77 Neb. 205 | Neb. | 1906
This action was begun in the district court for Nuckolls county, Nebraska, to recover the amount alleged to be due upon a certain promissory note, executed by the defendant and payable to the Leader Fence Machine Manufacturing Company, and alleged to have been indorsed for a valuable consideration to the plaintiff before maturity. Eefendant, for answer to plaintiff’s petition, admitted the execution of the note, and denied that the note was purchased for value, and without notice, by the
At the trial of the cause plaintiff assumed the burden
Cross-examination: “Q. Do you know where Mr. Barber came from when he came to sell this note? A. I do not. Q. Had you seen him before that? A. Yes, sir. Q. Where and when? A. In the bank, at a previous time. Q. Had he made some arrangement, or had some conversation with you relative to the purchase of certain notes that he might obtain? A. No, sir. Q. Did you have any intimation of any kind that he would bring certain notes to you to purchase? A. No, sir. Q. What was the nature of his conversation with regard to this paper? A. He presented us a bunch of paper, and asked us on what basis we would
Defendant then took the stand on his own behalf and testified that the note was given to a Mr. Fiefield, who was an agent of the Leader Fence Machine Manufacturing Company, and offered to prove by himself and others that Fiefield, representing the fence machine company, made the representations alleged in the answer to procure defendant’s signature to the note; and that the machines, for which the note was given, were an entire failure and did not build fences as represented, were not practical in any way, and were absolutely worthless; and also that the machines were to be sent to Nelson, freight prepaid, which was hot done; and that as soon as defendant had discovered the fraud and misrepresentations he offered to return the machines and supplies that he had received from the company. This offer of proof was denied by the court, and, no other testimony being offered, the court directed a verdict for the plaintiff for the amount of the note and interest. In the case of Violet v. Rose, 39 Neb. 660, after a careful and painstaking review of the former decisions of this court, the rule was established that, where fraud is alleged in the inception of the note, the burden is on the plaintiff to prove the tona fides of the transfer; but, where a want of consideration is relied upon, the burden is on the defendant to show the mala fides of the transfer. It is also determined in this case that the order of proof, where failure of consideration is pleaded against an indorsee, rests in the sound discretion of the trial court, that is, that the court may permit testimony tending to show a failure of consideration before evidence tending to impeach the good faith of the indorsement has been offered. Now in the case at bar plaintiff on his own volition introduced evidence, already set out in this opinion, tending to show the good faith of the purchase of the note in suit, and the only evidence offered by defendant touching on this question was such as was elicited from plaintiff’s pres- '
The question of the solvency of the makers was not placed in issue by the proof offered, so that the only question to determine is whether or not the discount for which the notes were purchased, standing alone, is sufficient to show bad faith in their purchase, while the purchase of negotiable paper on a known solvent maker for a sum materially less than the face of the paper is often referred to by judges and text-writers as a circumstance tending to show bad faith in its purchase; yet, unless the consideration is grossly inadequate, this circumstance alone is not sufficient to establish the mala †Ides of the transfer.
We are therefore of the opinion that the evidence offered was wholly insufficient to show either bad faith or want of consideration in the purchase of the note, and, consequently, it is immaterial whether the evidence offered by defendant tending to show a want of consideration as between the original parties to the note had been admitted or excluded, for in either event an instruction directing a verdict for the plaintiff should have been given. We therefore recommend that the judgment of the district court be affirmed.
By the Court: For the reasons given in the foregoing opinion, the judgment of the district court is
Affirmed.