Case Name: Edwin M. Lewis, Trustee v. Alexander R. Shepherd
Court: Supreme Court of the District of Columbia
Jurisdiction: District of Columbia
Decision Date: 1881-03-02
Citations: 1 Mackey 46
Docket Number: No. 13,735
Parties: Edwin M. Lewis, Trustee v. Alexander R. Shepherd.
Judges: The Chief Justice and. Justices Wylie and Hagnek sitting-.
Reporter: Reports of cases argued and determined in the Supreme Court of the District of Columbia (District of Columbia - reported by Mackey)
Volume: 12
Pages: 46–51

Head Matter:
Edwin M. Lewis, Trustee v. Alexander R. Shepherd.
At Law.
No. 13,735.
Decided March 2, 1881.
The Chief Justice and. Justices Wylie and Hagnek sitting-.
1. The court in General Term will hear a motion for a new trial upon a bill of exceptions, notwithstanding no motion for a new trial had been made in the court below.
2. An alteration by the endorsee or his agent increasing the rate of interest upon a promissory note if made without the knowledge or consent of the endorser and after it has passed out of his hands, is a serious and material change in the promise, and is sufficient to discharge him.
3. A declaration in assumpsit consisted of a special count against the defendant as endorser of a promissory note, and also of the common money counts, having annexed thereto, as the only bill of particulars, the note sued on, the defendant being also the maker thereof. On the trial the note was shown to have been materially altered, as to the rate of interest, by the endorsee or his agent, after endorsement, and without the endorser’s knowledge or consent.
Held, That by reason of the alteration of the note there could be no , recovery upon the special count. Neither could there be a recovery - upon any of the common counts for, in addition to the infirmity of an altered note as a bill of particulars, a liability as endorser does not imply a further liability by reason of the money that was advanced upon the note.
STATEMENT OF THE CASE.
Motion for new trial upon exceptions.
The plaintiff, trustee of the estate and effects of Jay Cooke & Co., bankrupts, and late bankers, in Washington, JJ. C., sued the defendant, Alexander E. Shepherd, in assumpsit upon a promissory note made and endorsed by him to Jay Cooke & Co. before they became bankrupts. The declaration consisted of a special count against the defendant as endorser, with the common money counts added. To the latter-was annexed, as a bill of particulars, the note sued on, as follows:
“ Particulars of Demand.
“ $2,500. Washington, D. C., December 6, 1872.
“One day after date I promise to pay to the order of myself, two thousand five hundred dollars, at the banking house of Jay Cooke & Co., value received, and interest at 9 per cent.
“Alex. E. Shepherd.
“ Endorsed : Alex. E. Shepherd.”
The defendant pleaded :
“ Not indebted as alleged.”
“ Did not make the promissory note,”
On the trial, William M. Tenney, a witness for plaintiff, testified, “ that he was connected, during the month of December, 1872, with the banking house of Jay Cooke & Co., as confidential clerk and manager; that this note was received from the defendant by Mr. TIenry D. Cooke, one of the firm of Jay Cooke & Co., and he gave him the'money for it. When I saw the note I objected to the rate of interest, which, in the way the note was drawn, would have been only 6 per cent. I therefore called Mr. Cooke’s attention to it, and told him we should have a higher rate of interest than that. He said that the understanding with Mr. Shepherd ivas that he was to pay 9 per cent, interest on the note. I therefore added the words, “ at nine per cent,” as a memorandum for my guidance when the note should be paid.”
The signature and endorsement of the note^ having been proved to be in the handwriting of the defendant, the plaintiff offered the same in evidence, but the court refused to admit it -for any purpose. Whereupon the plaintiff, to establish his claim under the common money counts, offered to prove from the cash-book of Jay Cooke & Co. that, on the 6th day of December, 1872, a note of Alexander E. Shepherd for $2,500 -was negotiated by Jay Cooke & Co., and $2,500 paid by them on the note. To this the defendant objected, but the court overruled the objection; the defendant excepting thereto. The plaintiff then made good his offer and rested his case. Whereupon the defendant, after having testified that he received no consideration for the note, but received - the money thereon for a third party to w'hom he paid it over in the bank, and that the words, “ at 9 per cent.” had been added to the note by some other person and without his knowdedge or consent, and that the same had been done after it had passed out of his hands, rested his defense, and prayed the court to instruct the jury that—
“If the jury believe from the evidence that the note declared on, when made and passed to Jay Cooke & Co., did not bear the words, £at 9 per cent.’ and that in consideration of said note, the said Jay Cooke & Co. paid the sum of $2,500 ; and that thereafter the said Jay Cooke & Co. altered or caused to be altered said note, by adding the said words and figures,£ at 9 per cent.,’ the plaintiff is not entitled to recover upon either count of the declaration.”
The court refusing to grant this prayer, the defendant, after excepting, asked the following :
“ If the jury believe from the evidence that the note sued on was originally drawn with the words ‘ and interest ’; and, after being delivered to Jay Cooke & Co., (if it was so delivered) it was altered by said Jay Cooke & Co., or by their agents, upon misrepresentations made to Tenney by ITenry D. Cooke, by adding after those words, the words and figures ‘ at 9 per cent.,’ with fraudulent intent to measure and change the liability of the defendant, and without his knowledge or consent, then the plaintiff is not entitled to recover.”
Which prayer the court also refused, the defendant noting his exception.
The court thereupon instructed the jury that the note set forth in the special count of the declaration, having been altered in a material matter had been ruled out of the case and excluded from their consideration, but that the case was submitted to them on the evidence as to the reception of the money by the defendant and from whom he received it.
■ Verdict for the plaintiff for $2,500 without interest.
A motion for a new trial was not made by the defendant within four days after the verdict, nor was it ever made in the court belown Accordingly, -when the defendant tendered his bill of exceptions- to the court for its approval, the plaintiff interposed and objected to the signing of the same on the ground that, as no motion for a new trial had been made under the 60th and 61st Rules of Practice, the justice presiding had no power to sign and seal the exceptions. But the court overruled (pro forma) the objection of the plaintiff, and signed and sealed the exceptions. To which ruling the plaintiff', before the bills of exceptions were signed and sealed, excepted, the court signing and sealing the same. ■
■WALTER Dayidge for plaintiff.
A. 0. Bradley and W. F. Mattingly for defendant:
1. The Rules of Practice do not require any motions for new trials to be made within four days after verdict, except such as are to be heard by the justice who tried the cause ; they make no requirement as to the time or place of filing a motion for a new trial on a bill, of exceptions. Rules 61-64,. A motion made in the court in General Term is sufficient., and such motion was filed on the first day of the term. McPherson vs. Cox, Wash. L. R., Vol. 6, p. 255. O’Neal vs. The .District of Columbia, lb., 332. In this cause judgment was entered upon the same day with the verdict, April 21, 1830, the bill of exceptions was filed May 8, and on May 15 an appeal to this court was entered. Upon this appeal the •court will consider all questions presented by the' bill of exceptions. R. S. I), C., sec. 772. Rules of Practice, 91. Our statute is similar to the New York system and “ draws its inspiration ” therefrom, (O’Neal vs. District of Columbia, supra), and such practice is sustained there. Morrison vs. N. Y. & N. PI. R. R.-, 32 Barb., 568 ; Watson vs. Seri ven, 7 How., Pr. 9 ; 20 How. Pr., 257 ; 11 Plow.-, Pr. 285 : 4 E. D. Smith, 510.
2. The alteration was material, and voided the note. 2 Parsons on Notes and Bills, 545-9 ; 2 Dau’l Neg. Instr., ■338-848 ; Lee vs. Starbird, 55 Me., 491 ; Neff vs. Plomen 63 Pa. St., 330 ; Fay -vs. Smith, 1 Allen, 477 ; McGrath vs, Clark, 56 N. Y., 36 ; Evans vs. Foreman, 60 Mo., 449, 452 ; Fulmer vs. Seitz, 68 Pa. St., 237. The question of materiality was for the court to determine. Wood vs. Steele, 6 Wall-., 80.
■3. The alteration was in the interest of the bank, was made by the confidential clerk and manager of the bank, upon consultation with one of the firms, and was the act of the bank. The note passed into the firm’s assets, and is sued upon in its altered state, If not the act of the1-bank and if clb-rye' without the- knowledge or consent of the firin, the burden* was upon-thfe plaintiffs to show it. 2,Pars.-N.-&'B., 574-7 p Heffner vs. 'Weimrich, 32 Pa.. St., 4-23 Neff vs. Horner.. supra ; Davis vs. Carlisle, 6 A-la.,- 707 ; Henman vs. Dickinson, 5 Bing., 183 ; Simpson vs. Stackhouse, 9- Barr-, 186.
4. If the alteration was mad'e with a fraudulent intent it' vitiated the entire transaction and- the plaintiff" was not-entitled to recover either upon th® note or the common* counts*. 1 Pars. N..& B.; 1 Daniels’ Neg,. In.¿ Smith vs. Mace,, 44 N. PI.-,- 568- The question of fraud ancl intent was a. question for the jury. Bowers vs. Jewell,, 2- N. H.,- 543 p Bavis vs. Carlisle, supra ;*. Jones vs- Ireland,- 4 Iowa, 70 Beaman, vs-. Bussell,- 20- N't., 215-.

Opinion:
Mr. Chief-Justice Camber,
delivered- the opinion of the: • court.
Edwin M. Lems, trustee- of the estate and: effects of Jay' Cooke & Co., brings this action, in assumpsit upon a promissory note executed by the defendant, Alexander R. Shepherd,, to himself arid by him endorsed.- In the hands of Jay Cooke & Co-the note underwent a very serious alteration.. As originally executed it was a note without interest. As-sued upon and presented in proof it was a note with interest-at 9 per cent., a very material and serious change in the* promise-; a change of such' a character and import that the-justice trying the case would not allow the note to-be given; in evidence as a promise of the defendant- The note having* been thus taken fr&m the consideration of the jury, the* special count in the- declaration predicated upon it -was1 abandoned, and the plaintiff passed* over to* the common-count for money bad and received- Here tli'e court permitted the plaintiff to enter the field'of proof, to* substantiate* bis claim,-which was based, we suppose,upon the consideration; of the note ; and- the first difficulty presented in considering; the ruling of the court below, is that, attending the common count, was- a hill of particulars consisting of nothing more* than this very note which had been made- the subject of the* special count. Now how this note could be good for nothing in one place and good for something in another is the puzzle .that we have had to resolve,; and we have -come to the con-•elusion that the common counts with this note annexed as ;a bill of particulars is a Little worse 'than the special count •; for it is patent from the testimony in the ease that the defendant's liability was a liability under his undertaking as an endorser, which does not imply a further liability by reason •of the money that was advanced upon the note. In addition to which the common count upon which the recovery was had was damaged with the same Infirmity, by reason -of ;the altered note as a bill of particulars, .that existed in the special count predicated upon this same' note. We consider these objections fatal.
The case is remanded for a new trial, with liberty to the plaintiff to amend as he may be -advised.