Case Name: First National Bank of Lawrenceburgh v. Lotton
Court: Supreme Court of Indiana
Jurisdiction: Indiana
Decision Date: 1879-11
Citations: 67 Ind. 256
Docket Number: 
Parties: First National Bank of Lawrenceburgh v. Lotton.
Judges: 
Reporter: Indiana Reports
Volume: 67
Pages: 256–257

Head Matter:
First National Bank of Lawrenceburgh v. Lotton.
Promissory Note Payable in Bank.— Action by Endorsee. — Fraud on Maker no defence. — -Pleading.—Fraud practised by the payee, on the maker, in obtaining the execution of a promissory note payable in bank, is no defence to an action thereon by an endorsee who is not alleged not to be a bonafi.de endorsee for value and before maturity.
From the Ohio Circuit Court.
A. C. Downey, D. T. Downey and II. S. Downey, for appellant.
S. H. Stewart, for appellee.

Opinion:
Biddle, J.
Complaint on a promissory note made by the appellee to William Hammond, negotiable and payable at the National Bank of Rising Sun, »Ind., endorsed by Hammond to the appellant.
The answer sets up fraud practised by the payee in procuring the note from the maker, but in no manner impeaches the title to the note in the hands of the endorsee, as an innocent holder for a valuable consideration.
Demurrer to the answer overruled ; exceptions ; issue; trial; verdict and judgment in favor of the appellee; appeal.
The only assignment of error is, overruling the demurrer to the answer. We do not set out the answer at length; it is similar in fact, and the same in principle, as the second paragraph of answer in the case of Nebeker v. Cutsinger, 48 Ind. 436, to which reference may be had. Although no demurrer was filed to the answer in that case, yet the essential facts- averred were found true by a special finding, upon which it was held by this court that judgment should be rendered for the plaintiff, who was an innocent holder of the note for a valuable consideration, notwithstanding the general verdict, which'was for the defendant.
The case of Nebeker v. Cutsinger, supra, was previously supported by the following cases : Hereth v. The Merchants National Bank of Indianapolis, 34 Ind. 380, and Strough v. Gear, 48 Ind. 100; and has since been approved by the following cases : Moon v. Vancuren, 49 Ind. 201; Glenn v. Porter, 49 Ind. 500 ; Riley v. Schawacker, 50 Ind. 592 ; Dutton v. Clapper, 53 Ind. 276 ; Kimble v. Christie, 55 Ind. 140 ; Burns v. Barnes, 58 Ind. 436; Bremmerman v. Jennings, 60 Ind. 175; Bremmerman v. Jennings, 61 Ind. 334; Woollen v. Vankirk, 61 Ind. 497; Woollen v. Ulrich, 64 Ind. 120.
These authorities settle the law in this State, and are in harmony with commercial law throughout the world. They must not be disturbed. The answer in this case constitutes no defence to the note in the hands of an innocent holder for a valuable consideration, which the appellant must be presumed to be until it is otherwise shown.-
The judgment is reversed, at -the costs of the appellee, and the cause remanded, with instructions to sustain the demurrer to the answer, and for further proceedings.