258 P. 361 | Idaho | 1927
Lead Opinion
This is an action on a promissory note by one claiming to be a holder in due course, etc. The defense of fraud by the payee named in the note, assignor of the holder, was interposed. At the first trial, the court directed a verdict for the plaintiff, respondent here, and on appeal this court reversed the judgment and ordered a new trial. (Wright v. Spencer,
". . . . We conclude that, when appellant alleged and proved that the title of the corporation which negotiated the instrument to respondent was defective, because of the fraud practiced, the burden was on respondent to prove that he acquired title to the note as a holder in due course. This included the burden of proving that, when it was negotiated to him, he had no notice of the infirmity in the instrument resulting from the fraud practiced by the corporation which transferred it to him, lack of such notice being an element of the statutory definition of a holder in due course. Having proved the fraud, the burden was not upon appellant to prove that respondent took with notice of the fraud, but the burden was on respondent to prove that he took without notice. The court therefore erred in directing a verdict for respondent."
The cause was retried upon the same pleadings, and respondent testified that he took the note without any notice of fraud or other infirmity, for value before maturity. This *422 was the only testimony on this issue. A motion for an instructed verdict was denied, and the jury found for appellant. The court entered judgment, and thereafter granted a new trial. From the order granting a new trial, defendant appeals.
The mere fact that respondent was at one time a stockholder of the corporation, whose agent or officer perpetrated a fraud upon appellant in procuring the note in question, is not sufficient to overcome the positive testimony of respondent that he purchased the note in good faith, for a valuable consideration, without knowledge of any defense thereto claimed by the maker, or any suspicious circumstances in connection with its execution. The trial judge would have been justified, under the evidence, in directing a verdict. (First NationalBank v. Pond,
We have carefully examined the record, and are of the opinion that there was no abuse of discretion in granting respondent's motion for a new trial. (McAllister v. Bardsley,
We recommend that the order appealed from be affirmed, with costs to respondent.
Brinck and McNaughton, CC., concur.
Addendum
The foregoing is approved as the opinion of the court. The order granting a new trial is affirmed. Costs to respondent.
Petition for rehearing denied. *423
