Auerbach v. Peetsch — 39 N.Y. St. Rep. 211

Majority

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Simon Auerbach et al., Resp’ts, v. Henry C. L. Peetsch et al., App’lts.

(City Court of New York, General Term,

Filed June 19, 1891.)

Headnote

'Trial—Appeal.

When both plaintiff and defendant request the court to direct a verdict the trial judge becomes the trier of both the law and facts and his judgment as to disputed questions of fact will not be disturbed on appeal.

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Appeal from judgment entered upon verdict directed by the-court for the plaintiff.

Meyer Auerbach, for resp’ts; Edward W. S. Johnston, for app’lts.

—This action was upon a promissory note-made by defendants to the order of one Moonelis, endorsed and delivered by him to plaintiff for full value before maturity. The defendants’ answer alleged that the note was not delivered toMoonelis or to any one else for value. The plaintiffs put the note in evidence and one of them testified that they received it. from Moonelis before maturity in payment of two of Moonelis’ notes held by them which together equalled the amount of the note-in suit, and that thereupon they surrendered to Moonelis his two-aforesaid notes. These transactions, if truthfully stated, made the plaintiffs, under the New York law, bona fida holders for value. To substantiate the defense the defendant Peetsch testified as follows :

“The signature to this note is my signature; that note was delivered to me by Mr. Moonelis and after that delivery it was. returned ; two days afterwards he came to my office and told me that the bank would not discount such a big note; that they were tight of money, and to make two small notes in place of it; this, note was returned to me and I never again delivered it to him or-to anybody else; he came with that note to my office and wanted two notes in place of it; after that note of $1,351.20, dated September 3, 1890, being plaintiffs’ Exhibit ‘A.,’ was returned to me by Mr. Moonelis, I never delivered it to him or to anybody else; I say that I never parted with that paper after it was returned to me ; I know how it left my possession; I never saw it afterwards in the hands of Mr. Moonelis or in anybody’s else hands; I did not see it after it left my possession; it was left on the table and I was called out and when I came back the note was gone and when I asked him afterwards about the note he told me he had the note destroyed; that lie unintentionally took it along.”

This is all of the evidence offered by the defendants except as-to the original consideration for the note.

At the close of the testimony in the caséis found the following r “ Defendants’ counsel asks the court 'tó direct a verdict in favor of the defendants.” “ Motion denied. Exception.” And “ plaintiffs’ counsel then asked the court 'to direct a verdict in favor of plaintiffs. The court thereupon directed a verdict in favor of the plaintiffs for $1,359.30. The defendants, excepted. ” This exception can be of no avail to the defendants' on appeal, for the reason that when both parties requested the court to direct a verdict, they thereby conferred upon the judge all "of the authority over the questions of fact which the jury would have otherwise had. And unless some merit can be found in the defendants’.; other exceptions, they cannot prevail. But these other exceptions are directed against the rulings of the court excluding evidence^ offered by defendants tending to show what was the original consideration! for the note. These rulings, however, seem' proper,1 ásfthe defensa was that the note, some time after making and delivery; and.aiter:

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its redelivery to the maker in exchange for two other notes, was, say, stolen from the maker. Here the substance of the defense is the felonious taking of the note from the maker by its payee; and if this is a good defense against a bona fide holder for full value, it would be such even though the note had been originally given by the maker for full value; and as a good defense cannot be made better, of what consequence can it be that the note was originally given without any consideration; and moreover, if it .had been originally given by the maker without consideration, it would be, except for this intervening defense of felonious taking, good in the hands of a bona fide purchaser; and the court, in the exercise of the functions of a jury, has held both that the plaintiff is a bona fide purchaser, and that the note was not delivered, redelivered and retaken, as testified to by a party, to the action.

Such determination was justified by the evidence, and the judgment is affirmed, with costs.

ITewburg-er, J., concurs.

—This action was upon a promissory note made by the defendant Peetsch to the order of defendant Moonelis, bearing date September 3, 1890, payable four months after date,

• and endorsed and delivered by him to the plaintiffs, for full value before, maturity.

The defendant Peetsch appeared, and in his answer admits the making of the note, and alleges:

First. The said pote “was not delivered by this defendant Peetsch to the defendant Moonelis, or to any other person or persons, nor did. this defendant ever receive any value from the defendant. Moonelis, or from any other person or persons, of all of which the plaintiffs had notice.”

Second. “ This defendant alleges, upon information and belief, that the plaintiffs did not purchase said note for value in good faith from the defendant Moonelis, nor did they part with any value therefor, and that they are not the lawful owners or holders thereof as against this defendant.”

The plaintiff thereupon put in evidence the note in question, and Meyer Auerbach, one of the plaintiffs, testified that plaintiff received the note from Moonelis, before maturity, in payment of two notes of Moonelis held by them, which- became due September 25th and October 24th, respectively, which, together with the sum of seventy dollars paid by Moonelis on account of one of said notes, and together with the interest on the two notes, made up the amount of the note in suit, and that plaintiff at the same time surrendered and returned, the two notes to the defendant Moonelis. That, at the time of the delivery of-the note, plaintiffs had no knowledge that the note had been diverted by the defendant Moonelis, or wrongfully taken by him. This transaction if truthfully stated made the plaintiffs, under the laws of this state, bona fide holders' for value. Phoenix Insurance Co. v. Church, 81 N. Y., 225 ; Nickerson v. Ruger, 84 id., 676; Grocers' Bank v. Penfield, 69 id., 505.

To sustain his defense, Peetsch testified as follows: “The

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signature to this note is my signature. That note was delivered by me to Mr. Moonelis, and after that delivery it was returned. Ten days after that he came to my office and told me that the bank would not discount such a big rióte ; that they were tight of money and to give him two small notes in place of it. This note was retained by me and I never delivered it to him or to anybody else. He came with that note to my office and wanted two notes in place of it. After that note of $1,351.20, dated September 3, 1890, being plaintiff’s exhibit A, was returned to me by Mr. Moonelis, I never delivered it to him or to anybody else. Again I say that I never parted with that paper after it was returned to me. I know how it left my possession. I never saw it afterwards in the hands of Mr. Moonelis or anybody else’s hands. I did not see it after it left my possession. It was left on the table, and I was called out, and when I came back the note was gone, and when I asked him afterwards about the note he told me he had the note destroyed; that he unintentionally took it along. ” No other testimony was offered except as to the consideration of the original note surrendered.

Defendant’s counsel thereupon asked the court to direct a verdict in favor of the defendant, which motion was denied. Plaintiffs’ counsel then asked the court to direct a verdict in favor of the plaintiffs. The court thereupon directed a verdict in favor of the plaintiffs for $1,359.30, and the defendant excepted. This exception, however, can be of no avail to the defendant on appeal, for the reason that where both parties request the court to direct a verdict, they themselves conferred upon the trial judge all of the authority over the questions of fact which the jury would have otherwise had, including the power to discredit the testimony of either party, unless Peetsch’s testimony was corroborated by other testimony, and the court below was not bound, as a matter of law, to credit the statement of the defendant, an interested party, and given in his own behalf, though not contradicted by any other witness. Kearney v. The Mayor, etc., 92 N. Y., 621 ; Elwood v. Western Union Telegraph Co., 45 id., 553 ; Sipple v. The State, 99 id., 290.

There was no request on the part of the defendant to submit any question of fact to the jury. There was no evidence offered on the part of the defendant to contradict the testimony of the plaintiff Auerbach, as to the transaction between himself and Moonelis, when plaintiff received the note upon the surrender of the original note.

The trial justice having directed a verdict, there was no error under the circumstances.

In Stratford v. Jones, 97 N. Y., 589 , Rapallo, J., says: “We do not think that the testimony conclusively proved the fraud alleged, so as to entitle the plaintiff to a direction of a verdict in his favor. At most, the evidence raises a question of fact which might have been submitted to the jury. No request to that effect was made, but both parties requested the court to direct a verdict.

“ Under these circumstances it has often been held that the

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parties must be deemed to have submitted the questions of fact, if any, to the decision of the court, and waived the right to go to the jury. The decision of the court, therefore, stands in the place of a verdict of the jury, the evidence being such that a verdict for the defendants could have been ‘sustained. The direction to find such a verdict was no error under the circumstances.” See, also, Provost v. McEncroe, 102 N. Y., 650 ; Kirtz v. Peck, 113 id., 225; 22 N. Y. State Rep., 733.

In Royce v. Watrous, 7 Daly, 88 , where a question arose as to the direction of a verdict, Daly, Oh. J., says: “A judge having ordered a verdict for the plaintiff he must be regarded as ruling that the plaintiff was entitled to recover even upon the case as presented by the defendants’ testimony, and in view of any inference which a jury might legitimately draw from the defendants’ testimony from the whole of the evidence in the case.”

Unless some merit can be found in the other exceptions taken by defendants, they cannot avail, and we shall, therefore, consider the exceptions in the order taken.

Defendants’ counsel, at folió 16 of case, “Asked the court for the affirmative of the issue before the jury. Motion denied. Exception.”

The plaintiff before he could recover must show, as alleged in his complaint, that he was the lawful owner and holder of the note.

The answer admits the making of the note, but alleges that the same was not delivered by the defendant Peetsch to the defendant Moonelis, or to any other person or persons, and that defendant never received any value therefor from the defendant Moonelis, or from any other person or persons, of all of which the plaintiffs had notice. Also that the plaintiffs did not purchase said note for value in good faith, from the defendant Moonelis, and did not part with any value therefor, and that plaintiffs are not the lawful owners or holders thereof.

It became necessary, therefore, for plaintiffs to produce the note to show delivery by defendant Peetsch to defendant Moonelis, from whom plaintiff received the note, and also to show that he had no knowledge or notice that the note had been diverted by Moonelis or wrongfully taken by him. Vosburgh v. Diefendorf, 119 N. Y., 365 ; 29 N. Y. State Rep., 448.

There is no merit, therefore, in this exception.

At folios 17 and 19, defendants’ counsel asked defendant Peetsch, a witness:

“Q Under what circumstances was this note made? Objected to, that no such -defense was offered or pleaded.”

“The Court: The only defense in the case under the pleadings is the non-delivery of the note. Objection sustained. Exception.”

There was no error, we think, in this ruling. There are no merits in the fifth exception taken at folios 19, 20 and 25.

The judgment appealed from must, therefore, be affirmed, with costs to the respondent