36 Barb. 284 | N.Y. Sup. Ct. | 1862
By the Court,
This action is brought upon a note made by a firm to one of its members, for money advanced by such partner to the firm. The note was indorsed by the payee to the plaintiff. The referee held that inasmuch as the payee, being one of the partners, could not maintain an action against the firm, therefore the holder could not recover when it was transferred by the payee ; except in the case of a bona fide holder for value. The referee also found that the plaintiff took the note after maturity. It is settled that a partner cannot maintain an action against the firm on such a note. And it is equally well settled that the holder may maintain an action, where such a note is transferred before maturity, for value. (Smith v. Lusher, 5 Cowen, 688.) The only question in this case, remaining, is whether the holder may not recover if the note is taken after maturity. It must be remembered that in this case the defense is not to the consideration. The note was given for money actually advanced to the firm. Its validity is not questioned. In the hands of the partner it was a valid security against the firm, for the face of it, that could at any time have been enforced by the partner, against the firm; and the only difficulty was as to the remedy to which the
But the claim of the plaintiff is only in accordance with the contract. The firm promised to pay a sum of money received by them from their partner, to him, or to the person he might order to receive it. By the indorsement he ordered the payment to be made to the plaintiff. So long as the defendants have no objection to the original consideration and to the validity of the note, the transfer of it to the plaintiff made the firm liable to him for the amount of it. It may have been subject to any offset which the firm had, but no such defense was proved; and in the absence of such proof, the defendants cannot avail themselves of the defense that
Ingraham, Leonard and Gierke, Justices.]
The judgment must be reversed, and a new trial ordered; costs to abide the event.