author: By the Court. Duer, J.

text:
    John Kuhlman v. John Orser, Sheriff.
    A sheriff who, in an action for the delivery of personal property, returns that he had taken the property in question, from the defendant, and delivered it to the plaintiff, is estopped from denying the truth of the facts, that the return asserts, or necessarily implies.
    He is not, therefore, permitted to allege, that the property was not in the possession of the defendant, but was in his own custody, by force of a levy under an attachment previously issued.
    .This return is conclusive proof that, in his own judgment, the property was not bound by the attachment, and operates to release it from any lien that a prior levy might have created.
    The notice, required to be given in the execution of a warrant of attachment, under § 236 of the Code, must describe, particularly, the property levied on, so as to enable the holder to identify it, and deliver it to the sheriff, when his own claims are satisfied.
    A notice referring, in general terms, to the property, as belonging to the debtor in the attachment, is insufficient and void.
    As against a bond fide purchaser, personal property is only bound by an attachment from the time of an actual levy.

      In proceeding under an attachment, the sheriff acts as much at his own peril, as in proceeding under an execution.
    Hence, he renders himself liable, as a trespasser, by taking and removing the goods of a person not named as a debtor in the attachment.
    (Before Duer, Campbell and Hoffman, J.J.)
    Heard, December, 1855;
    decided, January, 1856.
    Motion, on the part of the plaintiff, for judgment, on a verdict in Ms favor, taken subject to the opinion of the court, at General Term.
    The action was brought for the delivery of the possession of certain goods and merchandise, consisting of wines, Cologne water, and linen pocket-handkercMefs, valued in the complaint at $1,000, wMch the complaint alleged that the defendant had wrongfully taken, and wrongfully detained.
    The answer denied the wrongful taking and detainer, and set up, as a justification, that the defendant, acting as sheriff of the city and county of Few York, under two certain attachments, (of which copies were annexed to the answer,) directed to him, as such sheriff, against the property of ■— Pfeiffer, —'Yon Kamp, and one C. F. Herx, composing the firm of Pfeiffer, Yon Kamp & Co., in the month of August, 1853, had attached and levied on the goods and chattels mentioned in the complaint; and averred, that the defendants in the attachment, or some, or one of them, were or was the owner of the said goods and chattels, or had a leviable interest therein.
    The cause was tried, upon the issues made by the pleadings, before Campbell, Justice, and a jury, in December, 1854.
    Upon the trial, the counsel for the plaintiff gave, in evidence, a judgment-roll, in an action by the plaintiff, against Thomas Turner and Louis Schmulling, for the delivery of the possession of the goods and chattels now in question. And upon the complaint, forming a part of the roll, there was endorsed the following certificate and return, wMch, it was proved, was signed by the defendant:—
    “ By virtue of the within requirement, to me directed and delivered, I have caused a portion of .the within mentioned goods and chattels to be taken, to wit: twenty-five boxes Rhenish wine, one box do., four boxes eau de Cologne, nine packages of linen; and have summoned the within named defendant, and served upon him a copy of the undertaking, given by the plaintiff in the within action, and also a copy of the within requirement and affidavits, by which the property was taken; and that, no notice of exception being served upon me,-1 therefore delivered the property, taken by me, to the plaintiff, as within I am commanded. I further certify, that the balance of the property has been eloigned, removed or concealed, so that I could not take the same.
    “Dated Hew York, April 6, 1854.
    “ John" Obseb, Sheriff."
    The counsel for the defendant objected to the admissibility of this evidence. The objection was overruled, and the counsel excepted.
    Selah, a deputy of the defendant, then proved, that, as such deputy, and by virtue of the summons, complaint, and affidavit, in the action against Turner & Schmulling, he had taken from their possession the boxes of wine, &c., mentioned in the sheriff’s certificate, and had removed the same to the store of one Hash, an auctioneer, in Broadway; that he gave to the plaintiff an order upon Hash, which was accepted, for the delivery of the goods; and that the. plaintiff had paid to him twelve dollars, for his fees, and also four dollars to Hash, for storage and insurance. These payments were made on the 10th of February, 1854.
    C-rombie, another deputy of the defendant, then proved, that, on the same 10th of February, having been informed that the plaintiff had obtained an order for the goods, hé went to the store of Hash, and forbade and prevented the delivery of the same to the plaintiff; and that he (the witness) then claimed and took possession of the goods, under the two attachments referred to in the defendant’s answer."
    The counsel for the defendant then offered to prove, by the same witness, that, under these attachments, he had attached the property in question, in August, 1858, previous to the commencement of the plaintiff’s action against Turner & Schmulling.
    The counsel for the plaintiff objected to this testimony, upon the ground, that the defendant was estopped by Ms certificate and return from justifying the taking of the property from the possession of the plaintiff, by a previous levy, under the attachments.
    The objection was overruled, and the counsel excepted.

      The witness then testified, that the attachments were delivered to him, for service, in August, 1853; that certain boxes and other property, which he was informed belonged to Pfeiffer Von Kamp & Oo., and of which the marks had been given to him, were in the public store, and, as the duties had not then been paid, he did not then take possession of it, but made a levy, by serving copies of the attachment, with notice, on the collector, and on Schmulling, of the firm of Turner & Schmulling, to whom he understood the property was consigned; that he next heard of the property at Nash’s store, and that the property, of which he there stopped the delivery and claimed to hold, under the attachments, he believed to be the same that he had before attached, but that he had made no inventory of it.
    The attachments were then read in evidence. Each was dated 11th August, 1853, and, after reciting that the application was for an attachment against the property of Pfeiffer, Von Kamp, and C. F. Herx, composing the firm of Pfeiffer, Von Kamp & Co., and for a debt due from them as partners, the first, directed the sheriff to attach, and safely keep all the property of Pfeiffer, Von Kamp & Co., or each of them, within his county; the second, contained the same direction, omitting the words “ or each of them.”
    The testimony on the part of the plaintiff being closed, the counsel for the defendant moved for a dismissal of the complaint, upon the ground, that the plaintiff had not shown any right or property in the goods whatever, and that, as they had been attached, they were in the custody of the law, and the rights of the plaintiff, if any he had, were subject to the rights and special property of the sheriff.
    The motion was denied, and the counsel excepted.
    The defendant then called, as a witness, Franz T. Herx, who, upon his examination and cross-examination, proved, that the goods in question arrived here in the ship Eliza; that the invoice was in his name, and the bill of lading to his order, and that he owned the goods, and had paid all the charges thereon, including the duties, and that he had placed them in the hands of Turner, Schmulling & Co., to sell, on commission, upon his account.
    He was then asked, by the counsel for the plaintiff, whether he was a member of the firm of Pfeiffer, Von Kamp & Co. The counsel for the defendant objected to the question, as irrelevant. The objection was overruled, and the counsel excepted.
    The witness then swore, that he was not, and never had been a member of the firm of Pfeiffer, Yon Kamp & Co.; that he had bought the goods himself, and with his own funds, and that, after his arrival here, finding it difficult to get money from Turner, Schmulling & Co., he had sold the goods to the plaintiff, who had paid him, partly in cash, and partly in his notes. The witness also proved the value of the property, in respect to which there was no contradictory evidence.
    The jury, under the direction of the court, found a verdict for the plaintiff, and assessed the value of the goods at $919, and the damages of the plaintiff, for their detention, at $53.61. The verdict was taken,• subject to the opinion of the court, upon a case, to be heard, in the first instance, at General Term, with liberty to the court to dismiss the complaint, and order judgment for the defendant.

      J. Sutherland, for the plaintiff.
    The plaintiff is entitled to judgment, upon the verdict; the justification set up, under the attachment, having wholly failed. There was no legal proof of a levy, under the attachments, before the commencement of the action against Turner & Schmulling; and, admitting that the goods were attached at Nash’s store, when about to be delivered to the plaintiff, the mere production of the attachments, and proof of a levy under them, amounted to nothing, without proof of the other facts set up in the answer, namely, that the goods were the property of Pfeiffer, Yon Kamp & Co., or of one of the firm, and that they were indebted to the plaintiffs in the attachments, as alleged in the answer; and of these facts, the affidavits, upon which the attachments were founded, and which were read in evidence upon the trial, were certainly not evidence. It had, moreover, been proved, conclusively, by Franz T. Herx, whom the defendant himself had called to testify, that the goods were his individual property; that he never was a member of the firm of Pfeiffer, Yon Kamp & Co., and was never indebted to the plaintiffs in the attachments. This witness had, in fact, disproved the whole of the defendant’s pretended justification.

      A. J. Vanderpoel, for the defendant.
    The verdict ought to be set aside, and a judgment, dismissing the complaint, be entered for the defendant. The defendant was entitled to the possession of the goods, by virtue of the levy, under the attachments made by his deputy, in August, 1853. As the goods were then in possession of the government, under their liability for duties, they could not be manually seized by the sheriff. He could only attach them, under § 235 of the Code, as this court had decided, in Brownell v. Carnley, (3 Duer, p. 19.) The levy was properly made, under that section, and the subsequent purchase, by the plaintiff, was subordinate to the hen, which the defendant, as sheriff, then acquired. Nor was the defendant estopped, from asserting his Hen and special property, by his return in the suit against Turner & SchmuUing. When acts or admissions are relied on, as creating an estoppel, it must be shown, that they were designed to influence the conduct of the party setting them up. (Carpenter v. Westervelt, 1 Kernan, 734.)
    The counsel also contended, that the Judge on the trial had erred, in the admission of evidence, and, particularly, of the evidence that Herx was not a member of the firm of Pfeiffer, Yon Kamp & ■ Co.; and that he had also erred, in not granting the motion for the dismissal of the complaint.
   By the Court. Duer, J.

We think that the plaintiff upon several grounds (all of which, however, it will not be necessary to state) is entitled to judgment upon the verdict.

We can see no reason for doubting that the defendant is concluded, by his certificate and return in the action against Turner & Sohmulling, from denying any of the facts, which the certificate asserts, expressly, or by a necessary implication. He is, therefore, concluded from denying that, under the proceedings in that action, he took the goods from the possession of the defendants Turner & Schinulling, and delivered them into the possession of the plaintiff, and, consequently, from denying that they were in the actual possession of the plaintiff when they were again seized, by his deputy Crombie, upon the ground that they were bound by a prior levy under the attachments. Nor is this all. The defendant, by his voluntary delivery of the goods to the plaintiff, practically admitted that he had no right to hold them under the attachments, and, so far as the plaintiff is concerned, he released them, by this act, from any lien, that a prior levy might have created. If such a levy had, in fact, been made, it was his plain duty to have stated, in his return, that the goods were not in the possession of the defendants, Turner & Schmulling, but were in his own custody, by virtue of the attachments. The return that he made is, therefore, conclusive proof that, in his own judgment, the goods were not in his custody, and that he could not lawfully withhold them from the possession of the plaintiff; and, if so, he had, assuredly, no immediate right to disturb the possession that he had delivered. It may be, that when he delivered the possession to the plaintiff, he was ignorant of the fact that the attachments were then in the hands of a deputy, and, consequently, was ignorant of the proceedings of the deputy under them; but it is familiar law, that the knowledge and acts of a deputy, in the discharge of his official duties, are the knowledge and acts of the sheriff, so that, whether the sheriff acts, personally, or by a deputy, his liability to third persons, whose rights and interests are injuriously affected by the acts, is precisely the same.

There is a manifest error in the assertion that the acts and admissions of the defendant had no tendency to influence the conduct, and worked no prejudice to the interests, of the plaintiff, and, therefore, could not operate to create an estoppel, excluding a defence that would otherwise have been available.

The return made by the defendant, in the suit against Turner & Schmulling, was evidence, upon the record, that the goods, for the recovery of which the action was brought, had been delivered to the plaintiff, and this evidence necessarily prevented him from obtaining a judgment for the value of the goods, to which, as against those defendants, he would otherwise have been entitled. The defendant, by his return, prevented the plaintiff from obtaining this judgment, and then, by taking from him the goods that he had delivered, rendered the judgment, that was obtained, wholly valueless. It would, therefore, seem that no remedy was left to the plaintiff, unless by an action against the defendant, and it is impossible to say that he would not be prejudiced by permitting the defendant to set up as a defence the falsity of his own return, or, which is substantially the same defence, that the return is not that which his duty as sheriff required him to make.

Nor, as we apprehend, would the case be altered, were we to hold that the judgment-roll, including the defendant’s return, was improperly received in evidence, since all the facts, that the return certifies, were distinctly and fully proved by the deputy, Selah. He proved that the goods were taken by him from the possession of Turner & Schmulling; that he removed them to the store of Nash, the auctioneer; that he gave to the plaintiff an order for their delivery, which Nash accepted; and that the plaintiff paid his fees and the charges of Nash. From this time, therefore, it cannot be doubted that the goods, although not removed from the store, were, in judgment of law, in the plaintiff’s possession, and were held by the auctioneer merely as his bailee, and these are the facts that, in our opinion, and without calling in aid the return, may be justly held to exclude a defence under the attachments.

It is not, however, solely upon the ground of an estoppel that we intend to place our decision, and I shall therefore pass over that objection entirely, in the observations that are to follow.

As it is certain, that the goods were taken by the deputy Crombie, from the possession of the plaintiff, if that taking was wrongful, as the complaint avers, the plaintiff must be entitled to recover. And the taking was undoubtedly wrongful, if the plaintiff was then the owner of the goods, and no valid levy had been made, under the attachments, before his title was acquired.

It is not necessary to decide whether, when the testimony was closed on the part of the plaintiff, there was sufficient proof that he was the owner of the goods, or whether the motion then made for the dismissal of the complaint ought not to have been granted. We strongly incline to the opinion that the proof was sufficient, as the case then stood; but were this otherwise, the defect was fully supplied by the testimony of a witness called by the defendant, the uncontradicted testimony of Herx. He proved that the goods were his individual property, purchased with his own funds, and that before the commencement of the action against Turner & Schmulling, he sold them to the plaintiff and received their price. The only question, therefore, is, whether, when this sale was made, the goods were bound by the attachments then in the hands of the sheriff, so as to defeat the title of a purchaser having no notice that the attachment had been issued, for that the plaintiff is chargeable with notice has not been pretended.

The goods, it is certain, were not then bound by the attachments, unless the service, that the Code requires, had been duly made, nor unless the goods were the property of the persons named in the attachments, or of some one of them.

It is not denied, that the goods of a debtor are no more bound by an attachment under the Code, before its actual service, so as to defeat the title of a purchaser in good faith, than, as against such a purchaser, they are bound by an execution, before an actual levy. It is not pretended, that an absolute lien is created by the mere issuing of the process.

It is, also, certain, that if the attachments had not been served before the plaintiff acquired his title, the goods could not be attached, although the attachments remained in the sheriff’s hands, after the plaintiff became the owner, for the plain reason, that, whatever might have been the fact when the attachments were issued, the goods were not, at that time, the property of the persons named in the attachments, or of any one of them.

The alleged service, which is relied on as a valid levy, was made in August, 1853, and as the goods were then in the customhouse, and the duties unpaid, the counsel for the defendant was right in saying, that the sheriff could not require a manual delivery of the goods, but, according to the decision of this court in Brownell v. Carnley, (3 Duer, 9,) could only execute the attachments in the mode prescribed by § 235 of the Code.

By the provisions of that section, when the property to be attached is incapable of a manual delivery, the attachment may be executed by leaving a certified copy of the warrant with the individual holding the property, together with a notice “ showing the property levied on.”

"In this case, a certified copy of each warrant, together with a notice, was served upon the collector, and upon Turner & Schmulling, who, it is alleged, were the consignees of the goods, but the notice, as we infer from the evidence, and understand to have been admitted upon the argument, was general in its terms, and contained no specification whatever of the property meant to be levied on. It appears to us, that for this reason it was insufficient and void.

We think the words of the Code, describing the notice as “showing the property levied on,” are significant and material, and can only be satisfied by a notice, particularly describing the property, so as to enable the holder to identify it, and when released from his own lien or claims, deliver it, or its proceeds, to the attaching officer. It is this construction that, in our opinion, the words, and the policy of the law, alike require. A notice referring in general terms to the property, as belonging to the person or persons named in the warrant of attachment, would be plainly useless, since it would convey no other or further information than is contained in the warrant itself, and, of course, in the copy required to be served. The requisition of a notice thus general would be superfluous and unmeaning. Section 232 of the Code makes it the duty of the sheriff, to whom a warrant of attachment is directed, to make and return an inventory of the property, and, we apprehend, that such is his duty, in all cases, whether the warrant be executed by the manual delivery of the property, or by the service of a copy and notice. Hence, if, in all cases, an inventory must be made, it must, in all cases, be in the power of the sheriff to render the notice specific, since it will be rendered so by making it correspond with the inventory. If he has sufficient information to enable him to make an inventory, he has sufficient to enable him to give the notice, that, we think, the Code requires; and if he has not the information, it seems to us, that it is his duty to obtain it before he attempts to. execute the warrant. In the present case, no inventory, it is proved, was made, and we refer to the fact as evidence that the notice was general. A proper specification in the notice would have been, in effect, an inventory.

Upon full consideration, we are convinced, that the service of a notice such as the Code requires, that is, a notice “ showing the property levied on,” in 'the sense that we attribute to these words, is essential to the due execution of a warrant of attachment, where the property to be attached is “incapable of a manual delivery.” It follows that, as, in the present case the requisite notice was not given, the goods in question—even on the supposition that they belonged to the persons named in the warrants when the attachments were granted—were not levied on, under the warrants, at any time, before the plaintiff acquired his title, and were, therefore, wrongfully taken from his possession.

Finally, could we assent to that construction of the Code, for which the counsel for the defendant has contended—and which, we regret to learn, is that upon which the plaintiff and his deputies have usually acted—or, had it been clearly proved that the notice given was precisely that we deem to have been necessary, it would still be our duty to hold, that the justification set up has wholly failed, and that the plaintiff is entitled to recover.

The defendant had no authority under the attachments to seize, or levy on, the goods in question, as the supposition that they belonged to the persons named in the warrants, or to any one of them, so far from being established, is disproved, by the evidence.

Each warrant was granted to enforce the payment of a debt alleged to be due from the firm of Pfeiffer, Von Kamp & Co. The persons named as composing the firm are, Pfeiffer, Von Kamp, and C. F. Herx—and the defendant was directed to attach their joint and separate property—but the goods in question were not the property of the firm, nor of any one of the persons named as partners. They belonged exclusively to the witness Franz T. Herx, by whom they were sold to the plaintiff. Hence, the levy upon the goods, while in the custom-house, however regular it may have been in its form, was unauthorized and void, and the taking of the goods from the possession of the plaintiff, a wrong and a trespass.

The only reply that has been given to these views consists in an assumption—upon which the argument for the plaintiff was wholly rested, that Franz T. Herx and C. F. Herx were in reality the same person, and the mistake in the name, a trivial error, that might be justly disregarded. But we regard this assumption as purely gratuitous; no proof was given or offered of the alleged identity, and we have no right to say that it existed.

Had it been proved, that Franz T. Herx was a partner in the firm of Pfeiffer, Von Kamp & Co., and was the only person of the name of Herx in the firm, the misnomer would have been apparent, and might have been treated as immaterial, since it was certainly the property of the partner Herx, that was meant to be attached. But the proof is, that Franz T. Herx was not, and never had been, a member of the firm, while there was not a par-tide of evidence to show, that a real person of the name of 0. T. Herx was not a partner, and the partner whose name was concealed under the general words, and Go.and in the absence of contrary proof, we think, that we must intend that such was the fact, for it is this fact, that the warrants of attachments and the affidavits upon which they were founded, distinctly affirm. fj

It may well be, that the plaintiffs in the attachments, supposed that the Herx to whom the goods belonged, was .the partner Herx, in the firm that was indebted to them; but this was a mistake of the person, and . not of the name, and, assuredly, gave no right to them, or to the sheriff acting under their orders, to seize the goods of the innocent owner, to secure the payment of a debt that he never contracted, and for the payment of which, upon the very face of the process, other persons were wholly liable.

No one can doubt, that the sheriff, in proceeding under an attachment, acts just as certainly at his own peril, in applying the process to the property described, as in proceeding under a final execution. When he seizes and removes the property of A, under an execution against B, he is hable as a trespasser. He is just as hable, when he commits the same mistake and wrong in acting under an attachment, and it is this mistake and wrong that the defendant appears to have committed, through his deputies, in the case before us.

Upon all the grounds that have been stated, the jury was properly directed to find a verdict for the plaintiff, and he is, therefore, entitled to the judgment that he now claims.

Judgment for the plaintiff accordingly, with costs.


source: Caselaw Access Project

author: By the Court. Woodruff, J.

license: Public Domain

text:
    Charles French v. Plin White.
    The assignor of the plaintiff had loaned to the defendant large sums of money, through the years 1851 and 1852, payable on demand. In November, 1853, he accepted various promissory notes for the amount then due, payable at different periods, some of which had not matured at the commencement of this action. To sustain it, as thus brought for the whole amount loaned, it was alleged by the plaintiff that the extension of credit by the notes, was obtained through fraudulent representations of the defendant, as to his property. It was also alleged, that the original loan was obtained by similar frauds.
    The jury, (under a charge of the court, that the plaintiff could not recover unless the fraud was proven,) found for him, thus finding the fact of fraud.
    Upon the well-settled rule of law, the assignor could have recovered for the money originally lent, surrendering the notes thus fraudulently given, at the trial.

      Held, that an assignee of the claim and notes had the same right. That the assignment was not a mere transfer of a right to receiver for a tort, but of a money demand, which the fraud in procuring the extension, reinstated in its original force and character.
    The allegation of fraud, in procuring the original loan, was in no way material to the right of action, nor for any purpose of the trial, except as evidence of a premeditated scheme to defraud the party.
    An exception, in the following terms, to the charge of the court, “ The defendant’s counsel excepted,” is too general, and cannot be regarded as an exception.
    Although fraud had been made out, in obtaining the loan, the plaintiff could not have recovered, unless fraud in procuring the extension was also proven. If there was no fraud originally, yet the action could be sustained, if there was fraud in inducing the party to take the notes.
    Evidence was allowed at the trial, of imposition and fraudulent statements, made by the defendants to other persons, during the period of making the loans in question.

      Held, that had the question here been as to fraud in procuring the loans, such evidence was plainly admissible.

      Held, further, that as evidence of this fraud was allowable, to show an original and continued scheme to defraud, testimony as to cotemporaneous frauds of the same character, practised upon others, was also admissible.
    (Before Boswobth and Woodruff, J.J.)
    January, 1856.
    Case upon a verdict in favor of the plaintiff, ordered to be heard at the General Term in the first instance, and judgment, in the mean time, suspended.

      P. W. Clark, for plaintiff.

      L. B. Shephard, for defendant.
   The material facts sufficiently appear in the opinion of the court.

By the Court. Woodruff, J.

In this case it appeared, and the verdict 'must be taken to find, that George W. French lent to the defendant twelve thousand five hundred dollars, in various sums, from time to time, in the years 1851 and 1852. The testimony in regard to the terms of the loan is, that there was no agreement as to the day of payment or rate of interest. The money was, therefore, payable by the defendant on demand.

If the lender had assigned his claim for this money to the plaintiff, while it remained in the simple form of a claim for money lent, there would have been no question of the right of the latter to recover—the case would have exhibited an ordinary money demand, assigned to the plaintiff by the creditor, and the plaintiff’s right of action would have been complete, by proving the loan by the assignor and the assignment to himself; and had this been the whole case exhibited by the parties, the question whether the defendant procured the loan by fraudulent representations would have been wholly immaterial, and the evidence, bearing upon that question, irrelevant.

But, in November, 1853, many months after the money was lent, the assignor of the plaintiff accepted the promissory notes of the defendant, payable, at various dates, for the amount of the loan, some of which notes were not due at the time this action was brought. To avoid the effect of these notes, as an extension of the time of payment of the moneys, the plaintiff avers, that his assignor was induced to take these promissory notes, by the fraudulent representations of the defendant, in regard to his property and ability to pay, and was deceived and defrauded into the giving of this extended credit. It is true, that the complaint also avers, that the original loan was procured by false and fraudulent representations, but this averment, I apprehend, might have been struck out, as immaterial and unnecessary to sustain the plaintiff’s action, since, as before remarked, , if the loan was made and was payable on demand, the right of action was complete, whether there was fraud in procuring the loan or not. The proof of the original fraud, on the trial, was not necessary, nor material, except so far as it formed part of an entire scheme to defraud, which terminated in inducing the assignor of the plaintiff to accept the defendant’s notes, before referred to. The jury have found, distinctly, that the defendant was guilty of the fraud alleged, under a charge from the court, which instructed them, that, unless they found the fraud, they could not find for the plaintiff.

Under this verdict, the case stands thus: the assignor of the plaintiff, having a money demand, for loans made to the defendant, is induced, by fraud, to accept promissory notes giving an extended credit to the defendant.

It is not necessary to examine the reports, to find authority for the proposition, that this fraud vitiated the credit thus agreed to, and no obligation whatever rested upon the assignor of the plaintiff, to delay his action for an hour. All that it was necessary for him to do, was, to produce the notes, on the trial, to be cancelled. Indeed, upon the facts, thus found, it is manifest that the assignor of the plaintiff had, at all times, from the moment the loans were made, to and at the time of the assignment, a just and valid claim to the money lent, and a right of action therefor.

Under these circumstances, he assigned this claim to the plaintifij and delivered to him the notes; and I perceive no ground, upon which to hold that such a claim was not assignable.

The counsel for the defendant has treated the assignment, as if it were the assignment of a mere tort, and referred us to some authorities, which, he conceives, show, that the right to recover damages, for a tort of this description, is not assignable. But the present is an action for money lent—not for damages, as such. The complaint states the lending of the money, a demand of repayment, non-payment by the defendant, and demands judgment for the sum remaining due, with interest. It may, perhaps, account for the introduction into the complaint of the averment, that the debt was, in the first instance, fraudulently contracted, to suggest, that it was at one time held, by some Judges, that if the plaintiff desired to arrest the defendant on that ground, and, finally, to have execution against his body, such an averment in the complaint was necessary; but that doctrine being repudiated, the fact, that the defendant procured the loans by fraud, was in nowise material to the right of action, nor material for any of the purposes of the trial, unless it was evidence of the scheme, which was consummated by inducing the plaintiff’s assignor to take the notes, as before suggested.

The question, whether a right of action for a tort is assignable, and under what circumstances, does not arise. As conceded by the defendant’s counsel, it was the claim for the money lent which was assigned, and that is the claim set up in the complaint, and for which judgment is demanded.

There was no proper exception to the charge of the court to the jury. The general statement, that the defendant excepted to the charge, is too general to be treated as an exception, unless every part of the charge is erroneous, and so it is well settled. (Lansing v. Wiswall, 5 Denio, 213; Haggart v. Dunn, 1 Selden, 422-7; Jones v. Osgood, 2 id. 233; Hunt v. Maybee, 3 id. 273, 4 id. 37; 1 Kernan, 416.) But it seems, at least, doubtful whether the Judge was not himself misled, by the averments in the complaint that the original loans were procured by fraud, for, in his charge, he says: “ The first question is, was this money lent upon fraudulent representations?” If he had made the right of the plaintiff to depend upon this question alone, there would, I think, have been error in his direction, for which, on a case, a new trial should be ordered; for, according to the views above expressed, the title of the plaintiff to recover did not at all depend upon this question. If the money was lent upon such representations, still the plaintiff could not recover, unless the fraud also extended to the giving and receipt of the notes, afterwards taken for the loan, by the plaintiff’s assignor. And, on the other hand, if there was no fraud, in the procurement of the loan, the plaintiff was entitled to recover, if he showed that the defendant induced his assignor to take the notes by fraud.

But the court did not leave the case upon that sole question; the instruction to the jury was, also, that, to entitle the plaintiff to recover, they must “ also find, that White committed a fraud, in inducing French to accept the notes.”

The defendant, therefore, has .no cause of complaint, in this respect, but rather the plaintiff, if the views above expressed are correct.

In substance, the charge was, that, to entitle the plaintiff to recover, the jury must find, not only that the loan was procured by fraud, but that French was afterwards also induced, by fraud, to accept the notes; whereas, according to our view of the case, if French was induced by fraud to accept the notes, the plaintiff was entitled to recover, whether the loan was originally procured by fraud or not.

There is, therefore, in this respect, no reason to interfere with the verdict. The charge was more favorable to the defendant than he had a right to ask.

It is urged, that the court, in the charge to the jury, called to their attention matters tending to prove fraud, on the part of the defendant, which were not specified in the complaint. In the first place, the complaint avers specific representations, and that they were false, and were made to defraud. The court refers to those representations, and presents to the jury the inquiry, whether the money was loaned upon such fraudulent representations. The further reference of the court, to the conduct of White, was quite proper, because these acts -bore directly upon the intent with which the loan was procured. Although these acts were not the acts of fraud averred, they were proper evidence of the fraud of the defendant in the acts which were averred, and it is, in this view, they were submitted to the jury. But, in the next place, the defendant has no reason to complain of this part of the charge, for, as last above suggested, the plaintiff was entitled to recover, whether this portion of the fraud was proved or not.

It does not appear, very distinctly, by the case, at what time the fraud, on the part of the defendant, in inducing the assignor of the plaintiff to receive the notes, was discovered; and no point was made, on the trial, nor on the argument of the appeal, on the question, whether the recovery of judgment upon two of the notes, could operate to prevent the plaintiff’s repudiating the credit, fraudulently obtained by the defendant. It is, therefore, unnecessary to inquire, here, under what circumstances, if any, the bringing of an action, and recovery of judgment, upon a portion of the notes, would prevent the subsequent surrender of the residue, and his claim to recover, for the original loan, to the amount covered thereby.

The only remaining question is, whether there was any error in receiving the testimony of Willet E. Hawkins, showing like false representations made by the defendant to him, and procuring money from Mm, under circumstances plainly indicating falsehood and fraud, on the part of the defendant, during the very period in which he was procuring the loans in question from the plaintiff’s assignor.

That this evidence was proper, if it was material to show that the loan was procured by fraud, cannot be questioned. That when the question is, whether a vendee of goods procured the sale by fraud, like transactions with others, at, or about the same time, may be given in evidence, with a view to the quo animo, was held, in cory v. Hutching, (1 Hill, 311,) and numerous cases are cited in support of the decision. The. case of fraud, is regarded as an exception to the general rule of evidence, in regard to similar testimony. And see also Olmsted, &c. v. Hutching, (id. 317.)

The plaintiff relied upon showing, that the defendant had been engaged in a scheme, to defraud those upon whose credulity he could impose f and the entire Mstory of the defendant’s dealings with him, in regard to this money loaned, would tend, in some degree, though perhaps remotely, to show that it was with a continued intent to defraud, that he made the representations, inducing the plaintiff’s assignor to receive the -notes. The acts of the defendant, from the beginning to the end of the particular transaction in question, and the repetition of representations, all of which proved false, may all tend to establish the fraud. But the more satisfactory answer to the objection, is, that the whole of the proceedings in the action, from the complaint to the verdict, were conducted under the idea, that it was necessary for the plaintiff to prove that the debt was fraudulently contracted, and the court charged, that, to warrant a verdict for the plaintiff, the jury must find that the loans were procured by fraud. This evidence, as above suggested, tended directly to show the intent of the defendant, in those cotemporaneous transactions; and the defendant cannot, with propriety, object, that the plaintiff was required and permitted to prove all the facts, alleged in the complaint, and put in issue by the answer.

It is not urged that the verdict is against evidence, or without evidence to support it. The proof of fraud in inducing the assignor of the plaintiff to accept the notes is very slight; the evidence that he believed the defendant’s representation that he was at that time worth $300,000, is still less. And that he could have relied upon any such representation, with, knowledge of the previous acts of the defendant, and his absconding to Europe in the manner he did, seems hardly probable. And so, also, the question whether the recovery was not, in fact, to a large extent, for the identical moneys for which other parties had previously obtained judgments against the defendant, as the real principals in the loans procured by the defendant through the plaintiff’s assignor, appears to us to involve the justness of the verdict in great doubt. But no such points are made by the defendant. The case has been treated by both parties as before us upon questions of law only, and we ought, therefore, to regard the verdict of the jury, under all the circumstances, as conclusive upon these questions, though we yield to it with some hesitation.

We think the grounds urged upon us, in the argument, and points submitted on the part of the defendant, do not require us to interfere with the verdict.

Judgment should therefore be entered for the plaintiff, in conformity with the verdict, with costs.


author: Bv the Court. Duer, J.

text:
    Charles Gould v. Boltis M. Segee, impleaded, &c.
    The rule that protects the bond fide holder of negotiable paper, fraudulently or feloniously put into circulation, applies to all negotiable paper, whether payable to bearer, or order, immediately, or on a future day.
    The protection of the rule is not confined to those whose usual business it is to deal in negotiable paper, but extends to every person to whom such paper may be lawfully transferred, and who, by the payment of value, may acquire a title.
    The satisfaction of a precedent debt, this court has frequently decided, is a valuable consideration, within the meaning of the rule, and this, since the decision of the Court of Appeals, in Youngs v. Lee, (2 Her. 652,) must be deemed the settled law of the state.
    When a parting with value is proved, the amount of the consideration paid is not otherwise important than as bearing on the question of actual or constructive notice.
    Hence, when usury is not set up as a separate defence, unless it is so gross as to create a presumption of fraud, the proof of its existence may be justly disregarded.
    A person whose name, written by himself, is on the back of a negotiable bill or note, is liable as an endorser to a bond fide holder, although he may not have delivered the paper to any one for the purpose of transferring a title.
    Verdict for defendant set aside, and new trial granted,
    (Before Duer, Bosworth and Hoffman, J.J.)
    Heard, January;
    decided, February, 1856.
    Appeal, by plaintiff, from a judgment in favor of defendant, Segee.
    The action was against Segee, as the maker, and Frederick W. Greissenhainer, as the endorser, of a promissory note for $195.00, dated February 28, 1853, and payable, three months after date, to the order of Greissenhainer. The complaint (Contained the usual averments.
    The defendants answered separately. Each answer admitted the making and endorsement of the note, and set up as a defence the following facts.
    That the note was made for the accommodation of Greissenhainer, to whom it was delivered by Segee. That Q-eissenhainer endorsed the note, and put it in a desk in his office; that, during his absence, one H. Parker came there, took the note from the desk, and carried it away under a pretence of procuring the same to be cashed; that Parker passed, the note to one Oourtlandt Palmer, who gave no valuable consideration for it, but took it in payment of an old debt; that Palmer was the holder of the note when it became due, and that the plaintiff had not acquired the same for a good and valuable consideration.
    The cause was tried before Oakley, Ch. J., and a jury, in October, 1854.
    The following are the proceedings on the trial.
    The plaintiff produced and put in evidence the following note and endorsements, and proved the amount of principal and interest due by the face thereof was $192.24.
    $175. February 28th, 1853.
    Three months after date, I promise to pay, to F. W. Greissenhainer, Jr., or order, one hundred and seventy-five dollars—value received. Boltis M. Segee, 820 Broadway.
    (Endorsed) F. W. GIeissenhaiwer, Jr.
    (Also endorsed) C. Palmer.

      The defendant Segee called, as a witness, his codefendant, Frederick W. Giessenhainer, Jr., who testified, that Segee lent him the note, for his accommodation, and to enable the witness to raise money to take up a previous note of the witness, endorsed by Mr. Segee, which had been discounted in bank, and was then about to become due, and he never gave Mr. Segee any thing for it; that he, the witness, did not negotiate the said note, or pass it away, but, having endorsed it, he placed it with another note, in a drawer of a desk in his office, and never saw it afterwards, nor did he know, of his own knowledge, how it got into circulation or into the hands of the plaintiff.
    Cross-examined.—The witness added as follows: I left my office, where the desk was, at two o’clock; I returned the same afternoon, about four o’clock, and found the notes gone; I inquired of my clerk, Mr. Donaldson, what had become of them, and he said one Hiram Parker had come in, and, having opened the drawer and found the notes, took them away, and said he would get them cashed; I found fault with him for allowing Parker to take them; he said, that Parker said “ it was all rightI never delivered this note to Parker, for that or any other purpose; I went to look for Parker, but could not find him; I went to a place where he had kept an office, and to other places, but could find nothing of him, and shortly afterwards I found Parker locked up in Eldridge street jail; I went to the jail and saw Parker, and asked him for the note; he .promised to return it to me, and said he had not used it; from what he said, I inferred it was among his papers, somewhere else, and not there in the jail; I did not advertise the note, nor give public notice of its loss, because I expected to find him, daily, until I found him in the jail, and because, when I saw him, he promised to return it; I did not bring an action against him, to recover the note, for the same reason, and because it would be useless; he was already in jail, and I could do no more than put him there, and, besides, he promised to return it; Parker had been at my office several times; he was not a client; he had sold some lots to me, and I had paid him money on account of them, but I ascertained that he had no authority to sell them; I had known Parker two or three months, but had known him as a real estate broker for some years; he has never settled with me, in regard to the lots he professed to sell me; I borrowed this note from Mr. Segee, for my own use; I intended to get it discounted, for the purpose of paying a note then in bank, but, having received some money from another source, I put it into my drawer, after having carried it in my pocket three or four days; Parker had an office in the Fourth avenue, and I went there to look for him; I also went to the Sixth avenue, where he formerly had an office, but could not find him; I lived in Fourteenth street, near Fourth avenue, at the time, and Mr. Segee kept a store at the corner of Broadway and Twelfth street.
    Direct.—I received this note on the day of its date; Parker was utterly irresponsible, and generally known to be so; he left the country, on his release from prison, and I understand he has gone to California.
    Alexander Donaldson, a witness for both defendants, testified as follows: I am clerk of Giessenhainer, and have been so since February 1st, 1853; I have seen this note before; I cannot fix the exact time, but it was shortly after the date; Mr. Geissenhainer had it, and placed it in a drawer of his desk; whilst Mr. Geissenhainer was absent from his office, Hiram Parker came and sat down at Mr. Geissenhainer’s desk, and wrote something; he then opened the drawer where the notes were, and, after looking at them awhile, he got up to go out; I told him, “ I cannot authorize you to take away those notes,” but he said it was “ all rightI told him I had no authority to deliver them to him, but he repeated that it was all right, that they were intended for him, or something to that effect, and went out; when Mr. Geissenhainer came in, I told him what Parker had done, and he found fault with me; he said he would go and find Parker and get them back, and went out; I never saw any thing of Parker afterwards, until I was informed he was in the Eldridge-street prison; I then went to see him, by direction of Mr. Geissenhainer, and asked him for the notes; he said he had them and would return them, and I reported to Mr. Geissenhainer what he said; I understand Parker is gone to California, and that he went directly after he was liberated from prison.
    Cross-examined.—This witness added: that he knew Parker before, and had seen him several times in Mr. Geissenhainer’s .office, and knew him very well; upon this occasion, he sat at the desk and wrote, perhaps, ten minutes, before he opened the drawer and took out the notes; Parker was a real estate agent or broker, and I have heard him say that he sometimes negotiated bills and notes; he did not say that he was going to take this note to get it discounted, and I did not tell Mr. Geissenhainer that he said so; Mr. Geissenhainer thinks that I told him so, but he is mistaken; I did not, and could not have told him so; I inferred from Parker’s manner that he intended to get the note discounted, and may have told Mr. Geissenhainer that inference, but I have no recollection of it; Mr. Geissenhainer said he must go and hunt him up, and went out; I never saw Parker about town, after his liberation from Eldridge-street jail, but understood he was about a short time.
    Charles Gould, the plaintiff, being called by the defendants, testified as follows: After this note fell due, I purchased it for $162.50; it had been endorsed by Oourtlandt Palmer; I bought it of him, and paid him for it; it is exclusively my own.
    Oourtlandt Palmer, a witness for the plaintiff, testified as follows : In March, 1853, before the maturity of the note, I discounted it in good faith, for a valuable consideration, without notice or suspicion of any defence existing against it; I took it from Hiram Parker; he requested me to cash the note to oblige him, and told me that it was a business note which he owned, and which he had received from the endorser, Mr. Geissenhainer, for commissions on the sales of real estate, and I believed what he said; after some conversation, I told him I would cash the note, if he would deduct the interest till maturity, and satisfy, from its proceeds, a due-bill I then held against bim for about twenty dollars and interest; this he declined doing at that time; about two days afterwards, Parker called a second time, at my office, with this note, and then said he would comply with said terms; I thereupon took the note from him, gave bim my check for $145, which was paid at the bank, and cancelled his debt on the due-bill, which, with interest, came to a little more than the balance of this note; his first call, with the note, was March 6th, and his second call March 8th, and, both times, he came openly to my office, on Broadway, and remained at his ease there; afterwards I endorsed the note, and had it discounted, and, after receiving notice of protest, I took it up, and subsequently transferred it, through a friend, to Mr. Gould; on receiving the notice of protest, I called on Segee, and asked him what it meant; he then told me, that he gave the note to Geissenhainer, as a business note, and for business purposes.
    Cross-examined.—This witness added: The due-bill I discharged was an old one, but it was not seven or eight years old; it was not barred by the statute of limitations; it was not outlawed; I did not deliver the due-bill to Parker, for I had not got it with me; I never delivered it; I purchased this note as a business note; there is no understanding between me and the plaintiff, and I gave no orders for the bringing or prosecution of this action; when Parker came to my office, both times, he was alone; I did not notice a sheriff, or sheriff’s officer, in company with Parker, or in the neighborhood of him; I may be indebted to Mr. Segee; I believe he has a small bill against me; I did not tell his clerk that I would pay it, because I had a claim against Mr. Segee, on this note; I did not give that reason, but I said I would not pay it; Mr. Segee knows where I live, and has his remedy; I never called on Segee about the note, till after it was protested.
    No other evidence was given on the trial.
    The plaintiff's counsel requested the court to charge the jury, that the note, having been acquired by Palmer in good faith, and for a full and valuable consideration, before its maturity, and having been transferred, by him, to the plaintiff, the plaintiff was entitled to enforce the note, and have a verdict in this action, notwithstanding the alleged defence; and, also, that the plaintiff was entitled to recover the full amount of the face of the note, with interest.
    The court thereupon charged the jury, that if they were satisfied, from the testimony, that Palmer received the note, before maturity, and for a valuable consideration, and subsequently transferred it to the plaintiff, the plaintiff was subrogated to all the rights of Palmer, at least, to the extent of what he paid for it, and might recover upon it, notwithstanding that he received it after it became due. That, notwithstanding what had been said about the note, as a business note, it was clear, that the note was loaned, by Segee, to G-eissenhainer, for his accommodation, and had no vitality, until it was delivered to some one, as evidence of a valid subsisting debt. That, if the evidence for the defendant was entitled to credit, Parker had no legal title to the note, but his possession of it was tortious and fraudulent, though he could not be said to have stolen it. That the question, for the jury to pass upon, and upon which their verdict must depend, was, whether Mr. Geissenhainer had done what a prudent man should do, to reclaim the note, after he was informed that Parker had taken it, or whether he was guilty of such, laches, and neglect, as would authorize them to infer -that he assented to Parker’s possession of the note, for the purpose of negotiating it. That, in rendering their verdict, they had a right to discriminate, and render a verdict in favor of one defendant, and against the other. That, so far as Geissenhainer was concerned, testimony given by him must be laid out of view, in considering their verdict, and they must look into the other testimony, to see whether he had succeeded in establishing his defence, but that his testimony was competent for the defendant Segee.
    The court declined to charge the jury otherwise than herein contained.
    The plaintiff’s counsel hereupon excepted to that part of the charge which stated, that the question for the jury, on which their verdict must depend, was whether Geissenhainer had done what a prudent man should do, to reclaim the note, after he was informed that Parker had taken it, or whether he was guilty of such laches, and neglect, as would authorize the jury to infer that he assented to Parker’s possession of the note, for the purpose of negotiating it.
    The plaintiff's counsel also excepted to the refusal of the court above mentioned.
    And the court further charged the jury, that, if they found for the plaintiff, against either or both of the defendants, their verdict must be limited to the sum paid by the plaintiff for the note, with interest on the sum from the time of such payment; to which charge and instruction the plaintiff’s counsel excepted.
    The jury found, for the plaintiff, the sum of $177.66, against the defendant Giessenhainer, and in favor of the defendant Segee.
    To set aside which verdict, as to Segee, and obtain a new trial against him, and also to recover judgment for the debt and interest against him, and also to ask for an increase of the verdict against Geissenhainer to the sum of $192.24, a case was made, with leave to the plaintiff to turn the same into a bill of exceptions or special verdict.
    January 30.—The case and exceptions were now argued.

      O. Tracy, for the plaintiff.
    The note was valid in Palmer’s hands, and the plaintiff, by his purchase, acquired all Palmer’s rights. The Judge’s charge was, therefore, erroneous, both for his refusal to instruct the jury as he was requested, and for the instruction given that the verdict depended upon the authority of Parker to negotiate the note to Palmer. The judgment in favor of Segee ought, therefore, to be reversed, and, as against him, a new trial be granted. I refer to the following authorities, as conclusive in favor of the plaintiff. (1 Duer, 309; 4 Comst. 166; 5 Barb. 429; 21 Wend. 409; 23 id. 311; 1 Denio, 583; White v. Springfield Bank, 3 Sand. S. C. R. 222.)
    The Judge’s charge was also erroneous, in limiting the recovery against Greissenhainer to the sum paid for the note by the plaintiff. The verdict ought to have been for $192.24, the sum actually due upon the note, and I move the court to increase it to that sum. (7 Wend. 569; 8 Paige, 552; 13 John. 52; 4 Hill. 482.)

      J. S. Carpentier, for defendant, Segee.
    The note never had a valid inception, and created no liability on the part of the maker, either to the payee or any other person; it was made for the accommodation of the payee, and, in the proper sense of the term, was never endorsed by him to any one. His accidental endorsement, not the result of a contract, could give no title to any one except, perhaps, to a person receiving the note in good faith, in the course of his business, without notice, and for a valuable and full consideration. (Bromage v. Lloyd, 1 Excheq. R. 32; Brind v. Hampshire, 1 Mees. & Welsby, 365; Marston v. Allen, 8 id. 494; Cox v. Troy, 5 B. & Ald. 474.)
    Palmer was not k bond fide holder for value. He took the note for a precedent debt, and paid only a balance in cash. He did not give that full, fair and valuable consideration, which the authorities show was requisite to render his title perfect. (Goldsmith v. Lewis Co. Bank, 12 Barb. 407; Bay v. Coddington, 5 John. Ch. R. 54; S. C. 20 John. 639; Catlin v. Gunter, 3 Kern. 368.) As to the plaintiff, he bought the note for less than its nominal value, after it had been dishonored, and is chargeable, in law, with full notice. (12 John. 306; 1 Bos. & Pull. 648; Holbrook v. Mix, 1 E. D. Smith, 154. There was no error in the charge of the Judge, as to the amount of the recovery against Greissenhainer. In fact, the verdict against him was for a larger sum than it ought to have been.
    None of the exceptions to the charge of the Judge were well taken, and the judgment, instead of being reversed, ought to be affirmed, with costs.
   Bv the Court. Duer, J.

We apprehend that no rule of the law merchant is more fully settled, than that which affirms the title of a bond fide holder, for value, of negotiable paper, notwithstanding the person by whom it was transferred to him, had acquired its possession by felony or fraud; nor do we at all doubt that the salutary rule is just as applicable to paper transferable only by endorsement, as to that transferable by delivery alone; it is just as applicable to bills of exchange and promissory notes, payable to order, as tc/bank bills, payable to bearer. That such is the law is declared, or necessarily implied, in nearly every case, having any bearing on the question, that is to be found in the books, including those which, upon the argument, were cited, and mainly relied on, by the counsel for the defendant; and, using the very words of the Supreme Court of the United States, we hold ourselves justified in saying, that the doctrine is so well and so long established, that it is laid up among the fundamentals of the law, and neither reasons nor authorities are now necessary to be brought forward in its support.” (Swift v. Tyson, 16 Peters, p. 1.) It is true, that the plaintiff purchased the note in suit after it became due, and if Palmer, from whom he made the purchase, had no right to transfer it, he cannot recover; but if the title of Palmer was unquestionable, that of the plaintiff cannot be impeached. He stands in the place of Palmer, and has succeeded to all Palmer's rights and remedies.

The first question, therefore, is, whether, upon the evidence, we are not bound to say that Palmer was an endorsee for value, and without notice, and, consequently, whether, as the facts were undisputed, the jury ought not to have been instructed that the plaintiff was entitled to their verdict against both defendants. Palmer was the only witness by whom the transfer of the note was proved, and he was uncontradicted and unimpeached.

We must, therefore, regard it as certain, that the note came into Palmer’s hands before it was due, and that he gave value for it when he received it; nor, unless he had actual or constructive notice of the fraud of Parker, is his good faith, in thus receiving it, liable to question. That he had actual notice is not pretended, and we are clearly of opinion, that no circumstances were shown that ought to have awakened his suspicions, and put him upon inquiry, and, consequently, that there was no ground for imputing to him a knowledge that was not proved.

It has, however, been contended, that, admitting that the facts attending the transfer of the note were exactly such as stated by Palmer, we are still bound, by prior decisions, to say that he acquired no title, ap.d could, therefore, pass none to the plaintiff. It appears, it is said, that the note was not received by him in the usual course of his business, and. that the consideration for its transfer was not full, and was usurious, and each of these circumstances, it is insisted, is of itself, a bar to the plaintiff’s recovery. We are far from thinking so.

In every action, by a holder for value, of negotiable paper, which has been put into circulation by fraud, it, is, doubtless, a proper inquiry, whether the bill or note was taken by him in the ordinary course, not of his own business, but of similar transactions ; for, where it appears that the circumstances accompanying the transfer, were unusual, the question, whether they ought not to have awakened his suspicions, and put him upon inquiry, in other words, whether they did or did not amount to constructive notice, must be submitted to the determination of the jury. But it is a mistake to suppose that the protection, which the law extends to a bona fide holder for value, is limited to a particular class of persons ; to those only who deal in negotiable paper, as a part of their regular and ordinary business, such as merchants, bankers and brokers. As we understand the law, the protection of the rule extends to every person to whom negotiable paper may be lawfully transferred; to every person, who, by the payment of value, may acquire a title.

The objection that there was not a full and fair consideration for the transfer of the note in suit, is contradicted by the evidence. If the debt, cancelled by Palmer, is added to the sum which he' paid inz-cash, the amount, it is proved, exceeds the face of the note. / The actual satisfaction of a precedent debt, it was decided by this court, in White v. The Springfield Bank, (3 Sand. 222,) is as truly a valuable consideration as the payment of money, and we think, by a recent decision in the Court of Appeals, this is now established as the law of the state. (Youngs v. Lee, 2 Kernan, 552.j) But had there been no other consideration proved, for the transfer of the note, than the payment in money, that was made by Palmer, we are not to be understood, as intimating, that the plaintiff would not be entitled to recover. When, in cases like the present, a parting with value is proved, the amount of the consideration is not otherwise important, than as bearing on the question of actual, or constructive, notice. Hence, when usury is not set up as a separate defence, unless it is so gross as to raise the presumption of. fraud, the proof of its existence may be justly disregarded. Where! an accommodation note is purchased at a rate of discount, exceeding that of lawful interest, the transaction, in judgment of law, is usurious, but the mere fact that it is so, is no evidence of the bad faith of the purchaser; is no evidence that he knew, or suspected,/ that the holder of the note, from whom he derived his title, had no right or authority to transfer it. J

The objection that remains to be stated, is, at first view, more plausible than those that have been considered. The plaintiff, it is said, can have no title to the note, unless it was endorsed by Greissenhainer, the payee, and its endorsement by him is disproved by the evidence. It is true, his name, in his own handwriting, is on the back of the note, but the note was never delivered by him, either to Parker, or to any one, either for value, or for the purpose of being negotiated, and to render an endorsement valid, as passing a title, such a delivery is alleged to be essential. In support of this position, we are referred to several cases, in which the courts, in England, have held that a plea, denying the endorsement of a payee, is sustained by proof that the bill or note, on the back of which his name is written, was never delivered by him, with the intent of passing an immediate title, or an authority to transfer it. The authority of these cases, to which several, not cited by defendant’s counsel, might be added, is not meant to be ¡ denied, but upon examining them, it will be found that in not 1 one of them was it proved that the plaintiff was a bona fide holder, j for value, and in most of them it is distinctly admitted that, had ' this proof been given, the defence would not have been allowed to ' prevail. The doctrine, therefore, which these cases establish, is ; this, and only this, that where the non-delivery, by the payee, of , a negotiable bill or note is proved, the burden of showing that: a valid title was acquired, by its subsequent delivery to a holder, without notice, and for value, is cast upon the plaintiff.

The case,uin which the law on this subject seems to have been the most fully considered, is that of Marston v. Allen, in the Court of Exchequer, (8 Mees. & Welsby, 494.) The action was against the acceptor of a bill of exchange, which, the declaration averred, had been endorsed by the payee, John Hanop, to one E. Marston, and by him to the plaintiff. The plea denied the endorsement of the payee. Upon the trial, Hanop was called as a witness for the defendant, and, admitting that his name on the back of the bill was in his own handwriting, swore that he had received the bill as the accountant of a bank, to which it belonged, and that he had delivered it to a clerk, one W. Marston, to be kept by him in safe custody for the bank.

E. Marston, the second endorser, was then called as a witness for the plaintiff, and proved that he had received the bill from W. Marston, for value, and that he had endorsed and delivered it, for value, to the plaintiff To rebut this evidence, the counsel for the defence then offered to show that both E. Marston and the plaintiff had received the bill with full knowledge of the fraud committed by W. Marston, in transferring it. The learned Judge who tried the cause, held that this proof was inadmissible, under the pleadings, and directed the jury to find a verdict for the plaintiff. A new trial was moved for, on the ground that the evidence, so offered, was improperly rejected. The court in bank, after a full argument, being of that opinion, the motion was granted, and a new trial ordered.

Alderson, B., in delivering the judgment of the court, said, (inter alia,) “ that they had been much pressed with the difficulty that there had been a delivery of the bill to the plaintiff for the purpose of transferring it, and, no doubt, (he added,) had this delivery been bona fide, and for value, it would have been quite sufficient to give a title to the plaintiff” He then proceeded to lay down the general rule of law, in the words following: “By the law merchant, every person, having possession of a bill, has, notwithstanding any fraud on his part, in acquiring or transferring it, full authority to transfer said bill, but with this limitation," that to make such transfer valid, there must be a delivery by him, or by some subsequent holder of the bill, to some one who receives such bill, Iona fide and for value, and is himself either the holder, or the person through whom the holder claims.” (Vide, also, Lloyd v. Howard, 20 Law Jour. R. (N. S. p. 1;) 1 Law & Eq. R. 227; Palmer v. Richards, 1 Law & Eq. R. 529; Hardey v. Towers, 4 Law & Eq. R. 531.)

It is obvious that the terms of the rule, thus laid down, were carefully selected, and they plainly embrace the case before us. Parker, notwithstanding his possession and transfer of the note were fraudulent, had full authority to transfer it to a person, receiving it without notice of the fraud, and for value. The evidence shows that it was so received by Palmer, to whom he delivered it, and that Palmer is the person through whom the plaintiff, the present holder, claims.

It follows that the verdict for the defendant is against law and evidence, and must be set aside, and a new trial be ordered; and if, upon the next trial, the evidence shall be the same as upon the first, the jury must be instructed to find a verdict for the plaintiff, for the amount of the note, with interest.

Hew trial, costs to abide event.