Court Opinion

ID: 5581104
Source: CourtListenerOpinion
Date Created: 2022-01-11 01:39:29.290082+00
Date Added: 2024-06-11T08:36:05.514682
License: Public Domain

Atkinson, J.
1. Paragraph 5 of the plea sought to set up failure of consideration of the note, on the ground that it was given for certain stock in the Athens Insurance Agency, which was being sold by one Guest, -to whom the note was delivered, that in making the sale Guest made certain guaranties as to the present value of the stock and as to future dividends it would pay, but that in fact at the time of the sale of the stock the company was insolvent, and soon thereafter it went into the hands of a receiver, and the stock was entirely worthless at the time of the purchase. The note was executed before passage of the act. of 1912 (Acts 1912, p. 153, Park’s Code, §§ 4294 (a), 4294 (b)), and consequently that law has no application. The note was a negotiable promissory note, payable on a date subsequent to that of its execution. In Parr v. Erickson, 115 Ga. 873 (42 S. E. 240), it was held: “Where a negotiable promissory note, payable at a future date, was indorsed by the payee to the plaintiff, in the absence of proof to the contrary, the law will presume that the plaintiff took before maturity, for value and without notice.” It was also held: “A *497bona fide holder of a negotiable promissory note, purchased for value and before maturity, is protected against a defense that the note was without consideration.” In Oliver v. Miller, 130 Ga. 72 (60 S. E. 254), it was held: “The holder, for value, of a negotiable promissory note, who receives it before due, without notice of equities between the parties thereto, will be protected against such equities.” Where suit is brought upon a promissory note by a transferee, alleging himself to be a bona fide holder thereof for value, a plea which seeks to set up failure of consideration or any other equities between the original parties must aver that the plaintiff took with notice of such equities. See Hendrix v. Bauhard, 138 Ga. 473 (2), 481 (75 S. E. 588, 43 L. R. A. (N. S.) 1028, 29 Ann. Cas. (1913D) 688). There is nothing alleged in the plea that resembles a charge of notice to the plaintiff, except the allegation, “That said guarantee or condition, being written upon the face of the note, became a part of the note, and that the Bank of Harlem, when it purchased said note from said Guest, did so with full knowledge of the conditions attached to said note, and subject to all the equities existing between said Guest and said J. S. & J. F. Hardin.” When these allegations are considered most strongly against the pleader, they merely amount to a charge that the written memorandum on the margin of the note charged the plaintiff with notice of the failure of consideration. In this connection see First National Bank of Etowah v. Messer, 136 Ga. 226 (71 S. E. 148). When the memorandum is considered, it does not purport to show anything except the fact that the note was given for certain shares of stock, and that certain dividends were guaranteed. In Hudson v. Best, 104 Ga. 131 (30 S. E. 688), it was held: “A knowledge of the consideration of a negotiable promissory note by a purchaser thereof, for value and before maturity, is not sufficient to charge him with notice of the failure of such consideration.” See also Bank of Commerce v. Barrett, 38 Ga. 126 (95 Am. D. 384); Park v. Zellars, 139 Ga. 585 (4), 586 (77 S. E. 922); Bank of Lavonia v. Bush, 140 Ga. 594 (79 S. E. 459). In the light of what has been said, there was no error in striking paragraph 5 of the plea.
2. The amendment which the court rejected sought to set up equities of the same general character between the defendants and the Athens Insurance Agency, and it was alleged in unqualified *498terms that the plaintiff purchased the note with notice of the equities of the defendants, which were specified. It was not alleged that the Athens Insurance Agency was one of the original parties to the note, or that it was a holder of the note at any time when the defendants may have received any such guaranty or promise as was described in the amendment to the plea. For aught that appears, the Athens Insurance Agency was an entire stranger, and no broken promise by the Athens Insurance Agency to the defendants with respect to the stock in the corporation could affect the plaintiff, even with notice of such promise and a breach thereof.
3. Under the admissions in the pleadings, there was no issue as to the right of the plaintiff to recover attorney’s fees or the amount thereof; and upon introduction of the note in evidence, there was no error in directing a verdict for the plaintiff.

Judgment affirmed.

All the Justices concur.