Case Name: BENNETT v. OTT
Court: Supreme Court of South Carolina
Jurisdiction: South Carolina
Decision Date: 1927-10-24
Citations: 141 S.C. 397
Docket Number: 12294
Parties: BENNETT v. OTT
Judges: Mr. Chief Justice Watts and Messrs. Justices BeEasE, StabeEr and Carter concur.
Reporter: South Carolina Reports
Volume: 141
Pages: 397–406

Head Matter:
12294
BENNETT v. OTT
(139 S. E., 853)
Messrs. W. D. Bennett, Salley & Salley, and Wolfe & Berry, for appellant,
Messrs. Lide & Beider, for respondent,
October 24, 1927.

Opinion:
The opinion of the Court was delivered by
Mr. Justice Coti-iran.
This is an action by the plaintiff upon a negotiable promissory note, executed by the defendant, payable to his own order, indorsed by him in blank, delivered to one J. D. Shuler, and by him transferred to the plaintiff, for value before maturity.
The note is dated May 16, 1924, due six months after date, for $625, with interest from date at 6 per cent, per annum, and with 10 per cent, attorney's fees, upon the usual conditions. It was transferred by the indorsee, Shuler, to the plaintiff, a few days after its execution, for value.
The defendant alleges that the note was given for stock in the Carolina Remedies Company, a vessel which began its voyage upon smooth seas and with favoring winds, but later has sunk' into "the port of missing traders"; that his subscription was obtained by willfully false representations; and that the note was without consideration. He also alleges that the plaintiff had notice, before he traded for the note, of the circumstances under which it was given.
The defendant attempted to establish this last allegation . by testimony to the effect that, before the plaintiff traded for the note, he sent one of his friends, Pet C. Way, with the note, to the defendant, to inquire whether it was all right or not, that he told the emissary to tell the plaintiff "not to buy the note, as I did not have nothing for the note." The plaintiff admits that he sent Way with the note to the defendant, but declares that it was only for the purpose of assuring himself of the genuineness of the defendant's signature, which was not familiar to him; that Way reported that the defendant admitted his signature and his liability on the note. In this he was corroborated by Way.
The case was tried before his Honor County Judge Moss and a jury: He gave an exceedingly clear charge, except in a particular to be noted, which sent the issue of fact above indicated fairly to the jury. They found for the defendant, and the plaintiff has appealed.
If the jury believed the testimony in behalf of the defendant, the plaintiff had express notice that the defendant had a valid defense to the note, and could not therefore claim the benefit of a holder in due course. Their verdict shows that they did believe it, and that should end the controversy, unless harmful error in the Judge's charge may be shown.
The plaintiff contends that such error is shown in the charge that the plaintiff assumed the burden of proving that, when he traded for the note, he had no notice of the alleged infirmity.
In the case of Farr v. St. George, 128 S. C., 67; 122 S. E., 24, the Court said: " That evidence directed to establishing those defenses would not be received until the defendant had introduced sufficient evidence, tending to establish that the plaintiff was not a holder in due course, to require submission of that issue to the jury"; from which it follows that, when the indorsee or transferee of a negotiable promissory note offers testimony tending to show that he acquired ownership of the paper before maturity for value, the burden is then thrown upon the maker to show that the indorsee or transferee had notice of the infirmity upon which he relies to defeat liability.
This principle was again and again declared by the presiding Judge; the portion of the charge complained of was plainly an inadvertence, which could not reasonably have effaced from the minds of the jury the correct principle announced. . Moreover, the issue of fact was so sharply drawn that we cannot think that such inadvertent statement of the burden of proof could have prejudicially affected the rights of the defendant.
Let the charge be reported.
The judgment of this Court is that the judgment of the County Court be affirmed.
Mr. Chief Justice Watts and Messrs. Justices BeEasE, StabeEr and Carter concur.