Court Opinion

ID: 3374359
Source: CourtListenerOpinion
Date Created: 2016-07-05 18:17:43.244369+00
Date Added: 2024-06-11T12:47:43.877070
License: Public Domain

ACTION of assumpsit on a promissory note for $500 made by Collins, the defendant, payable six months after *Page 539 
date, to the order of Gomey, and by him endorsed, and which afterward came to the hands of Sudler, the plaintiff, before its maturity.
Gomey, the payee and endorser, was called by the defendant as a witness, and objected to by the counsel for the plaintiff.
The action was on a negotiable promissory note made on the 26th day of July, 1860, by Joseph H. Collins, the defendant, for $500 payable six months after the date of it, to the order of George Gomey, which according to the evidence, was endorsed by him and came to the hands of the present holder of it, the plaintiff, before it matured or became payable, and as they had already discovered from the argument of counsel, there were two grounds of defence to it; first, that it was fraudulently put in circulation after it passed from the hands of Gomey, the payee and original holder of it, that is to say, that it was not put fairly into circulation in the ordinary course and operations of business, and contrary to the understanding and intention of Gomey, the payee, when he parted with it; and secondly, that after it was made and delivered by Collins to Gomey, and after it had been endorsed and delivered by the latter to Thayer, and before its maturity, it had been altered in the body of it, by the additional words written therein and at the close of it, "payable at the Bank of Smyrna," without the knowledge and consent of Collins, and by some one unknown to him; and which it had been contended by his counsel, was a material alteration, or an alteration in a material part of it, that vitiated and invalidated it in. the hands of the plaintiff. And as to these objections, or grounds of defence relied on by the defendant in the action, upon the first point the court had to say to them, that if they were satisfied from the evidence that there was a good and bona fide
consideration for the note as between Collins, the maker, and Gomey, the payee of it, at the time it was *Page 544 
made and delivered by the former to the latter, and that the latter endorsed and delivered it before its maturity to Thayer, his friend as he had stated, or lent it temporarily to him, in order that he might obtain a loan of money upon the credit of it, by depositing it as collateral security therefor in the hands of another, and that it afterward, but still before its maturity, came to the possession of the plaintiff, the present holder of it, so far as that matter alone was concerned, it would not constitute a legal defence to the action; notwithstanding the amount of it had been paid by Collins, to Gomey before its maturity, and if that were the only question or ground of defence in the case, their verdict should be for the plaintiff. For if there was such a consideration for the note as between Collins, the maker, and Gomey, the payee of it, and the latter before its maturity endorsed it and let Thayer have it for the special purpose stated, and he also before its maturity let the plaintiff have it, or was guilty of any breach of good faith, or of any violation of his agreement with Gomey in putting it in circulation contrary to his understanding and intention, by means of which it afterward came to the possession of the plaintiff before its maturity, without any proof of his knowledge of, or participation in such breach of faith, whatever might be the effect of such a fraudulent transaction in a suit upon the note against Gomey as the endorser of it, it could be 110 defence in law in an action upon it by such a holder against Collins, the maker of it, who had received from the payee to whom he made it full consideration for it, although Collins had before its maturity paid the amount of the note to Gomey.
But he would proceed next to consider the other and second ground of defence before stated, in regard to which the court would further say that if the jury should be satisfied from the evidence that when the note in question was made and delivered by Collins to Gomey, there was no place of payment written in the body of it, and that the words "payable at the Bank of Smyrna," which; *Page 545 
now appeared in the body and at the close of it, were afterward written and added to it by any one without the knowledge and consent of Collins, the maker of it, that would constitute in law a material alteration of it, and such an alteration in a material part of it without the sanction of the maker, as would vitiate and avoid it in the hands of the plaintiff, even if such material alteration had been made in it before it came to his hands and without any privity or knowledge of it on his part. Because if it was so altered in a material part without his knowledge and consent, after he had made and parted with it, it was not the note as he made it, and was consequently not his note, and he would not be liable afterward upon it in the hands of any holder, however innocent, who had or held it after such alteration. For the rule of law on that point was that any alteration made in a material part of a written instrument by a party holding it, without the sanction and consent of the party bound by it, for the greater benefit or advantage of the party holding it, will vitiate and avoid it; and the party who has the custody of an instrument made for his benefit, is bound to preserve it in its original state. Burchfield v. Moore, 25 E. L.  E.R. 123. And the first reason for the rule is that of public policy to prevent fraud by not allowing a person to take the chance of perpetrating it without incurring any risk of losing by the event when it is detected; and the second is to insure the identity of the instrument and prevent the substitution of another without the privity or consent of the party concerned. 1 Greenl. Ev. sec. 565. And that such an alteration in a promissory note as was then under investigation, might be for the benefit, or advantage of the holder of it, was apparent when they reflected that he might in that manner, not only make it more convenient for himself to present the note at the place of payment when due, and thus fix the liability of the endorser, but also at the same time make it much more inconvenient for the maker to meet the payment of it. If, therefore, the jury should conclude *Page 546 
upon the proof before them in regard to the matter that such an alteration as had been alleged and he had already described and defined to them, had been made in the note as before stated by him, the plaintiff would not be entitled to recover upon it, and their verdict should be for the defendant. But if otherwise, then it should be for the plaintiff with damages assessed to the amount of the note with interest thereon from the time it became payable, which was six months after the date of it.
                                          The defendant had a verdict.