Case Name: CORNELIUS W. CARNRIGHT, Respondent, v. MORGAN GRAY and WILLIAM FRELIGH, Executors of the Last Will and Testament of SAMUEL P. FRELIGH, Deceased, Appellants
Court: New York Supreme Court
Jurisdiction: New York
Decision Date: 1890-09
Citations: 64 N.Y. Sup. Ct. 518
Docket Number: 
Parties: CORNELIUS W. CARNRIGHT, Respondent, v. MORGAN GRAY and WILLIAM FRELIGH, Executors of the Last Will and Testament of SAMUEL P. FRELIGH, Deceased, Appellants.
Judges: 
Reporter: Supreme Court Reports (Hun)
Volume: 64
Pages: 518–532

Head Matter:
CORNELIUS W. CARNRIGHT, Respondent, v. MORGAN GRAY and WILLIAM FRELIGH, Executors of the Last Will and Testament of SAMUEL P. FRELIGH, Deceased, Appellants.
Consideration of a note — burden of proof in respect thereto.
An action was brought upon the following promissory note:
“Quarryville, September 2, 1871.
“Thirty days after death I promise to pay to Cornelius W. Carnright fifteen hundred dollars, with interest. “ SAMUEL P. PRBLIGPI.”
to which a defense was interposed denying that the note had been made, and alleging that there was no consideration therefor.
The' plaintiff upon the trial rested his case without proving any consideration for the instrument.
Upon a motion made upon the trial for a nonsuit, the trial court held that, if the note was genuine, there was a presumption of a consideration, and that the burden rested upon the defendants to show that it was without consideration; that the absence of words of negotiability or words expressing a consideration did not change the rule.
Held, that although, if the fact of the existence of the consideration is assailed by evidence tending to disprove it, the burden of establishing the consideration upon the whole case may rest with the plaintiff, yet where there is no evidence to disprove the existence of a consideration, the note itself is prima facie evidence of its existence.
That, although the note was non-negotiable, it came within the provision of the statute (3 and 4 Anne, chap. 9,1704 ; 1 R. L., 151; 1 R. S., m. p. 768, §§ 1-4) to the effect that a note in writing made and signed by any person whereby he shall promise to pay to any other person, or his order, etc., any sum of money, “shall have the same effect and be negotiable in like manner as inland bills of exchange, according to the custom of merchants.” (Learned, P. J., dissenting.)
That the words “ value received” do not constitute an essential part of a promissory note.
Appeal by the defendants from a judgment of the Supreme Court, entered in the office of the clerk of the county of Ulster on the 2d day of January, 1890, and also from an order denying the defendants’ motion for a new trial made upon the minutes of the court.
The action was tried at the Ulster County Circuit before the court and a jury, and a verdict -was rendered in favor of the plaintiff for $3,395.15.
The action was upon a promissory note as follows :
“Quarryville, September 2, 1871.
“ Thirty days after death I promise to pay to Cornelius "W. Cam. right fifteen hundred dollars, with interest.
“ SAMUEL P. ERELIG-I-I.”
The defense was a denial that the testator made the note, and the answer further alleged that there was no consideration therefor.
Peter Ocmtine, for the appellants.
F. L. Westbrook, for the respondent.

Opinion:
Landon, J.:
The jury decided the signature to be genuine upon testimony which, no doubt, admitted of a decision either way. This issue was sharply litigated. In the absence of any erroneous rulings we ought not to set aside the verdict upon this issue.
The plaintiff in the first instance rested his case without showing any consideration other than that which the note and his possession and production of it imported. The trial court refused to nonsuit the plaintiff, and held that, if the note was genuine, there was a presumption of consideration sufficient to authorize a recovery, and that the burden rested upon the defendants to overthrow it.; that the absence of words of negotiability, or expressing a consideration, did not chapge the rule. The defendants excepted.
Testimony was then given by the defendants tending to show that it was improbable that the piaintiff had any money to loan, or that the testator would have borrowed it; that the parties were unfriendly to each other. The plaintiff then adduced some testimony tending to impair this position of the defendants. The plaintiff did not attempt to show what the actual consideration was.
The court charged the jury that the note, if genuine, imported a consideration, and that the burden rested upon the defendants to show that it was without consideration.
Undoubtedly the rule is that the plaintiff by producing the note and proving the signature makes out a prima faeie case of consideration, and, if nothing more is offered, is entitled to recover; but if this prima facie case is assailed by evidence tending to die- prove it, tlie burden of establishing the consideration upon the whole case rests with the plaintiff. (Perley v. Perley, 144 Mass., 104 ) "When the transaction which resulted in giving the note is disclosed by the evidence, it is plain that the question of consideration should be determined upon the actual facts instead of upon the presumption which the note affords. (Bruyn v. Russell, 52 Hun, 17.) But in the present case the evidence does not disclose the transaction which resulted in giving the note. Its tendency, so far as it has any, is to show that it is improbable that the parties should have had such dealings with each other as to result in this note or any other like it. This evidence goes to the genuineness of the note, not to its consideration. But the jury have found the note to be genuine. There is nothing in the testimony, assuming the note to be genuine, that would sustain a verdict that there was no consideration. The evidence tends to show that the testator would not have given the plaintiff a note except upon consideration. The appeal thus depends upon the question whether this note on its face imports a consideration.
The note in question contains no words of negotiability. It is, therefore, not negotiable. (McMullen v. Rafferty, 89 N. Y., 456; Cromwell v. Hewitt, 40 id., 491.) Non-negotiable notes differ from negotiable ones in the particular that the indorser is regarded as a maker or guarantor, and not as a simple indorser (same cases); also in the further particular that the equities between the parties are not cut off by transfer to a bona fide purchaser for value before maturity. (Maule v. Crawford, 14 Hun, 193; Lee v. Swift, 1 Den., 565; Barrick, v, Austin, 21 Barb., 241.)
But they are regarded as promissory notes under the statute of 3 and 4 Anne (ch. 9, 1704, enacted in this State in 1801; 1 R. L., 151); and in the Revised Statutes (vol. 1 m. p. 768, § 1-4) as follows:
Sec. 1. "All notes in writing, made and signed by any person, whereby he shall promise to pay to any other person, or his order, or to the order of any other person, or unto the bearer, any sum of money therein mentioned, shall be due and payable as therein expressed ; and shall have the same effect, and be negotiable, in like manner, as inland bills of exchange, according to the custom of merchants."
§ 4. " The payees and indorsees of every such note payable to them or their order, and the holders of every such note payable to bearer, may maintain actions for the sums of money therein mentioned, against the makers and indorsers of the same respectively, in like manner as in eases of inland bills of exchange, and not otherwise."
Before the statute of Anne, inland hills of exchange and promissory notes payable to the order of the payee, were, by the custom of merchants, negotiable. "With respect to inland bills of exchange, it was held that the indorsee could recover of the maker or acceptor, as the case might require, and that the custom of merchants had become the common law. It was héld the same way in several cases with respect to promissory notes, but in Clerke v. Martin (2 Ld. Ray., 757; 1 Salk., 129), Lord IIolt, C. J.,held that the merchants could not change the law; and in Potter v. Pierson (2 Ld. Ray., 759; 1 Salk., 129), Lord Holt held that "this custom to oblige one to pay by note without consideration is void and .against law."
The statute of Anne was enacted to reverse the ruling of Lord Holt, and to place promissory notes upon the same footing as inland hills of exchange, with respect to their negotiability and effect. The indorsee or transferree can recover upon them. See Dunlop v. Silver (1 Cranch Rep., 367), for a full exposition of the law and •cases leading to the statute of Anne. The sections of our Bevised Statutes above quoted are a substantial re-enactment of the statute of Anne. Both statutes, by their terms, refer to negotiable notes. They shall " be due and payable as therein expressed." Nothing is said in the statute about consideration, and hence the notes need recite none. The English courts, however, regarding the statute as remedial, extended the benefit of it beyond its literal terms and held that non-negotiable notes came within it, and that the payee could maintain an action within the statute against the maker. (Kyd on Exchange, 65, published in 1790; Smith v. Kendall, 6 Term Rep., 123; S. C., 1 Esp., N. P. C., 231; Burchell v. Slocock, 2 Ld. Ray., 1545.) That is to say, the payee could declare upon the note under the statute, instead of declaring upon the consideration or transaction which led to the giving of the note. If the non-negotiable note was within the statute, it imported a consideration without reciting it. Such being tlie rule in England, it seems to have been assumed to be tlie rule in this State.
In Downing v. Backenstoes (3 Caines, 137), tlie note was nonnegotiable and was declared upon as within tlie statute. The defendant demurred upon the ground that the note was not. within the statute, and that, therefore, the declaration was bad because it did not allege tlie transaction and consideration upon which the note was given. The report states that counsel for defendant confessed that if the case were to be determined on the English decisions it would be against him, but if it were res integra in this court, he had much to say. The court said: " The very point was settled in Green v. Long, April Term, 1798, in conformity to the adjudications in Westminster Hall. Judgment for the plaintiff."
We understand that the rule thus announced has ever since been followed in this State without question. (The President, etc., v. Hurtin, 9 Johns., 217; Kimball v. Huntington, 10 Wend., 675; Paine v. Noelke, 53 How. Pr., 273; 3 Kent. Com., 77.)
The same rule prevails in Massachusetts. (Townsend v. Derby, 3 Met., 363: Dean v. Carruth, 108 Mass., 242.) The statute of Anne, though not enacted in that State, seems to be regarded as declaratory of the common law. (Richards v. Barlow, 140 Mass., 218.)
No definition of a promissory note requires the use of the words "value received." It is an unconditional promise in writing to pay a specified sum of money to another at some time certain to arrive. (Buller on Trials, 272 [edition of 1788]; 2 Black. Com., 467; 3 Kent, 75; Kyd on Exchange, 18.) This definition, in substance, is in all elementary books. Negotiability is not an essential quality of a promissory note. (Sibley v. Phelps, 6 Cush., 172.) Of course, if both negotiable and non-negotiable notes are within the statute, neither needs the words " value received." Yery j>ossibly different rules prevail in different States. As was said by counsel in Downing v. Backenstoes (supra), if the question were res integra it this court, much could be said, but it seems to have been so early and positively settled that very little can be found in our reports upon the subject.
Judgment affirmed, with costs.
Mayham, J.:
Section 1 of title 2 of chapter 4, part 2 of the Revised Statutes (vol. 3, p. 2242 of 7th ed. of Banks' R. S.), which is a transcript of 1 Revised Laws, 151, passed in 1801, and which, in substance, re-enacts chapter 9 of 3 and 4 Anne, passed in 1704, seems broad enough to embrace both non-negotiable and negotiable promissory notes, and as that part of the section relating to non-negotiable notes is connected to the part of the same section relating to negotiable notes disjunctively, either non-negotiable or negotiable notes are promissory notes within that section, and if we read the section leaving out all that part which relates to negotiable notes or those payable to order, we will have an instrument containing all the elements of a non-negotiable promissory note. The section would then read : " All notes in writing made and signed by any person, whereby he shall promise to pay to any other person any sum of money therein mentioned, shall be due and payable as therein expressed; " by section 4 of the same title, if we read the same as it relates to the maker and payee only, we will have this provision: " The payees may maintain actions for the sums of money therein mentioned against the makers." Tested by this reading of the statute, we would find in the note in suit all the statutory elements of a promissory note; and it will be observed that as the provisions of the first section are connected by the disjunctive " or," no misinterpretation of the whole section is effected by reading the same in the manner above indicated. If, then, this is a promissory note, neither words of negotiability or expression of a consideration upon its face are necessary as between the maker and payee to authorize a recovery. It is an unconditional promise in writing to pay a specific sum of money to another at a time certain to arrive, which completely answers the definition of a promissory note.
In Paine v. Noelke (53 How. Pr., 272) it was held that a note not negotiable imported a consideration, though none was expressed, and might be sued on without alleging or proving a consideration.
I think the trial judge committed no error in his charge or on the motion for nonsuit in holding that this note imported a consideration, although none was expressed upon its face, and it was non-negotiable, and that the judgment should be affirmed.