Albert v. Hoffman — 64 Misc. 87

Majority

p. 87

Mary Albert, Respondent, v. William Hoffman, Hyman Feinberg and “Max” Feinberg, Copartners Doing Business under the Firm Name of H. Feinberg & Son, Defendants, William Hoffman, Appellant.

(Supreme Court, Appellate Term,

June, 1909.)

Headnote

Negotiable instruments — Bona fide holders — What constitutes: y0_ tice of equities generally— Postdating as raising suspicion; Parting with value — Necessity of parting with value — What constitutes value.

To prove the holder of a negotiable instrument a holder for value, it is not necessary, as in the case of a chattel, to show that he has given some consideration other than the discharge of a debt that revives when the consideration for its discharge fails, or a consideration that cannot be actually restored by operation of law, but leaves the purchaser in a changed condition, so that he may lose something besides his bargain.

The holder of a bank check is not put upon inquiry merely because the check is negotiated prior to the day of its date.

Appeal by the defendant William Hoffman from a judgment in favor of the plaintiff, rendered in the Municipal

p. 88

Court of the city of Hew-York, second district, borough of Manhattan.

George H. Epstein, for appellant.

Harold M. Phillips, for respondent.

The plaintiff, in her complaint, declares on a check made'by defendant Hoffman, directing the East ¡River Rational, Bank to pay to the order of H. Feinberg & Son, on Rovember 10, 1908, the sum of $364, and that the defendants H. Feinberg & Son duly indorsed and delivered same to the plaintiff for value, but that payment was stopped by the maker before presentation, and no part, although duly demanded, has been paid. The defendant Hoffman denies that he delivered the same for value to the payee of the check, and also denies that the plaintiff became a holder in due course and for value, defending separately on the ground that the check was postdated, that no consideration passed therefor between the maker and the payee, and that plaintiff has come into possession thereof, without having given any valuable consideration therefor, and with full knowledge on her part of the facts and circumstances attending the making and delivery of the check to the payee therein named.

Under section 31 of the Regotiable Instruments Law, then in force, “ the instrument,” a negotiable instrument, as was the check in question, as defined by section 2 of the same law, “ is not invalid for the reason only that it is antedated or postdated, provided this is not done for an illegal or fraudulent purpose,” and the'plaintiff, as indorsee, was not put upon inquiry merely because of the negotiation of the check prior to the day of its date. Brewster v. McCardell, 8 Wend. 478 . The plaintiff herein became a holder for value, having received the check in payment of a past loan. True it is in this State, as applied to chattels, valuable consideration “ means something more than the discharge of a debt, that revives when the consideration for its discharge fails It means the parting with some value that cannot be

p. 89

actually restored by operation of law, leaving the purchaser in a changed condition, so that he may lose something besides his bargain. Barnard v. Campbell, 58 N. Y. 73 ; Stevens v. Brennan, 79 id. 254, 258; Hyde v. Ellery, 18 Md. 496 , 501; McGraw v. Henry, 83 Mich. 442 ; George v. Kimball, 24 Pick. 234 , 240.” Hurd v. Bickford, 85 Maine, 217, 220. While true as regards chattels, negotiable paper is an exception (Saltus v. Everett, 20 Wend. 267 , 277), it having been held that the extinguishment of an antecedent debt in consideration of the transfer of negotiable paper constitutes the transferee a holder for value within the rule cutting off prior equities. Mayer v. Heidelbach, 123 N. Y. 332 , 339. Such was the plaintiff herein and so, according to law, has the trial justice determined by rendering judgment in her favor; and so determining he has found her to be a transferee in good faith, as also appears from the memorandum of his decision, annexed to the return, denying the motion of defendant Hoffman for a new trial; and from the evidence adduced this court may not otherwise conclude.

The judgment will, therefore, be affirmed.

IGildebsleeve and Seabuby, JJ., concur.

Judgment affirmed, with costs.

Cases cited

Brewster v. McCardell 8 Wend. 478 N.Y. Sup. Ct. p. 88
Barnard v. Campbell 58 N. Y. 73 N.Y. 1874-06-16 p. 89
Saltus & Saltus v. Everett 20 Wend. 267 N.Y. Sup. Ct. at 277 p. 89
Mayer v. Heidelbach 123 N. Y. 332 N.Y. 1890-10-21 at 339 p. 89