Case Name: Martin Tully, Appellant, v. Nicholas Cotter, Respondent
Court: New York Supreme Court, Appellate Term
Jurisdiction: New York
Decision Date: 1897-11
Citations: 21 Misc. 653
Docket Number: 
Parties: Martin Tully, Appellant, v. Nicholas Cotter, Respondent.
Judges: 
Reporter: New York Miscellaneous Reports
Volume: 21
Pages: 653–655

Head Matter:
Martin Tully, Appellant, v. Nicholas Cotter, Respondent.
(Supreme Court, Appellate Term,
November, 1897.)
Bills and notes — Counterclaim — Payment o£ debtor’s own obligation —■ Consideration for indorsement.
Proof, made in an action, upon the part of the defendant, the maker of a note, that he held another note made by a third person to his order and that of his brother, they constituting a firm which had made a contract with the third person and had only sublet the work under the contract to the plaintiff and another, not having assigned the contract itself, that the note was subsequently transferred by its payees to the subcontractors for their services and that it, after indorsement, was cashed by the defendant for the plaintiff, does not establish any offset or counterclaim available to the defendant; as his acts constitute merely a payment of his own obligation; and plaintiff’s indorsement was made without consideration.
Appeal by plaintiff from a judgment of the justice of the Tenth . ¡District Court dismissing the complaint.
Earley & Prendergast for appellant.
J. Wilson Bryant, for respondent.

Opinion:
Daly, P. J.
The defendant, in and prior to April, 1897, obtained from the plaintiff various sums of money aggregating $86, for which, on April 9, 1897, he gave the plaintiff his promissory note, payable at three months, which was dishonored.' and this action is brought upon it. The defense is that the sums in question were not loans, to defendant, but payments on account of a prior indebtedness upon a note which he held and which was indorsed by plaintiff. There is no proof to sustain such a defense, the defendant's, testimony not even tending to establish that when.he got -the money anything was said about it being by way of payment. . He stated that " when the first fifty" dollars was paid, we were talking about the old note; I asked him for some money and. I got it; a good many things were said." This does not even inferentially support the defense. It is quite evident that, whatever was said on either side about the old note, it could not have been understood, or agreed, that the $50 was payment on account of it, or the defendant would not have subsequently given his note for the $50 and the additional sums obtained. There is besides, no statement by defendant that when the latter sums were obtained anything whatever was said about the old note.
The justice dismissed the complaint and this disposition of the case may have been based upon some finding that defendant had a set-off, or counterclaim, upon the note he held, against the note here sued on. As no objection was interposed to the evidence -offered by him, it must be examined to see what claim he had against the plaintiff. He held, as has beén said, a note indorsed by the latter. It was for $211.75, dated June 26, 1891, payable at three months to the order of " Cotter Brothers," and drawn by Wm. C. Burne. It was indorsed by W. Cotter, Martin Tully and Cotter Brothers.
' As the defendant's firm, " Cotter Brothers," were the payees of the note it. would seem that the plaintiff was not liable to them upon it, as he stood, in regular order, as a subsequent indorser to the payees. It was proved, however, that the amount of the note was paid to him and the other'indorser by the defendant; and it is -claimed that- he became liable therefor as., for a loan or advance, of money, and indorsed the note to secure defendant therefor.
The facts concerning this note were fully proved, and they establish that plaintiff did not indorse the note to secure the defendant, but that the advance of money by the latter to the plaintiff and "William Cotter, the other indorser, was the discharge of defendant's own obligation to them: This is proved by the testi mony of William Cotter who was the defendant's brother, and was called by defendant as his own witness.
It appears that the maker of the note, Wm. C. Burne, gave a contract for certain work to the defendant's firm, Cotter Brothers. The defendant turned the work over to his brother William Cotter, who took this plaintiff, William Tully, in with him to complete it. The payments made by Burne on the contract were made to defendant, who turned the money over' to William and the plaintiff. Burne seems to have recognized no one but defendant and his firm, Cotter' Brothers, in the matter, and when he gave a note for the final payment, made it payable to them. This is the note in suit and defendant cashed it for his- brother William and plaintiff, as he had cashed Burne's checks for prior payments, which checks were all drawn to his order. If it might be inferred that the cashing of the note and the checks was a mere accommodation to William and the plaintiff — that Cotter Brothers, in turning over Burne's contract to them, assumed no responsibility for Burne's payments under it, and that William and the plaintiff looked to Burne, and not to Cotter Brothers, for their money — that inference is rebutted by William's testimony. He says, " I was to look to them for the money in case Burne didn't give it to me." He was called as a witness for the defendant, and his testimony clearly establishes that the latter's firm sublet the work and did not assign the contract. This being so, the discount of the note was not for the accommodation of plaintiff, but to pay defendant's own obligations, and the indorsement by plaintiff was for defendant's accommodation and without consideration.
The proof is altogether in favor of plaintiff, and the judgment in defendant's favor must be reversed.
Judgment-reversed and new trial ordered, with costs to appellant to abide event.
McAdam and Bischoff, JJ., concur.
. Judgment reversed and new trial ordered, with costs to appellant to abide event.