Wilson v. Kelso

80 A. 895, 115 Md. 162, 1911 Md. LEXIS 133

• Court: Court of Appeals of Maryland
• Decided: February 24, 1911
• Status: Published

Opinion

Burke, J.,

delivered the opinión of the Court.

The appellee, Scott- Kelso, recovered a judgment in the Circuit Court for Washington County for the sum of $1,146.33 against Francis K. Wilson, and from that judgment the defendant has brought this appeal.

The record presents three bills of exceptions. Two relate to the rulings of the Court- upon questions of evidence, and the other to the rejection of the defendant’s seventh prayer.

The Court sustained a demurrer to the defendant’s fifth plea, and overruled a motion in arrest of judgment. The correctness of these rulings is also presented by the record.

The evidence shows that the defendant and twelve other persons executed a promissory note in the following’ words and figures:

“Flixtstoxe, Md., February 15, 1906.

$1000.00.

Two years after date for value received we, or either of us, promise to pay to H. P. Reynolds & Co., or bearer, One Thousand Dollars at the Second Rational Bank of Cumberland, Md., with interest at 6 °f0 per annum,, interest payable annually.”

H. P. Reynolds & Co., the payees named in the note, were horse dealers residing in Pennsylvania, and the note sued on was one of three joint and several promissory notes each for one thousand dollars given to Reynolds & Co. for a German coach stallion sold to the defendant and others.

The note was endorsed by IT. P. Reynolds & Co., and delivered to the plaintiff, and was duly presented for payment and was dishonored. The makers refused to pay the note, and the plaintiff brought suit in the Circuit Court for Allegany county against the defendant and ten other makers of the note.

The case was removed to the Circuit Court for Washington County where trial was had, and the judgment recovered.

Ro mention is made of the motion in arrest of judgment in the brief of the appellant, nor was it adverted to in the oral argument of his counsel at the hearing' in this Court. We think the motion was properly overruled.

The record shows that by an agreement of counsel the Court ordered the clerk to take the verdict. The jury announced a verdict in these words: “verdict for plaintiff and assess the damages at the full amount.” The clerk refused to receive this verdict, and directed the jury to return to the jury room and state the amount of the damages. They then found their verdict for the plaintiff, and assessed the damages at $1,146.33.- This verdict, which is in proper form, was received by the clerk and recorded.

The objection that the clerk had no power to order the jury to correct the form of the verdict is without merit. They did voluntarily correct the form of the verdict, and the objection complained of is merely the correction of an informality.

The Court will not arrest a judgment, except for substantial error apparent upon the face of the record. The correction which the jury made was one which they had a perfect right to make under the circumstances stated.

The plaintiff before the trial entered a non pros as to the other ten defendants, and the case was tried against the appellant as the sole defendant. He pleaded the general issue pleas, and four special pleas setting up fraud, in the procuring of the note by Reynolds & Co., and notice of fraud by the plaintiff before he purchased or paid for the note. The case was tried upon issues joined upon the general issue pleas, and upon issues properly framed upon replications to the special pleas.

We find no reversible error in sustaining the demurrer to the defendant’s fifth plea, which alleged that the payees did not endorse the note to the plaintiff, and that the signature on the back of the note was not the signature of Reynolds & Co., nor made by their authority.

This defense was available to the defendant under the general issue pleas, and, therefore, no injury was done by the ruling on the demurrer. There is not a particle of evidence in the record tending to support the allegation of this plea, and there seems to be no doubt that the note was properly indorsed by Reynolds & Co., as alleged in the declaration.

The plaintiff was called as a witness in his own behalf, and was shown the note sued on. He testified that he was the holder of the note, and that it had not been paid. The note was then offered and admitted in evidence over the objection of the defendant, and this ruling constitutes the first exception.

Where the obligation is joint and several, an ancient and familiar rule of law forbids it to be treated as several as to some of the obligors, and joint as to the rest. The obligee has the right of choice between the two methods of proceeding; but must resort to one or the other exclusively, and can not combine both. He must proceed either severally against each, or jointly against all. When the contract is several as well as joint, the plaintiffs at liberty to proceed against the parties jointly, or each separately though their interest be joint. 1 Chitty Pl. 143; Merrick v. Bank of Metropolis, 8 Gill, 74; Poe Pleading, 2 Ed. section 382.

This rule has been somewhat modified by section 2, Article 50, Code 1904, which provides that “No person shall institute more than one suit on a joint and several bond, promissory note, penal or single bill, when the persons executing the same are alive and reside in the same county; and if more suits than one be instituted on any such bond, promissory note, penal or single bill, judgments of non pros shall be entered against the plaintiff in such suits.”

The plaintiff by dismissing the suit as to all the other defendants elected, as he had a right to do, to pursue his remedy on the note against the defendant alone, and the best evidence of the defendant’s liability on the note was the note itself, which by the pleadings he admitted that he had signed.

The plaintiff, being the holder of the note, must be treated prima facie as a holder in due course, and, therefore, entitled to recover.

The objection to the introduction of the note in evidence is that it discloses a variance between the allegation and the proof. In every litigated question the pleadings must apprise the parties of the specific nature of the questions to be tried, and as this object would be defeated if either parly were at liberty to prove facts essentially different from that _ alleged on the record as constituting the claim on the one hand, and the defense on the other, hence the necessity of the general rule that the evidence must correspond to the allegations, and that the Court must decide secundum allegata et probata; but there can he no variance unless there he a disagreement .between the allegation and the proof in some matter which, in point of law, is essential to the charge or claim:

As the plaintiff elected to hold the defendant separately liable, and as the. note was evidence of that liability, there was no variance, notwithstanding the fact that the note when produced showed that there were other joint and several makers whom the plaintiff might have sued. To hold otherwise would be to tell the holder of such an instrument as the one sued on that he is at liberty to sue any one of the makers separately, and then deprive him of the power to prove his case by the application of the rule of evidence mentioned.

The second exception was taken during the course of the examination of James A. Ash, a witness for the defendant. This witness gave evidence of certain conversations and transactions between himself and a man named Hárman respecting a sale of a horse, and it was proposed to prove “that Harman told witness that the reason Harman came to witness was that Mr. Kelso recommended witness.” This was objected to by the plaintiff.

The Court ruled that it would admit this in evidence if the defendant would follow it up by testimony to show that Harman was there representing the plaintiff. Ash then testified that Harman had asked witness to take him out and introduce him to several farmers; that witness was at two places where a sale was made; that Harman wanted to sell a share to witness, hut witness did not huy; that finally Harman said to witness that there was a share to give away, and that he would «give his share to witness; that Harman said he would give witness a cheek for two hundred dollars when witness signed the note; that he did give witness check when he signed the note, and that witness got the money for it; that the check was either signed H. P. Reynolds or H. P. Reynolds & Co.

Counsel for plaintiff moved the Court to strike out the testimony of Ash, quoted above, to the effect that Hannan told him that Kelso had recommended him to the witness, and that was the reason he had come. Whereupon the defendant offered to prove “that Harman told witness that if he would take a share of two hundred dollars in the horse mentioned in evidence, he would give him a check for two 'hundred dollars, and did give him a check for two hundred dollare, for which he (Ash) got the money, and then offered to prove by said James A. Ash that at the time of this transaction Hannan told said witness that the plaintiff (Kelso) had sent him there to sell the horse, and proffered to follow it up by the evidence of Mr. Hendershot that the plaintiff (Kelso) told him (Hendershot) that he (Kelso) had given two hundred dollars to Ash to effect the sale.”

The Court struck out the testimony objected to,.to wit, “that Hannan told witness that the reason Harman came to witness was that Mr. Kelso recommended him.”

This ruling constitutes the second exception.

The testimony stricken out was clearly inadmissible unless it was shown that Harman was an agent of Kelso. This agency could not be shown by the mere declarations of Harman.

In National Mechanics Bank of Baltimore v. National Bank of Baltimore, 36 Md. 20, the Court said: “Declarations of a broker or agent are not per se evidence of agency; but when evidence of facts in pais tending to show the relation of principal and agent existing has been- offered directly or circumstantially, it is then the province of the jury to determine whether there is such proof of agency as to make the declarations of the supposed agent binding on the principal. * * * In Rosenstock v. Tormey, 36 Md. 182, this Court alluding to the practice of allowing parties to introduce evidence which was irrelevant per se, by assurance of counsel it would be followed up by evidence that would make it relevant, remarked: “We are not aware of any decision that has applied the rule to the case where declarations or acts of agents are offered for the purpose of binding principals. On the contrary, it is plainly said in Marshall v. Haney, 4 Md. 511, that the declarations of an agent are not admissible to bind the principal under any circumstances until the agency is first clearly established, and the language of the Court in Atwell v. Miller, 11 Md. 359, is to the same effect.”

There was no -proof to show that Harman was the agent of the plaintiff and the testimony was properly stricken out. Furthermore, Mr. Hendershot, who was subsequently called by the plaintiff, did not support the offer made with respect to the testimony stricken out. We find no error in this ruling.

This brings us to the consideration of the action of the Court in rejecting the defendant’s seventh prayer, which was as follows: “The jury are instructed that in considering the question of notice it is not necessary that the plaintiff have knowledge or notice of any particular fraud, but that it is sufficient that the plaintiff have notice that there'was fraud in the obtention of the note sued on by the payee therein from the makers thereof.” Every holder of a negotiable promissory note is deemed a prima facie holder in due course; but when it is shown that the title of any person who has negotiated the instrument was defective, the burden is on the holder to prove that he, or some person under whom he claims, acquired the title as a holder in due course. (Code Article '13, section 78.

In Cover v. Myers, 75 Md. 419, the Court said: “Where a negotiable instrument is originally infected with fraud, invalidity, or illegality the title of the original holder being destroyed, tbe title of every subsequent bolder which reposes on that foundation, and on no other, falls with it. But if any subsequent bolder takes tbe instrument in good faitb, and for value, before maturity, be is entitled to recover on it;” and section 75, Article 13, of the Code provides that “to constitute notice of an infirmity in an instrument or defect in tbe title of the person negotiating tbe same, tbe person to whom it is negotiated must have bad actual knowledge of tbe infirmity or defect, or knowledge of such facts that bis action in taking tbe instrument amounted to bad faitb.”

Tbe defendant offered evidence tending to sbow that tbe signature of some of tbe makers of tbe note were obtained by tbe fraud of H. P. Reynolds & Co. It was then incumbent upon tbe plaintiff to sbow that be took tbe note in good faitb, for value, and before maturity, and without any actual knowledge of any infirmity or defect in tbe instrument. He offered evidence tending to sbow that be took the note under these circumstances, and tbe jury, under tbe instructions of tbe Court, accepted as true bis evidence on these points. Tbe Court granted six prayers on behalf of tbe defendant. An inspection of these prayers, which will be set out in tbe report of tbe case, will sbow that tbe case of tbe defendant was submitted to tbe jury as favorably and as fairly as be bad a right to expect upon all tbe issues raised by tbe pleadings.

Tbe question of notice presented by tbe defendant’s seventh prayer was fully covered by tbe granted prayers of tbe defendant, particularly by tbe fifth prayer, in which the jury were told that they were at liberty “to consider all tbe facts and circumstances given in evidence in this case in determining whether tbe plaintiff at tbe time be purchased tbe note sued on bought tbe same in good faitb and without notice of fraud in obtaining tbe execution of said note.”

Finding no reversible error in any-of the rulings, the judgment will be affirmed.

Judgment affirmed, with costs to the appellee.