Court Opinion

ID: 4934206
Source: CourtListenerOpinion
Date Created: 2021-09-24 01:12:23.171672+00
Date Added: 2024-06-11T08:14:36.452219
License: Public Domain

Dissenting Opinion by
Appleton, C. J.
This is an action of assumpsit upon a note "of the following tenor:
"''SISO. Orrington, January 7, 1879.
Three months after date, I promise to pay H. T. Jepson & >Co. or bearer, one hundred and eighty dollars at- the Farmer’s .National Bank, Bangor, Maine, value received.
(Signed) , Alfred Baker. ”
The plaintiff is a stable keeper in Bangor. He testified that .he purchased the note in suit and others before their maturity, paying the full value therefor, and ignorant of any facts that •would tend in the slightest degree to impeach their validity, that 'the persons of whom he purchased, — introduced themselves as "having occasion to hire teams, — stating that they had been recommended by a friend of his to apply to him — that he fixed •a price per day, that they hired his teams paying promptly for their use — that after paying seventy-five or a hundred dollars — ■ they proposed purchasing horses and harnesses as cheaper than Firing and paying for the same in notes, (one of which is the 'one in suit), that he objected, but upon their assertion that they were good and would be met at maturity, he employed an attorney to examine the registry of deeds to see if the signers owned real estate and finding they did, he made a trade, by which he obtained the note in suit and others, for the property sold them, that he did not know their business, but supposed they were runners, and that he neither knew nor had suspicion of any fraud in the procuring of the notes, or for what they were given.
*341The note was given on time. The plaintiff purchased it shortly after it was given. He gave full consideration for the same. The fact of full consideration is the surest guaranty of good faith. He knew nothing of the circumstances under which the note was given. He had no suspicions of its fraudulent origin. He was under no legal nor moral obligation to enquire as to the origin of the note. The signer had announced to the public that it was for " value received.” He knew the parties with whom he traded as customers and traded with them as such. All this is uncontradicted.
¿No principle of law should be more carefully guarded or more sacredly adhered to than that the bona fide holder of a note purchasing it for its value before maturity, should be protected against the sympathy a jury may have for the folly or their indignation against the fraud by which a note may have been dishonestly obtained.^ The bona fide purchaser is ignorant of the folly. He is no party to the fraud. The foolish and the deceived must bear the consequences of their folly and imbecility and not impose on those who relied on their assertions, the penalty which nature always attaches to negligence or want of caution.
The law as to the rights of a bona fide endorsee of a note before maturity and for value, is settled by a rare and unequalled uniformity of decisions in every State of the Union. " Possession of such an instrument payable to bearer, is prima facie evidence that the holder is the proper owner and lawful possessor of the same; and nothing,” observes Clifford, J., in Collins v. Gilbert, 94 U. S. 753, " short of fraud, not even gross negligence, if unattended with mala fides, is sufficient to overcome the effect of' that evidence or to invalidate the title of the holder supported by that presumption. ” Such after a full examination of the authorities bearing upon the question has been held to be the law in this. State. Farrell v. Lovett, 68 Maine, 326; Kellogg v. Curtis, 65 Maine, 59; Swift v. Smith, 102 U. S. 442. "The other rule-laid down in some of the cases, that an endorsee for value cannot, recover if he takes the note without due caution, or under circumstances which ought to excite the suspicions of a prudent *342man,” observes Morton, J., in Smith v. Livingston, 111 Mass. 345, "is indefinite and uncertain. ” The rule established is in accordance with the general principles of commerce and best ¡adapted to protect the free circulation of negotiable paper. Re Great Western Tel. Co. 5 Biss, 363; Morehead v. Gilmore, 77 Penn. 118.
The plaintiff is to be protected. He had no suspicion or knowledge of the fraud. He .bought before maturity. He paid full value.
The defendant interposes three grounds of defence : The first is that it is a forgery.
It is only necessary to examine the signatures to see at a glance that the defendant’s signature to the note is genuine. It is safe to say that no intelligent man can have an honest doubt on the subject.
The next ground is that " if the signature was his it was made by him with the intent to sign another and entirely different instrument, and that no negligence was to be imputed to him, he not knowing what he signed.”
The defendant’s signature is on two papers in the case. The first was a statement of his real estate and his stock. This he testifies he read carefully, — " was very careful about it, ” (the .reading,) and knows he understood it. It was in these words :
"Orrington, June 7, 1879.
" This certifies that I, Alfred Baker, have examined the Sisson Improved Pruning Shears, and do consider them a practical implement, and have purchased of H. T. Jepson & Co. forty-five pieces at four dollars each, and have given my written obligation in the amount of ‡180, which is negotiable and payable at ■the Farmer’s National Bank, of Bangor, Maine,” &c.
(Signed) Alfred Baker.”
In the agreement entered into between him and " the manufacturers of the Sisson pruning shears, ” which was delivered him, ■there is the recital of his having " given his written obligation fin the sum of $180. ”
Both these papers he carefully read and understood. He ¡swears he was very particular 'as to his reading them. After *343reading them with care, he signed a paper reciting that he had given his "written obligation in the amount of $180, which is negotiable and payable at the Farmer’s National Bank, Bangor, Maine,” — and that he received an appointment of his agency, which he,produced containing a statement of the same fact. After a careful perusal of these papers he knowingly and understandingly testifies to these facts. What is such an obligation but a nóte of hand ? There is his written statement — that he had done this and his oath that he read the paper and understandingly signed it.
This paper he placed in the hands of the men with whom he was contracting. It gave assurance of his ability to pay. It was given to be used. It was used. Upon the credit of the facts therein stated, and in the belief of their truth, the plaintiff made his purchase. If ever the doctrine of estoppel is to be applied, it is in a case like the present. If one of two must suffer, it certainly should not be the plaintiff, whose only fault is in believing the defendant’s statements to be true.
If it be said that the defendant did not understand the meaning of the word " obligation, ” the plaintiff should not suffer for such gross ignorance. He did know that he signed a paper obliging him to pay a sum of money — which was negotiable and payable at a bank.
No one can reasonably doubt that the defendant signed the note in question, and knew what he was signing. If he did not, the plaintiff should not suffer for such inconceivable negligence and stupidity. He should not seek to throw the burden upon one who without fault relied upon his written assertions. He would be barred by his assertions as to property. He is equally so as to ownership.
The defendant is estopped by his representations. He notified to the world that he had signed a negotiable contract. He stated the date and amount, when and where payable. He stated the means he had with which he could pay it. He promised to pay to whomsoever it should be endorsed.
If he had written a letter to the plaintiff containing the facts set forth in his certificate, and the plaintiff had in good faith, purchased the note, relying on them, he would be estopped to defend *344against the same. He did more. He wrote a general letter to the whole community reciting' what he had done, and that he had means with which to meet his note at maturity. The plaintiff in good faith, relying upon the truthfulness of his representations, purchased. The defendant may have been deceived in making-those representations, and thus be a loser. The plaintiff who relied upon them should not be. Such is well settled law.
To create an estoppel in pais the representation relied upon, must have induced the party seeking- to enforce an estoppel, to do what resulted to his detriment, and what he would not otherwise have done. Allum v. Perry, 68 Maine, 233. "In all cases where one party has been induced to take a particular course in the faith of statements made or expectations held out either expressly or by implication, by another, the latter will be debarred from pursuing- any subsequent mode of action at variance with his former language and conduct, to the injury of the former. ” 2 Hare & Wallace, Leading* Cases, 165.
There is no dispute as to the above facts. It is a clear case of negligence. In Kellogg v. Curtis, 65 Maine, 590, the judge, on facts similar to the case at bar, decided that the defendant was defrauded and guilty of negligence in signing the note in question. "What constitutes negligence in a case like this, ” obsei’ves Peters, J., "when the facts are clear and unequivocal, is a question of law. ” "The principle is clearly and correctly enunciated in a late case in Missouri not yet reported, thus: ' When it appears that the party to be charged intended to bind himself by some obligation, and voluntarily signed his name to what he supposed to be the obligation he intended to execute, having full and unrestricted means of ascertaining- the true character of such instrument before signing it, but neglected to avail himself of such means of information and relying* on the representations of another as to the contents of the instrument, signed and delivered a negotiable promissory note, instead of the ■instrument he intended to sign, he cannot be heard to impeach its validity in the hands of a bona fide holder. To the same effect is the case of Abbott v. Rose, 62 Maine, 194. One who allowed his name to be signed to a promissory note, supposing *345bis signature was being attached to the acceptance of an agency, is liable to a bona fide indorsee. Indiana Bank v. Weckerly, 67 Ind. 345, and Maxwell v. Morehart, 66 Ind. 301. Here there is no allegation or pretence of the substitution of one paper for another as the defendant testifies he signed a paper making him liable, and if he failed to appreciate its effect, the loss should be his and not another’s.
The last ground of defence is that when the note was given, the payees or their agents had no intention of delivering the articles contracted to be delivered — and therefore that the note was without consideration and fraudulent in its inception. That may be conceded but it furnishes no defence against a bona fide holder. Such is the universal rule.
To sustain this branch of the case the evidence of one Bragdon was received.as to his subsequent dealing with two. persons who were not identified as those dealing with the defendant. Their identity should have been first shown. This was not done. The statements and the conversation with them — res inter alios — were admitted and the jury weré permitted without proof to infer identify. Com. v. Jackson, 132 Mass. 16. The conversations of Bragdon with these strangers was hearsay, inadmissible and offered to prejudice the jury. But this illegal testimony was admitted to affect the rights of a bona fide holder. It was admitted to prove identity — the question in dispute. Though evidence legally inadmissible, it had the same effect as if admissible. The jury were allowed to give the same effect to and to draw the same inferences from illegal testimony as from legal.
These strangers had not been witnesses — therefore the evidence was not admissible to contradict what they might have said on the stand. It is a bald case of hearsay.
The verdict was the result of sympathy for the defendant. But he has little claim to sympathy. He entered into a contract by which he expected great profits from his neighbors. He seeks to escape from his " obligation ” by the denial under oath of his signature. He may have been the victim of knaves. But that is no reason why the plaintiff should become the victim of his folly or his falsehood. Men had better bear the consequences *346of negligence than seek to escape them by perjury. Cheating is criminal but there are greater and grayer crimes.
I think a new trial should be granted.
Barrows, J., concurred.