p. 52Frederick P. James v. Alexander Chalmers.Headnote
The presumption of law that the holder of a promissory note is its owner, is not repelled by showing that it came into his hands after it was due.Proof of a valuable consideration js only necessary to be made when a defence is set up, which, unless the plaintiff was a purchaser for value and without notice, would conclude him.
In all other cases a plaintiff who sues as an endorsee, and proves his title as such, is to be deemed the real party in interest under § 111 of the Code.
These points assented to by all the judges. Brisbane v. Pratt ( 4 Denio, 63 ) is not to be construed as sanctioning an opposite doctrine.
Order at special term, denying a re-hearing, affirmed with costs.
(Before Dues and Campbeli, J.J.)
This was an appeal from an order made by Mr. Justice Paine at special term, denying a motion on the part of the defendant for a re-hearing.
The action was brought by the plaintiff, as endorsee of a promissory note, against the defendant as maker, and the referee (M. Ulshoeffer, Esq.) had reported that the plaintiff was entitled to recover the full amount of the note, with interest. It appeared from the report, that the note was given to Adams & •Brownell, and was endorsed by them ; that before it was due they transferred it, for value, to one Lucius S. Beardsly, who sold it, after its maturity, to one Wm. M. Parks, from whose hands it passed into those of the plaintiff, but it did not appear that any "consideration passed from the plaintiff to Parks. The title of the plaintiff w;as put at issue by the pleadings.
J. Aitken, for the defendant,
insisted that as it did not appear - that the plaintiff had given any value for the note, and it was
p. 53certain that he received it after it was due, it was a presumption of law that he was prosecuting the suit for the benefit of Parks* and the court was therefore bound to say that he was not the real party in interest, and under the Code, § 111, had no right to maintain the action. He relied upon the case of Brisbane v. Pratt ( 4 Denio, 63 ), in which Mr. Justice Jewett said that the holder of a promissory note, under the like circumstances, is to be deemed a mere trustee, as a controlling authority.W. C. Betts, for the plaintiff,
was stopped by the court,There is no exception from the rule, that the holder of a promissory note sufficiently proves his title as owner by the production of the note, and proof of the signatures of the maker and endorser. Whether the note came into his hands before or after it was due, he is not required to show that it was transferred to him, for value, unless a defence is set up that would otherwise conclude him. Where no defence is interposed, even his admission that he paid no value, would not destroy his title as owner. The mere delivery of a note, if not accompanied with a trust, would be sufficient to vest an absolute title, since, unexplained, it would be evidence of a gift. If the plaintiff is a trustee for Parks, the proof rested upon the defendant.
The observations of Mr. Justice Jewett, in Brisbane v. Pratt, must be understood in reference to the particular circumstances of that case, in which a defence was set up that could only be met by proof that the plaintiff was a bonâ fide holder for value. Whether in that case the declarations of a former holder were properly admitted in evidence to impeach the title which he had passed, is a question that we are not now called upon to consider.
Although we can see no reason for doubting that the order appealed from must be affirmed, we shall suspend our judgment until we have consulted our brethren, and if the question shall be regarded by them as at all doubtful, the case shall be called again upon an early day.
Upon consultation, the judges were all of opinion that a further argument was unnecessary, and that the order at special' term should be affirmed.