Violet v. Rose

58 N.W. 216, 39 Neb. 660, 1894 Neb. LEXIS 85
CourtNebraska Supreme Court
DecidedMarch 6, 1894
DocketNo. 5513
StatusPublished
Cited by24 cases

This text of 58 N.W. 216 (Violet v. Rose) is published on Counsel Stack Legal Research, covering Nebraska Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Violet v. Rose, 58 N.W. 216, 39 Neb. 660, 1894 Neb. LEXIS 85 (Neb. 1894).

Opinion

Irvine,'C.

Thé plaintiff- in error sued the defendant in error upoii a promissory note dated April 9, 1889, and alleged to have been made and delivered by the defendant to Hiram M. McCurday, and payable to his order one year after date. Plaintiff alleged that on October 22, 1889; McCurday indorsed the note as follows: “I hereby assign the within note to John M. Violet and authorize him to collect the same. H. M. McCurday,” and delivered the note to plaintiff. Rose answered substantially as follows:

Eirst — Denying the indorsement and alleging that Mc-Curday was the owner and the real party in interest.

Second — That whatever interest plaintiff had in the note he acquired with full notice of all the facts, and not in the usual course of business, for value before maturity.

Third — That upon April 9, 1889, defendant executed the note for delivery, upon receipt from McCurday, of a deed of assignment, executed and acknowledged by himself and Catherine McCurday, his wife, conveying to defendant all their interest in certain land in the city of Lincoln, being then their homestead, and that on said day McCurday fraudulently, and without consideration, presented to the defendant a deed of assignment with the names Hiram McCurday and Catherine J. McCurday signed thereunto as apparent grantors, and fraudulently represented to plaintiff that Catherine McCurday had executed the same, that it was her own signature thereunto written, and that she would personally appear next morning before a notary public and make formal acknowledgment of such instrument ; and that, relying upon such representations, defendant delivered the note to McCurday; whereas, in fact, [665]*665said signature of Catherine McCurday was a forgery, and Catherine McCurday never did acknowledge the instrument, and that defendant took nothing by said instrument,, and plaintiff retained possession of the premises until December 1, 1889; that upon December 1, 1889, the said McCurday transmitted to the defendant a quitclaim deed to said premises, but without attesting witnesses, and that during the delay, and while the conveyance was wrongfully withheld, the incumbrance, because of accruing interest, delinquent taxes, and cost of a foreclosure action brought against the McCurdays, so increased that the defendant was compelled to pay by reason of such increase $950, being the whole amount for which the note was given. The answer further' averred that the contract of sale was made with a view to a present conveyance, and, as McCurday knew, in order that defendant might resell at a profit; that defendant afterwards secured purchasers-for said land at a profit to himself of $1,000, but was unable to convey because of the delay of the McCurdays in conveying title, and that since receiving the quitclaim deed the premises have not been salable at all by reason of the pending foreclosure suit.

The averments of the answer were met by a general denial.

A verdict was returned for defendant and judgment entered thereon from which plaintiff prosecutes error.

1. The defendant claimed and was conceded the right to-open and close, whereupon the defendant himself was sworn and was almost immediately asked what was the consideration of the note. This was objected to for the reason that such evidence was inadmissible until it should be first established that the plaintiff was not a bona fide holder. This objection was overruled ánd the defendant permitted to go into the transaction between himself and the McCurdays. Several assignmeiits of'error relate to-this class of testimony.

[666]*666It is a universal principle that in the absence of any attack upon the validity of a negotiable instrument, as between its original parties, the holder bringing the action upon it is presumed to be a bona fide holder for value. When, however, the holder or acceptor in an action against him upon the instrument sets up matter in defense which would constitute a valid defense were the action brought by the original payee, it is frequently a question of difficulty as to where the burden of proof lies upon the issue of bona fides. The writer is unable to perceive why, upon different defenses, there should be any distinction as to the burden of proof upon that issue, whatever the defense pleaded. It may be urged upon one side that the policy of the law merchant, in favoring the free negotiation of bills and notes, demands that the maker, in order to defend against an indorsee, should prove affirmatively that such indorsee is not a bona fide holder for value, and to this argument there may be added that the plaintiff in such a case has already in his favor a presumption of bona fides, and that no evidence of a defense growing out of transactions between the original parties has a natural tendency to rebut such presumption ; but, upon the other hand, whatever may be the fundamental defense, it would seem that the proof of a bona fide purchase for value before maturity lies peculiarly within the possession of the plaintiff; that such facts are always easily susceptible of proof by him, whereas proof of mala fides, or want of consideration, even where the facts exist, is frequently beyond the knowledge or reach of the defendant. These arguments upon either side apply with equal force, whatever may be the fundamental defense, but unfortunately the courts have drawn distinctions between defenses. The numerous decisions disclose a general tendency to cast the burden of bona fides upon the plaintiff where illegality of consideration or fraud is alleged, and in other cases, to cast the burden of showing notice or want of consideration upon the defendant. But [667]*667■even the test suggested by this general tendency of authorities is not trustworthy, for the classification thus resorted to has not been strictly recognized, and possibly it has not been absolutely observed by the courts of any state. While this confusion of authorities is to be regretted, the distinctions referred to, whether well or ill-founded, have been recognized everywhere, and our.own decisions probably approach the general classification referred to as nearly as those of any state. Thus, it has been held that where tisury is established, the burden is upon the plaintiff to show bona Jides. (Wortendyke v. Meehan, 9 Neb., 221; Olmsted v. New England Mortgage Security Co., 11 Neb., 487; Darst v. Backus, 18 Neb., 231; Sedgwick v. Dixon, 18 Neb., 545; Cheney v. Janssen, 20 Neb., 128; Knox v. Williams, 24 Neb., 630; Lincoln Nat. Bank v. Davis, 25 Neb., 376; Blackwell v. Wright, 27 Neb., 269; Richardson v. Stone, 28 Neb., 137; First Nat. Bank of North Bend v. Miltonberger, 33 Neb., 847; Colby v. Parker, 34 Neb., 510.) So also where the evidence established ■ the theft of a note payable to bearer. (Hooper v. Browning, 19 Neb., 420.) So, too, where fraud in the inception of the note is proved. (Haggland v. Stuart, 29 Neb., 69.) On the other hand, where the defense was in the nature of failure of consideration, and the plaintiff, as a part of his case in chief, had introduced evidence tending to show a bona fide purchase, it was held that no testimony in support of the fundamental defense was proper, unless the defendant introduced evidence tending to show that the plaintiff was not a bona fide purchaser. ( Western Cottage Organ Co. v. Boyle, 10 Neb., 409.) In Cannon v. Canfield,

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Bluebook (online)
58 N.W. 216, 39 Neb. 660, 1894 Neb. LEXIS 85, Counsel Stack Legal Research, https://law.counselstack.com/opinion/violet-v-rose-neb-1894.