Old Colony Trust Co. v. Stumpel — 247 N.Y. 538

Majority

p. 538

Old Colony Trust Company, Appellant, v. Gustav Stumpel, Respondent.

Headnote

Bills, notes and checks — negotiable instruments — note bearing indorse ment that it is subject to terms of another unattached agreement not negotiable.

Old Colony Trust Co. v. Stumpel, 219 App. Div. 771 , affirmed.

(Argued December 12, 1927;

decided January 10, 1928.)

Appeal from a judgment of the Appellate Division of the Supreme Court in the first judicial department, entered February 28, 1927, affirming a judgment in favor of defendant entered upon a verdict directed by the court. The action was to recover upon promissory notes

p. 539

made by defendant to a corporation and by it delivered to plaintiff as security for a loan. Each note bore upon its face an indorsement as follows: “This note is given in accordance with the terms of a conditional sales agreement between the payee and the maker hereof.” On the back of each note in addition to other matter was indorsed: “ The within notes is subject to the terms of a conditional sales agreement executed by the maker thereof upon this date.”

Edward H. Blanc, George S. Mittendorf and Ramsey Clayton for appellant.

Raymond Gitlin and William Walzer for respondent.

Judgment affirmed, with costs, upon the ground that the provision in the note to the effect that it is subject to the terms of another agreement not attached thereto makes the promise of payment one that is not absolute on its face and thus destroys negotiability.

Concur: Cardozo, Ch. J., Pound, Crane, Andrews, Lehman, Kellogg and O’Brien, JJ.