50 Iowa 262 | Iowa | 1878
Lead Opinion
The question presented is as to whether the plaintiffs acquired a good title to the note. The note is negotiable, and they claim to be bona fide holders. In Central Bank of Brooklyn v. Hammett, 50 N. Y. 158, the bona fide holder of a negotiable note is defined to be “one who has acquired title in good faith, for a valuable consideration, from one capable of transferring it, or from one in the possession of paper with an apparent right to transfer it, and without notice of any defect in his title or right to transfer. ” The appellants claim, however, that McCall did not acquire a good title, and that the plaintiffs took the note from him with notice. They took the note with notice, of course, of whatever appeared on its face. Now it is said that it appeared on the face of the note that McCall was the secretary of the company. While, then, he held the note, it is said he should have been regarded as holding it as the secretary of the company, as the fact really was. The appellants cite Claflin et al. v. Farmers’ & Citizens’ Bank of L. I., 25 N. Y. 293. In that case the plaintiff sought to recover upon a check drawn, certified and negotiated by the president of the defendant bank for his own benefit. The plaintiffs claimed to be bona fide holders, but the court held otherwise.
The doctrine of that case is, we think, not applicable to the case at bar. The note was made payable to the order of Edmund Miller, and by him indorsed. The presumption arising from the face of the note and indorsement was that the note had been negotiated to Miller, and by him trans
The defendant pleads usury, but we omit to pass upon the question. Most of the essential facts touching the plea of usury are similar to those in the case of Pond against this defendant, decided at this term. There must.be usury, we think, if McCall’s title to the note were valid. We are inclined to think it was not, and that there is no usury; but McCall is not a party to this action, and we leave the question undetermined.
Reversed.
Rehearing
OPINION ON REHEARING.
The evidence in this ease tends strongly to show that McCall acquired no title to the note. We are inclined to think that such is the fact, and that, in procuring the note from defendants’ treasurer and transferring it to the plaintiffs,
The fact of the extension was testified to by one of the ■plaintiffs in these words: “Plaintiffs agreed with McCall to •extend the time of the payment of said note. The terms were to extend the payment of the two thousand dollar McCall note until the three thousand dollar note in suit came due. 'The agreement was verbal, through Howe, and by correspond•ence between me and McCall.” The defendants insist that this is insufficient; that Howe-’s testimony should have been taken and the correspondence should have been produced. Whether the witness knew what Howe did in such a way that he could properly testify to it may admit of some doubt, but it is not for us to say he did not. As to the correspondence it is sufficient to say that secondary evidence is admissible L unless it is objected to. These propositions, indeed, we do not understand to be seriously questioned. But it is insisted
The same witness states that the note was acquired without notice of defects, and the suspicious circumstances urged as overcoming the evidence, we think, are not sufficient.
The defendants say that if the rule in this case is correct corporations are at the mercy of their officers. Corporations, like natural persons, are at the mercy of every one who has the disposition and opportunity to steal their negotiable paper and put it in circulation. But the importance of protecting-them is not such as to justify the adoption of a rule which would go far to impair the peculiar value of such paper-derived from its negotiability.
The defendants insist that the evidence shows usury. If the defendants made a usurious contract they made it with McCall. But they insist, and in this we think they are correct, that they made no contract with him of any kind.
We think that the petition for a rehearing must be overruled.