Case ID: mass_75/html/0329-01.html
Source: Caselaw Access Project
Author: {"author": "Shaw, C. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Ernest Cazet vs. Horatio Field.
    A negotiable promissory note, given for intoxicating liquors sold in this commonwealth contrary to St. 1852, c. 322, is valid in the hands of one who took it before maturity, íct a valuable consideration, and without notice of the illegality, notwithstanding the provision of § 19 of that statute, declaring that all payments and compensations for intoxicating liquors illegally sold “ shall be deemed to be received in violation of law, without consideration, against law, equity and good conscience.”
    Action of contract on a negotiable promissory note, made at Taunton, on the 17th of October 1854, payable to Orringe IX Day or order, and by him indorsed to the plaintiff, a merchant in New York. The consideration of the note was intoxicating liquors sold by Day to the defendant in this commonwealth contrary to St. 1852, c. 322. But the note was indorsed to the plaintiff before it was due, for a valuable consideration, and without notice of the original unlawful contract. The case was submitted to the decision of the court upon the foregoing facts, and others not material to the understanding of the point decided.
    
      G I. Reed, for the plaintiff.
    
      E H. Bennett, for the defendant.
    A note, made void by statute, is void, even in the hands of a bona fide holder. Bowyer v. Bampton, 2 Stra. 1155. Lowe v. Waller, 2 Doug. 736. Unger v. Boas, 11 Penn. State R. 601. So is a note made void by the common law, such as a note given to compound a felony. Bell v. Wood, 1 Bay, 249. A statute may make a note void by necessary implication, as well as by express words Story ou Notes, § 192. Territt v. Bartlett, 21 Verm. 184. On this principle, notes made on Sunday have been held void in the hands of an indorsee. Allen v. Deming, 14 N. H. 133. Goss v. Whitney, 27 Verm. 272. Pattee v. Greeley, 13 Met. 284. The St. of 1852, c. 322, § 19, declares that “ all payments or compensations for liquors sold in violation of law, whether in money, labor or personal property, shall be held and considered to have been in violation of law, without consideration, and against law, equity and good conscience.” These words are equivalent to the word “ void.” The object of the statute is not merely to protect the purchaser, or even to punish the seller, but to discourage the traffic; and this object would be evaded by allowing the purchaser indirectly to receive the price of the liquors by negotiating the note to a third person.
   Shaw, C. J.

The question in this case is, whether, upon this note given for the price of liquors sold here in violation of the law of this commonwealth, the plaintiff, having taken it with no notice of the illegality, can maintain this action, and we are all of opinion that he can.

The principle upon which this defence is authorized is that a party cannot recover who is in the wrong himself. It is sometimes said that he cannot give a better title than he himself holds. But this is not true. In the case of a conveyance of real estate to defraud creditors, the grantee cannot hold, but one who takes it from him without notice may. But the law goes further in favor of commerce, and gives a high degree of character and honor to bills of exchange and promissory notes in the hands of an indorsee without actual or constructive notice of anything affecting their validity or credit. If he takes it overdue, that should put him on inquiry why it had not been paid. And it must be taken in the ordinary course of business, and not under unusual circumstances.

This general rule is taken with some exceptions. The provisions of some statutes against usury and gaming made notes given in violation of the statute void, even in the hands of an indorsee. Kendall v. Robertson, 12 Cush. 158. Bowyer v. Bampton, 2 Stra. 1155. But in those cases the statute declared that the note should be absolutely null and void, to all intents and purposes, or, as is sometimes said, applied to the contract and not to the party. Without citing numerous authorities, the recent case of Williams v. Cheney, 3 Gray, 222, is precisely in point. Judgment for the plaintiff.