Court Opinion

ID: 6572498
Source: CourtListenerOpinion
Date Created: 2022-07-20 19:31:11.436182+00
Date Added: 2024-06-11T15:56:57.281779
License: Public Domain

The opinion of the court was delivered by
Bennett, J.
This case presents the simple question, whether the indorsee of a negotiable note can recover against the maker on the common money counts, in a case where the indorsee is not the owner of the demand, but holds it simply for the purpose of collection, as the agent or trustee of the payee. It is too well settled, to be at this time questioned, that the payee can maintain an action against the maker of the note for moneys had and received. The note furnishes evidence that the maker has received from the payee a sum of money, which he promises to repay.
Though it has been sometimes questioned whether the same principle applies to an action by the indorsee against the maker, yet, I conceive there is no sufficient reason why it should not. In Dinsdale v. Lanchester, 4 Esp. R. 201, it was expressly determined that the indorsee might maintain *451an action for money bad and received. In Tatlock v. Harris, 3 Term R. 174, the indorsee of a bill o( exchange recovered against the acceptor under the money counts. Lord Kenyon uses this language ; “ We consider it an agreement between all the parties to appropriate so much property to be carried to the account of the holder of the bill.” In Grant v. Vaughn, 3 Burr. 1516, it was held that the bearer of a bill of exchange might recover against the drawer upon the general counts. By the statute of Anne, promissory notes payable to order or bearer, are put on the same ground as inland bills of exchange, and are made in like manner negotiable. By our statute they are also negotiable, and, when negotiated, the indorsee is invested with the right of action. The promise is to pay the money to the payee named in the note, or to such person as he shall appoint. As soon as the note is negotiated, the privity of contract attaches between the new parties, and the maker holds the money to the use of the indorsee.
It is well settled, in many of our sister states, that the action may well be sustained by the indorsee against the maker of a note, and a recovery had on the money counts. Wilde v. Fisher, 4 Pick, 421. Cole v. Cushing, 8 Id. 48. Ellsworth v. Brewer, 11 Id. 316. Ramsdell v. Soule, 12 Id. 126. Eagle Bank v. Smith, 5 Conn. 71. Pierce v. Crafts, 12 Johns. 90. Denn v. Flack et. al. 3 Gill & Johns. 369. See also Bayley on Bills, 287, and Master v. Miller, 4 Term. R. 339. It true, in the case of Waynam v. Bend, 1 Camp. R. 175, and in Bentley et al. v. Northhouse, 2 Ryan & Mo. R. 66, a different doctrine is held; but I think the opinion expressed in those cases is opposed to principle and contradicts the current of decisions on this point. It is said, however, that, let this principle be as it may, as applicable to a case where the indorsee is the holder for a valuable consideration, yet, it ought not to be extended to a case like the one at bar. It is well settled that the indorsee of a note, though only indorsed for the purpose of collection, may maintain an action on the note in his own name. It is not for the maker to inquire into the consideration for the indorsement, and it is no objection that the indorsee sues as the trustee of the payee. The maker has promised to pay to the payee or to such person as he shall appoint to receive *452the money. It is difficult to see how this objection can apply with more force to the present case than when the indorsee declares upon the note in a special count. The evidence shows the indorsee to have the legal interest in the note, and though he recovers the money in trust for the payee, still, in legal contemplation, the maker has in his hands money to the use of him who has the legal interest, and it is of no possible consequence to the maker whether the indorsee recovers for his own use, or in trust for the payee. There is, we think, no error in the omission of the county count to instruct the jury as requested, and the judgment of that court is affirmed.