Case Name: SECURITY NATIONAL BANK OF FARGO, NORTH DAKOTA,. a Corporation, Appellant, v. P. M. MATTSON and H. B. Johnson, Respondents
Court: North Dakota Supreme Court
Jurisdiction: North Dakota
Decision Date: 1924-12-05
Citations: 51 N.D. 893
Docket Number: 
Parties: SECURITY NATIONAL BANK OF FARGO, NORTH DAKOTA,. a Corporation, Appellant, v. P. M. MATTSON and H. B. Johnson, Respondents.
Judges: Christianson, Birdzell, Nuessle, and Johnson, JJ., concur.
Reporter: North Dakota Reports
Volume: 51
Pages: 893–897

Head Matter:
SECURITY NATIONAL BANK OF FARGO, NORTH DAKOTA,. a Corporation, Appellant, v. P. M. MATTSON and H. B. Johnson, Respondents.
(201 N. W. 690.)
Opinion filed December 5, 1924.
William Maloney, and Lemlce & Weaver, for appellant.
Knauf & Knauf, and Edgar P. Malison, for respondent.

Opinion:
Bronson., Ch. J.
This is an action upon a promissory note against the maker and endorser. Johnson, the endorser, is in default. Defendant Mattson, the maker, interposed an answer setting forth a conditional delivery. Upon trial to a jury verdict was returned in defendant's favor. Plaintiff has appealed from the judgment.
The facts are: — Defendant Mattson made two promissory notes to one Dowling for about $3200.00 on account of the first premium for a life insurance policy. Shortly after these notes were made and before their maturity, Dowling sold and transferred the notes to defendant Johnson. Later, and before their maturity, defendant Johnson placed such notes with plaintiff bank as collateral security for an indebtedness owing by Johnson to plaintiff. When the notes matured, negotiations were had among the parties concerned for their renewal. One new note was given by Mattson for $3200.00, dated March 31, 1922, payable to defendant Johnson, and again placed with plaintiff bank.
At the trial evidence was adduced by defendant Mattson to the effect that this note so renewed was delivered to defendant Johnson with the knowledge and acquiescence of plaintiff upon the agreement and condition that the note would be void and would be returned if a life insurance policy should not be issued to defendant Mattson according to him the privilege of borrowing thereupon 90% of the premium. Defendant Mattson testified that such policy never was delivered to him pursuant to the condition; that certain policies were tendered to him but he refused to receive them for the reason that they did not comply with the conditions upon which the note Avas given. Plaintiff's evidence denied such agreement and conditional delivery. The trial court submitted to the jury the issues whether the plaintiff was a holder in due course and whether there was a conditional delivery of the note.
Upon this appeal it is the contention of the appellant that the trial court erred in receiving evidence concerning this conditional delivery and instructing the jury thereupon for the reason that plaintiff, upon the record, Avas a holder in due course of the original notes and as such was a holder in due course of the renewed note; that, in consequence, the evidence concerning the oral agreement for a conditional delivery was inadmissible; further that there was no consideration for such oral agreement which affected and concerned a conditional delivery.
We are of the opinion that appellants contentions are without merit. This is an action upon the renewal note and not upon the original notes. Defendant's defense is that this renewal note never became effective by reason of its conditional delivery. Defendant's defense is, further, that both the payee in the renewal note, and plaintiff as the holder thereof, were specifically parties to the agreement that provided for a conditional delivery. In consequence the trial court properly submitted to the jury the specific question whether the renewal note was conditionally delivered and whether the same ever became effective as such. See § 16, Unif. Neg. Inst. Act; Comp. Laws, 1913, § 6901. See First Nat. Bank v. Miller, 46 N. D. 551, 179 N. W. 997.
The judgment is affirmed.
Christianson, Birdzell, Nuessle, and Johnson, JJ., concur.