver said Louisa J. Rittenhouse said contracts, numbered as aforesaid, with the assignments of said J. H. Stokes-bury to said contracts thereon, written in due form; that I will deliver said contracts within ten days from this date. I, Mary E. Norman, wife of F. R. Norman, do hereby relinquish all my right of dower in the above described land.” Signed by F. R. Norman, and Mary E. Norman, witnessed and acknowledged before a notary public.
The acknowledgment is dated the 18th day of September, 18S6, which is the only date the paper contains.
It appears from the evidence that the transfer of the notes by Rittenhouse to Norman, and the execution and delivery of the above paper by Norman and wife to Rittenhouse, occurred on Saturday, after or shortly before the close of business hours, and there were circumstances of haste and precipitation connected with the transaction, as detailed by the plaintiff when on the stand, and by Rittenhouse in his deposition, which were calculated to have put the plaintiff on his guard in trading for the notes. But there is no direct evidence of the plaintiff having had actual notice of defendant’s defense to the notes and mort
• The plaintiff had bought, but had not paid for the notes and mortgage, when he received actual notice from the makers, of the facts which they then and now claim constitute a defense thereto. By reference to the several answers of the defendants, Mrs. Woods and Waite, as set out in the statement, it will be seen that the defense to the notes and mortgage consisted in the allegation that, contemporaneous with the execution and delivery of the notes' and mortgage, and as the true and only consideration for the execution and giving thereof, the said Waite and Rittenhouse entered into a copartnership for the practice of law and collecting agency, etc., and that as a consideration and compensation to Rittenhouse, who was already established in said business, Waite, who had just finished his course of study in the office of Rittenhouse, and had then lately been admitted to practice as an attorney at law, was to pay to Rittenhouse out of his share of the net earnings of the firm, as fast as the same should be realized, the sum of fifteen hundred dollars, and that the said notes were executed by Waite and his mother’, Mrs. Woods, and delivered to Rittenhouse, and the mortgage executed by the latter upon her house and lot to secure said notes, the whole to be a guaranty or security to Rittenhouse for the faithful performance by Waite of his part of said contract, to the extent that he would continue and act as a member of said partnership until his half of the net proceeds of the earnings thereof should be sufficient to pay the said sum of fifteen hundred dollars, and pay the same to said Rittenhouse,
I do not remember to have seen the law on this subject so clearly stated elsewhere as by Judge Krekel, United States district judge of the western district of Missouri, in his charge to the jury in the case of Michels v. Olmstead, supra, in the following words: “When parties, without any fraud or mistake, have deliberately put their engagements in writing, the law declares the writing to be not only the best, but the only evidence of the agreement; but this does not prevent parties to a written agreement from proving that, either contemporaneously or as a preliminary measure, they had entered into a distinct oral agreement on some collateral matter, or an oral agreement which constitutes a condition on which the performance of the written agreement is to depend.”
I therefore reach the conclusion that the findings and judgment of the district court are neither of them sustained by the case or the law applicable thereto.
The judgment and decree of the district court is
Reversed, and cause dismissed.