Court Opinion

ID: 6599048
Source: CourtListenerOpinion
Date Created: 2022-07-20 20:06:05.99773+00
Date Added: 2024-06-11T15:57:57.218226
License: Public Domain

By the Court,

PAINE, J.
This action was brought to foreclose what is commonly called a farm mortgage, for the nonpayment of interest. The mortgage was given with a note to the Watertown & Madison Eail Eoad Company, and there is no question that the company might take such a note and mortgage, in the proper execution of its powers to construct a rail road, according to the former decisions of this court.
The court below, however, sustained a demurrer to the complaint, for the reason that it only alleged generally that the defendant gave the note and mortgage to the company, and that the company duly transferred them to the plaintiff and his deceased partner, without ¡setting forth specifically the facts *462showing that they were given for stock, so as to bring tbe case within the decisions referred to. But this was unnecessary. Wherever a corporation is authorized to take a note for any purpose, the prima facie presumption is, that a note given to it was given for a legitimate purpose. A large number of authorities to this effect, are cited in the argument of counsel in the case of Clark vs. Farrington, 11 Wis., 815. See also Farmers' & Millers' Bank vs. The Detroit & Mil. R. R. Co. decided by this court at this term (ante. p. 372).
It follows necessarily from this presumption, that it is not essential for the complaint in such cases to show that the note was given for a purpose authorized by the charter, but that it is sufficient to declare on it as would be done if it had been given to a natural person.
It is also contended by the appellant, that even though this note and mortgage were given for an unauthorized purpose, still the plaintiff appears to be a bona fide indorsee for value, and that therefore the complaint is good in his favor upon the doctrine sanctioned in Cornell vs. Hichens, 11 Wis., 369, and many other similar cases. But this note was payable to the company or its order, and the complaint hardly states enough to show an indorsement of it, within the decision of this court in Crosby v. Roub, 16 Wis., 616. In that case, as in this, the note was transferred as collateral to the bond of the company, which was payable to bearer, and the transfer of the note was contained in the bond itself, as it is here. But it further appeared in that case, that the note was attached to the bond; and that was a very material fact upon which to base the conclusion that it must be held to be an indorsement, so as to transfer the legal title. This complaint fails to show that fact, and consequently, if it appeared that the note was given for an unauthorized purpose, the plaintiff, on its allegations, would not be in a position to claim protection as a bona fide indorsee, within that decision.
But however material this question may become in the ulti *463mate determination of tbe case, it is immaterial on the demurrer, for the reason already given, that the presumption is prima fade in favor of the validity of the note. And upon the allegations of the complaint the plaintiff appears to be at least an assignee of the note, and authorized, as the law now is, to maintain the action in his own name.
This note was made payable at the office of the Farmers’ Loan and Trust Company in New York; and it is objected that the complaint is defective in not averring a presentment there. But it is too well settled to need examination here, that where a note is payable at a particular place, it is not essential, in maintaining an action against the maker, to show a demand at that place, at the time it fell due.
The complaint also sufficiently shows that the note and mortgage were purchased by the plaintiff and his deceased partner as partnership property. It avers that they were copart-ners in trade, doing business under the name of “ S. & 0. Howard,” and that the note and mortgage were transferred to the said “ S. & C. Howard; ” which, being a firm name, shows a transfer to the firm. The complaint also avers that the plaintiff now owns the note “ as surviving partner,” which is equivalent to an allegation that it was partnership property. This must certainly be held sufficient.
The order sustaining the demurrer is reversed, with costs, and the cause remanded for further proceedings.