Weaver v. Farrington — 58 N.Y. St. Rep. 58

Majority

p. 58

William H. Weaver et al., Resp’ts, v. Joseph T. Farrington et al., App’lts.

(New York Common Pleas, General Term,

Filed March 15, 1894.)

Headnote

Bills and notes—Holder for value.

A transferee of a negotiable note, taken before maturity as collateral security for a precedent debt, may, in the absence of diversion and fraud, enforce it against an accommodation maker and endorser.

Appeal by defendant from a judgment of the general term of the city court, affirming a judgment for plaintiff, entered upon a verdict directed by the court. The action was upon a promissory note made by George Blair and endorsed by Joseph T. Farrington.

Samuel 0. Mount, for app’lts; Nelson S. Carr, for resp’ts.

The facts which the appellant Farrington, the endorser, sets up in his answer, the right of the plaintiff to recover; for, while alleging that he endorsed the note for the accommodation of Blair, he avers substantially" that the latter transferred it to the plaintiff as collateral security for an existing indebtedness of Blair, and nowhere alleges that there was either fraud or diversion in such transfer.

In the case of The Mechanics and Traders' Bank v. Livingston, 55 St. Rep. 394 ; 26 N. Y. Supp. 25 , we held that the transferee of a negotiable note, taken before maturity as collateral security for a precedent debt is a holder for value and he may enforce it against the accommodation maker and endorser if there be no diversion or other fraud in its acquisition. None of the defenses which were attempted to be proved on the trial were set up in the answer and were therefore properly excluded.

The judgment must be affirmed.