Case Name: Robert Whitesides vs. John Wallace
Court: South Carolina Court of Appeals
Jurisdiction: South Carolina
Decision Date: 1843-12
Citations: 2 Speers 193
Docket Number: 
Parties: Robert Whitesides vs. John Wallace.
Judges: Richardson, O’Neall, Butler, and Wardlaw, JJ. concurred.
Reporter: South Carolina Law Reports
Volume: 29
Pages: 193–196

Head Matter:
Robert Whitesides vs. John Wallace.
1. An action at law may be maintained on a lost note or bill, unless in those cases in which the maker would be liable to one into whose hands the lost note or bill might come. In such case, a Court of Law will not entertain the action.
2. Thus, where a sealed note was lost, and not assigned, it was held, the payee might sue and recover on it; because, if sued on again, the action must be in the name of the payee, to which his recovery would be an effectual bar.
3. Although a sealed note may be assigned, under the Act of 1798, yet the assignee takes it subject to any bona, fide defence which may be set up against the payee.
4. In some cases, this court has taken notice of the equitable rights of a bona fide holder of a sealed note, not assigned, but it has been only so far as to protect the holder against a fraudulent combination of the maker and the payee. ( )
Before Q’Neallj J. at York, Fall Term, 1843.
This was an action of debt, on a single bill, (or sealed note,) which the plaintiff alleged was lost.
The proof was, that a settlement was made between them, on the 23d. of November, 1841, and that the defendant gave his note, under seal, for the balance, which, by the gentleman who drew it, was cut off, backed, and left lying on the plaintiff’s table in his dwelling house.
During the summer of 1842, the plaintiff, and all his family, Were sick. During his sickness his papers were frequently overhauled by members of his family to make settlements with people ; in consequence of this, his papers were scattered about; two of his notes Were found on the floor. Oil examination of his papers, the sealed note, made by the defendant, could not be found. The plaintiff, and his son-in-law, (Whisenhunt,) who drew the note, called on the defendant, and stated to him the loss, and requested payment; he refused, saying he never gave such a note.
A motion was made for a non-suit, which was overruled.
It appeared that the defendant, still denying his liability for the lost note, had confessed two small judgments in favor of the plaintiff.
The case was submitted, as ohe of fact, as to the existence and loss, to the jury, Who were told, if they believed the existence and loss of the sealed note to be proved, that then, it was not necessary to prove the consideration ; that an assignee of the note could maintain an action in his own name, but that against him any defence which would be good against Whitesides, would be good, unless it arose after assignment and notice to the defendant.
The jury were also told, that when the existence and loss of the sealed note were established, the plaintiff could only sue upon it, for the consideration was merged in the higher legal contract. The jury found for the plaintiff.
The defendant appealed, and moved the Court of Appeals for a non-suit, and for a new trial, on the following grounds, viz:
For a non-suit---
1st. Because the plaintiff cannot maintain an action at law on a lost note.
2nd. Because there was not sufficient legal evidence of the loss of the note,
And for a new trial—
1st. The same grounds as taken above for a non-suit, and that the plaintiff had subsequently taken two confessions of judgment against the defendant, omitting this note, before this action was brought.
2nd. Because the court charged the jury, that there was no necessity on the part of the plaintiff to prove the consideration of the note, and that an assignee of this note, as it was a sealed note, could not sue in his own name, and that it would be liable to any defence that could be set up against it, if sued in the name of the payee.
3rd. Because the court charged the jury, that the plaintiff could not count or declare on the cause of action for which this note was given, and that they had nothing to do with the consideration,
Thompson & Smith, for the motion,
cited 1 Brev. Dig. 90 ; 1 Leigh’s Nisi Prius, 469 ; 2 Con. Rep. (by Mill,) 225 ; Bailey, 428 ; Rice Rep. 293.
Clawson, contra,
See on the subject of lost bills and notes, Rowley vs. Ball, 3 Cowen, 303; Pintard vs. Tackington, 10 J. Rep. 104; Champion vs. Terry, 7 E. C. L. Rep. 443.

Opinion:
Curia, per
Evans, J.
The only ground upon which we think it necessary to express an opinion, is the first ground for a nonsuit, which makes the question, whether, upon a lost note, an action at law will lie. In England, the subject of lost notes and bills has been very much discussed of late years, and it seems to be now pretty well settled, that if a lost note or bill be negotiable in its character, as if it be payable to bearer or be indorsed in blank, so that a tona fide holder can compel payment, the only remedy is in equity, upon a tender of sufficient indemnity. But in a late case, 13 Eng. Common Law Reports, 431, Best, Chief Justice said, "there is no decision in which a party has been held responsible in respect of an outstanding bill unindorsed;" and in Leigh's Nisi Prius, 1 vol, 471, where all the cases on lost notes and bills are collected, it is said <!but if a bill or note, transferable by indorsement only, be lost, without being indorsed, the loser may recover either on the instrument or on the consideration ; because, under such circumstances, the defendant could never be called on to pay." In cases where the maker would be liable to one into whose hands the lost note or bill might come, a court of law will not entertain the action. The note, in this case, is a sealed note, which is not a negotiable instrument. It may be assigned, under the Act of 1798, but the assignee takes it subject to any bona fide defence which might be set up against the payee. In this case, so far as appears, the note was not assigned. If ever sued on again, it must be in the name of Whitesides, and this action would be an effectual bar. In some cases, this court has taken notice of the equitable rights of a bona fide holder of such a note, not assigned; but it has been only so far as to protect the holder against a fraudulent combination of the maker and the payee. So many actions at law have been brought in this State on lost notes, that it can hardly now be made a question, whether such an action will lie. There is much good sense in requiring the loser to go into equity, where there is danger of the defendants being made liable a second time, but no such danger exists in this case. The motion must be dismissed.
Richardson, O'Neall, Butler, and Wardlaw, JJ. concurred.