95 N.Y.S. 49 | N.Y. Sup. Ct. | 1905
Two actions are brought on promissory notes by an indorsee, one against the maker and payee and the other against the maker. The complaints set forth the notes and contain the usual averments. The answers are alike and each contains a general denial and three separate defenses and a counterclaim. The plaintiff demurs to each defense on the ground that the same is insufficient in law upon the face thereof, and also to the counterclaim, as hereinafter stated. The facts admitted by the demurrer to- the second defense (the first separate defense) are: Defendants were heavily interested in a railway company and in order to furnish money to said company executed and indorsed the note as maker, payee and indorser, placed the same with a third party for the purpose of having it discounted for the benefit of said company, and the third party informed these defendants after maturity that the note was in her possession, and defendants believe the note now to- be in her possession. If these were all the allegations of this defense it is clear that the demairrer would have to be sustained. But the plea continues “ and denies that said note was ever duly negotiated or discounted for value.” Plaintiff contends that this denial is a statement of a conclusion of law. I am of opinion that the denial that the note was ever duly negotiated for value is the statement of an ultimate fact and not of a conclusion of law. Section 60 (Laws of 1897, chap. 612) of the Negotiable Instruments Law provides: “An instrument is negotiated when it is transferred from one person to another in such manner as to constitute the transferee the holder thereof. If payable to bearer it is negotiated by delivery; if payable to order it is negotiated by the indorsement of the holder completed by delivery.” The popular meaning of “ negotiate ” is the same. The allegation with reference to this note, which is payable to order, is, therefore, equivalent to a denial that the note was ever duly indorsed and delivered for value. A denial in these same words was held by Schnitzer v. Gordon, 28 App. Div. 342, to be a negative pregnant, but, nevertheless, sufficient to raise an issue calling for proof upon the trial. It admits the delivery and indorsement, but
A defense differs from a denial in that the denial puts the plaintiff to his proof and the defense is a plea by way of confession and avoidance. General denials are inconsistent
The allegation that “plaintiff is not a bona fide holder in due course of said note ” is a conclusion of law. It is impossible to determine which of the conditions specified in section 91 of the Negotiable Instruments Law constituting a holder in due course have not been complied with. The allegation “ that said note was executed and indorsed without any consideration” is of itself insufficient. This defense admits the allegation- of the complaint that the payee' indorsed and delivered the note for value before maturity. Value having been given prior to the delivery to plaintiff, he is a holder for value (Neg. Inst. Law., § 52), and the fact that there may have been an indorsement without consideration is immaterial. The allegation that the note “ had, before its delivery to said plaintiff, no legal- inception ” is a conclusion of law and is not helped by the immaterial allegation that the “ transfer to plaintiff was made after maturity ” and the insufficient allegation “ at a rate of discount greater than legal interests and not in the ordinary course of business and is usurious and void.” The defense of usury must set up the usurious contract, specifying its terms and the particular facts relied upon to bring it within the prohibition of the statute. Western T. & Coal Co. v. Kilderhouse, 87 N. Y. 430, 435; Manning v. Tyler, 21 id. 567; Dagal v. Simmons, 23 id. 491; Whitehead v. Heidenheimer, 57 App. Div. 590, 595. The third demurrer
Demurrer to second defense overruled. Demurrer to third and fourth defenses and to counterclaim sustained, with leave to defendants to plead over within twenty days upon payment of costs.