Court Opinion

ID: 6413560
Source: CourtListenerOpinion
Date Created: 2022-06-25 11:54:28.555396+00
Date Added: 2024-06-11T15:51:27.489952
License: Public Domain

Chapman, J.
It is averred in the declaration that this action is brought in behalf of James M. Stevens; but such an averment has no legal force. It appeared in evidence that in December 1858 the plaintiff borrowed $400 of his son James M. Stevens, and gave him this order as collateral security therefor. There was also evidence tending to show that the instrument *336was made without consideration, and for the purpose of defrauding Friend’s creditors; that the plaintiff told the defendants that it would remain in the. hands of Friend, unless the mortgaged property to which it refers should, be attached by Friend’s creditors as his property; that the plaintiff had no interest in it whatever; and that the defendants might pay the money to Friend precisely as if it had not been made, unless the property should be attached; that accordingly the order went into Friend’s possession, and remained there till September or October 1857; that the defendants received thirteen hundred dollars for the sale of a part of said bricks, from which some expenses were to be deducted. They offered evidence of declarations made by Friend, both prior and subsequently to September 1857,' to prove payment to Friend, and fraud committed by the plaintiff. These declarations were rejected.
There can be no pretence that the declarations of Friend would be competent evidence to prove that the plaintiff had committed a fraud. Nor could his admissions of payment, made after the defendants knew he had given up the order to the plaintiff, be admissible against the plaintiff. But while he held it in his possession, for the purpose of having the amount paid to himself, for his own use, by consent of the plaintiff, his acknowledgment of such payment would be competent. If it had been made in writing, either by indorsement on the order, or by a separate receipt, it would have been too plain to admit of doubt. An oral admission is equally valid. It is an admission made as to the payment while it was his property and by a person since deceased. A portion of the evidence offered ought therefore to have been admitted.
The instruction given to the jury was also erroneous. It was that if the parties to the order agreed on a fraudulent transaction for the purpose of defrauding the creditors of Friend, and, as a part of the transaction, that the order should remain in the hands of Friend, to be paid to him if his creditors did not trouble him; “ and if the debt was so paid by the defendants, in pursuance of that direction; and if the order afterwards came into the hands of James M. Stevens for a good consideration, *337in good faith, and without knowledge of the transaction or of the payment, then the plaintiff could recover, to the extent of the interest of James M. Stevens, for his benefit.”
Upon this instruction, the jury would be required to find a verdict for the plaintiff, to the amount of $400 and interest, although the order had been fully paid by the defendants in pursuance of the agreement of the plaintiff before he pledged it to his son. But this is clearly - erroneous. The plaintiff had a right, if he was lawfully in possession of the order, to assign it to his son as collateral security for the money lent. The son could have a right to bring a suit in the plaintiff’s name to collect any balance that might remain due upon it, at any time when the defendants should be notified of the assignment. But payment to Friend before such notice would be an equitable defence; and the son took merely an equitable interest in the order, subject to all equitable defences. The right to sue in the plaintiff’s name is an equitable right, which courts of law in this state protect; and the subsequent attempt of the plaintiff to discharge the defendants is to be regarded as a fraud upon his son, and is inoperative. Hart v. Western Railroad, 13 Met. 108, and cases there cited.
But the assignment could not deprive the defendants of the benefit of payments already made, or made at any time before notice of the son’s claim; for that would be inequitable. And it xvould enable the plaintiff to convey to him a greater right than he had himself.
The questions propounded to the jury and answered by them, do not relieve the case from the effect of the erroneous rulings. The first three merely establish the good faith of James M. Stevens, and the fraud of the plaintiff and Friend. The fourth avoids the effect of the release to Parker. The fifth relates to the possession of the order in January 1859, a period subsequently to the pledge to James M. Stevens. The sixth establishes the fact that the defendants did not pay the balance to Friend before the transfer to James M. Stevens; but this is not a material fact, unless they had knowledge of the transfer.

Exceptions sustained.