Case ID: nc_58/html/0164-01.html
Source: Caselaw Access Project
Author: {"author": "B&ttle, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

DIBBLE & BROTHERS against SCOTT & BROTHER AND WIELL & ANATHAN.
    Where a party bought an inland bill of exchange bona fide and in the regular course of business, but without endorsement from the payee, and brought a suit, at law, in the name of the payee, to his use, against the drawer, it was Held that, although the drawer and payee both alleged the instrument was forged, on such payee’s receiving from the beneficial claimant a bond to indemnify him, he would be restrained from dismissing the suit, at law, and that the defendant would be restrained from using a release in that Court, until the question, as to genuineness of the paper, might be tried.
    Cause removed from the Court of Equity of Lenoir county.
    The bill alleges, that in the regular course' of business and bona fide, the plaintiffs obtained from one Charles Eaton, an inland bill of exchange, drawn by the defendants, Scott & Brother for $259, on Lamont & Monk, of Wilmington, drawn in favor of Weill & Anathan, payable sixty days afterdate, and dated at Wilmington, April 20th, 1857, which said bill is endorsed by Daniel Perry, E. B. Harrison and Bryan Quinn; that at the maturity of the said bill, they presented it to Lamont & Monk, who refused to pay it, because, as they said, they were so instructed by the defendants, Scott & Brother. The plaintiffs having made demand of Scott & Brother, and given notice to the endorsers, brought suit, at law, in the name of Weill & Anathan, to their use, against the defendants, Scott & Brothei, and the endorser, Quinn, and that the same is still pending in the County Court of Lenoir; that the defendants, Scott & Brother, have procured from Weill & Anathan, a release of the said cause of action, and an authority to have the said suit, at law, dismissed; that they have pleaded the release aforesaid to their cause of action, and threaten to have the same dismissed, by virtue of the said written authority, obtained from defendants, Weill & Ana-than. The prayer is for an injunction to restrain the defendants, Scott & Brother, from setting up the said release in the Court of Law, and to forbid the said Weill & Anathan from dismissing the said suit, at law. The injunction issued in vacation.
    The defendants, Scott & Brother, answered, that they-did mot make any such bill of exchange to Weill & Anathan, and the latter answer, that they never had such a bill, and they both say the one in question is a forgery, and, as they believe, perpetrated by Charles Eaton, from whom plaintiffs got it. The account, which they give of the transaction is, that Scott & Brother made a bill of goods with Weill & Anathan, and took a note of hand for the amount, ($259) and it was agreed, that if this note was not paid, at maturity,'in cash, it was to be met by a bill of exchange on Lamont & Monk at sixty days; that the blank form of such a bill was prepared at Wilmington, where Weill & Anathan resided, anS taken home by the defendant, JT. F. Scott, to be used as above stated, in case it became necessary ; but that they paid off the note at maturity, and having no occasion to use the bill of exchange, had not signed the same; that they (Scott & Brothel’) had loaned the blank form, thus prepared, to a neighbor, by the, name of Williams, as a guide to him in a matter of business, and that Eaton, who was his clerk, stole the same, forged the names of Scott & Brother to it, and put the same in circulation, and lias since fled the country for that and similar crimes. They both answer that the release was given, because there was mo debt due from Scott and Brother to 'Weill & Anathan, and that it was no more than equity and justice, that the same should be^ used to defeat the said action. Weill & Anathan admit, that they have given a written authority to the clerk to dismiss the suit, and that this was done for the reasons above stated. Eeplication tO' the answer.
    O-n coming- in of the answers,, the defendants moved to dismiss the bill for the want of equity, and to disso-ve the injunction, and the cause being set down for hearing on the bill, answer and on the motion to dissolve, was sent to this Court.
    No. counsel appeared for the plaintiffs in this Court.
    Mediae, for the defendants.
   B&ttle, J.

It is a well settled; rule of the Court of Equity that it will restrain by injunction the assignor of an, equitable claim, from dismissing a suit at law, brought by the as-signee in h-is- name Deaver v. Eller, 7 Ired. Eq. 24; 2 Story Eq. Jur. sec. 1040-1050. The present is not a case of such assignment, but it is- one in which the plaintiffs allege that they purchased bona fide, in the regular course of their business, an inland, bill of exchange purporting to have been drawn by the defendants Scott & Brother on Larnont’& Monk of Wilmington, and payable to the defendants Weill & Ana-dian, which was not endorsed by the-said payees, bat was endorsed by other persons to the plaintiffs' for value paid by them. The defendants, Scott & Brother, allege that the bill of exchange is- a forgery and the other defendants, Weill & Anadian, deny that they e-ver held such a bill of exchange as payees, and, of eonrse, could never have put it in circulation, and they executed to Scott & Brother a release of all their interest in it. But notwithstanding these answers, we think that the- plaintiffs have a right upon executing to the defendants, Weill & Anathan, a suitable and sufficient bond of indemnity to institute and carry on a suit at law in their names against Scott & Brother, to try the question whether the instrument in controversy is a forgery or not. Weill & Ana-than, upon having such an indemnity provided for them, cannot have any direct interest in the event of the suit; and the other defendants ought not to be allowed to use the release to avoid their responsibility upon the bill of exchange if it were not in fact a forgery, and if they be liable to the plaintiffs upon it according to the law merchant. As between the plaintiffs and these defendants, so far as the pleadings show, the question is purely a legal one, and the. latter ought to be restrained from insisting on the release for the purpose of preventing a trial at law.

A decree may be drawn upon the principles herein declared.

PeR CubxaM, Decree accordingly.