Fealy v. Bull — 24 N.Y.S. 988

Majority

p. 988

FEALY v. BULL.

(Supreme Court, General Term, Fourth Department.

September, 1893.)

Headnote

Check—Action by Indorsee—Bona Fide Purchaser—Evidence.

In an action by the indorsee of a check against the drawer, who stopped payment, it appeared that plaintiff, who was the payee’s sister-in-law, had been living with the latter’s family some months before the check was drawn, on a farm which belonged to one H.; that, as between the payee and BÚ, the money for which the check was given belonged to the latter, and that plaintiff knew the check was given for butter produced on the farm, at a time when the payee was sick, and the family greatly in need of money. H. testified that before the butter was sold he told plaintiff's sister, in her presence, that the check for the price must be made payable to him, and that the day after it was drawn he demanded it of such sister. Plaintiff testified that she purchased the check three or four days after it was given; that she heard H. ask for it, but could not tell the date, nor remember what was said; and that her memory was good, and she did not remember that H. told her sister that the check must be made payable to him, but would not say it did not occur. Held, that a finding by the jury that plaintiff did not have knowledge of circumstances that ought to have put her on inquiry as to the rightful ownership of the check by the payee was against the weight of the evidence.

Appeal from circuit court, Cortland county.

Action by Joanna Fealy against John Bull to recover the amount of a check drawn by defendant on a certain bank, payable to the

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order of Patrick McCarthy, and indorsed by the latter to plaintiff. From a judgment entered on the verdict of a jury in favor of plaintiff, and from an order denying his motion for a new trial, made on a case and exceptions, and the judgment entered thereon, defendant appeals.

Reversed.

"In the answer it is alleged that the consideration of the check was property that belonged to William W. Hare, sold to defendant by the agent of Hare, and that Hare is the owner, and lawfully entitled to the check and its proceeds, and that defendant has paid Hare; that plaintiff is not the owner of the check, and that she received it with full knowledge that McCarthy was not the owner, and had no right to it, or its proceeds.

Argued before'HARDIN, P. J. and MERWIH and PARKER, JJ.

M. Van Cleef and J. H. Palmer, for appellant.

James Dougherty and J. E. Eggleston, for respondent.

We find no exceptions in this case upon which a reversal can be properly based. The objection that plaintiff, by reason of the payee’s death, could not testify to the transaction between her and the payee at the time of the delivery to her of the check, under section 829 of the Code, came too late, even if tenable at all. The defendant claimed, not under McCarthy, but under Hare. The question to defendant, “How did you first learn that the plaintiff claimed to own this check?” was properly excluded. At the close ol the case a nonsuit was asked for on certain specific grounds, which related to the effect of certain portions of the evidence. The motion was properly denied. Ho point is made as to the charge.

The main issue litigated at the trial was whether the plaintiff was the owner in good faith of the check. It is quite clear, and it does not seem to be denied, that as between Hare and McCarthy, Hare was the owner, or entitled to receive the check. McCarthy was the tenant upon the farm, and the check was given for butter produced upon the farm. By the agreement between Hare and McCarthy the title of all property raised or produced was to be and remain in Hare until the fulfillment of the contract. At the time the check was given the contract had not been fulfilled. The court charged that if the plaintiff, at or before the time she purchased the check, had knowledge of circumstances which ought to have put her upon inquiry as to the rightful ownership of the check by Mr. McCarthy, she could not recover. The jury, in effect, found that she was a purchaser in good faith, for full value, and without knbwledge of circumstances which ought to have put her upon inquiry. The defendant claims that this finding is against the evidence. The plaintiff was the sister of the wife of the tenant, Mr. McCarthy, and she lived in his family from the June previous to the giving of the check. Mr. McCarthy was sick all the summer, and' died in December following. The plaintiff knew that- Mr. Hare owned the farm, and that the check was given for butter pro

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duced upon it. She testifies that she purchased the check three or four days after it was given. This, being before it was presented for payment, does not necessarily subject the purchaser to the equities existing.against it as dishonored paper, but it is a circumstance to be considered in determining whether the purchaser acted in good faith and with due caution. 2 Pars. Notes & B. 271. The butter was sold, and the check was dated, November 23d. On the 24th Mr. Hare was at the house of Mr. McCarthy, and demandLed the check of Mrs. McCarthy. The plaintiff testifies that she heard Mr. Hare ask for the check, but that she cannot tell the date, and does not remember what was said. Mrs.- McCarthy, a witness for plaintiff, testifies that at the request of her sister she presented the check at the bank for payment, and that this was three or four days or a week after it was given. Payment was refused by the bank, as the defendant had previously, at the request of Hare, stopped payment on it. Mr. Hare testifies that a few days before the butter was taken away he was at the house, and said to Mrs. McCarthy, in the presence of plaintiff, that the check for the price must be payable to him. As to this the plaintiff testifies: “1 do not remember that Mr. Hare told Mrs. McCarthy that the check should be made payable to him, nor anything of the kind. I will not say it did not occur, but I don’t remember. My memory is good.” The McCarthy family were in need of money, as the plaintiff knew. She presximptively knew that if the check was good they coxild draw the money on it immediately, and that if the transaction was honest there was no reason whatever for their waiting a single day, or for calling on plaintiff to advance the money. The plaintiff woxild receive no benefit, if not taken for a prior debt; and, if it was, that would be fatal to her position. The fact that they‘did wait and did call on one in the position of plaintiff to raise the money, woxild naturally lead one, though not very wise or prudent, to think there was some trouble about it. The bank was some miles from where they lived, but there was no reason why Mrs. McCarthy couldn’t go and present it, as she actually did do it within two or three days after. The plaintiff was at some inconvenience in raising the money, and her evidence leaves it a little uncertain as to when she obtained it. The whole transaction was unusual. A careful consideration of the evidence leads us to the conclusion that the verdict, as it involves the proposition that the plaintiff did not have knowledge of circumstances that ought to have put her upon inquiry as to the rightful ownership of the check by Mr. McCarthy, is against the weight of the evidence. Upon this ground a new trial shoxild be granted upon the usual terms in such cases.

Judgments and order reversed, and a new trial ordered upon the payment by the appellant of the costs of the trial, and without costs of this appeal to either party. In case such costs are not paid within 20 days, then judgments and order affirmed, with costs. All concur.