Case Name: Benson v. Gerlach
Court: New York Supreme Court, General Term
Jurisdiction: New York
Decision Date: 1890-12-29
Citations: 12 N.Y.S. 595
Docket Number: 
Parties: Benson v. Gerlach.
Judges: 
Reporter: West's New York Supplement
Volume: 12
Pages: 595–597

Head Matter:
Benson v. Gerlach.
(Supreme Cowrt, General Term, First Department.
December 29,1890.)
Note Pbooübed by Fbaud—Rights of Indobsee.
To entitle the indorsee of a note to recover thereon against the maker, where the evidence shows that the latter was induced to give the note by fraudulent representations, the indorsee must prove that he became a holder of the note for value and without notice. Beady, J., dissents.
Appeal from circuit court, New York county.
Action by William Benson, as surviving partner of the firm of Benson & Brotherton, against Charles A. Gerlach. Defendant appeals from a judgment for plaintiff entered on a verdict directed by the court and from an order denying a motion for a new trial. For former report, see 4 N. Y. Supp. 273,
Argued before Van Brunt, P. J., and Brady and Daniels, JJ.
Hamilton R. Squier, for appellant. C. G. Patterson, for respondent.

Opinion:
Daniels, J.
The evidence was sufficient to justify a jury in concluding that.the defendant was induced to give the note by means of fraudulent representations; and that subjected the plaintiff to the obligation of proving that himself and deceased indorsee became holders for value without notice, before a recovery could legally be directed in their favor. Bank v. Green, 43 N.Y. 298; Harger v. Worrall, 69 N. Y. 370. That proof was not given. Neither did the complaint allege that the note had been transferred to them for value, nor did the answer admit that to be the fact. That the fraud was reasonably well established has been shown by the opinion of Mr. Justice Brady. And it was necessary, before a recovery could be directed, that this other proof should have been added. The exception to the direction of a verdict, as the case then stood, was well founded. The judgment, therefore, should be reversed, and a new trial ordered, with costs to the defendant to abide the result.
Van Brunt, P. J., concurs.