Court Opinion

ID: 6406535
Source: CourtListenerOpinion
Date Created: 2022-06-25 11:49:24.269181+00
Date Added: 2024-06-11T15:51:13.721502
License: Public Domain

Wilde J.
afterward delivered the opinion of the Court. The note was indorsed by two of the payees, Cutler and Fleming, and made payable to the other payee, Warren, and to H. A. Green, and this we think was a good and legal transfer to them. It is a well established principle, that a partnership may by indorsement transfer the title to a bill or note to one partner. Bayley, (Phillips and Sewall’s edit. of 1826,) 77. And although the payees in this case were not general partners, yet by taking the note payable to them or their order, they made themselves partners as to this transaction, as was decided in Carvick v. Vickery, 2 Doug. 653, note. This. *270case was eventually decided upon the usage of London, but independently of the usage we consider the principle well settled, that partners or other joint payees of a negotiable note may legally assign it to one of the firm, or one of the joint payees. And it is so laid down by Parker C. J. in Russell v. Swan, 16 Mass. R. 316. By such an indorsement the assent of all the payees to the transfer is manifested, which is sufficient, especially when the indorsees put the note in circulation, as was done in the present case, and it comes into the hands of a bond fide purchaser. Upon the same principle the indorsement from Warren to Green is valid, and the technical objection to the form of the indorsements fails.
.There is also another answer to the objection, which seems to us to be perfectly satisfactory. Admitting, as the plaintiff’s counsel contend, that the indorsement by Cutler and Fleming to Warren and Green was not a valid transfer, it nevertheless became valid and effectual by the subsequent indorsement by Warren. For all the payees had then ordered the contents of the note to be paid to Green, and he might well declare upon it as on a note indorsed by them, and made payable to him directly ; for such was the legal effect, if the indorsement by Cutler and Fleming was defective until the indorsement was made by Warren ; and a party is not bound to set out a contract, literally, but may always declare upon it according to its legal effect.
As to the second question, we give no opinion, because supposing the defence set up would be good in an action by the payees, we think it very clear that it cannot be maintained in an action by a bona fide indorsee.
It has been argued by the defendant’s counsel, that the report of the judge discloses circumstances sufficient to justify an inference that the plaintiff had knowledge of some defect in the note ; and the form of the indorsement is principally relied on to maintain this inference. It was indorsed to be “ at the risk and costs ” of the indorsees ; but this may reasonably be supposed to have relation to the possible insolvency of the maker, and is equivalent to the, common form of indorsement without recourse to the indorser. But this would not authorize a jury to infer that the plaintiff or any prior indorsee bad any knowl*271edge that the patent-right for which the note was given was of no value, or that they had any reason to suspect that such was the fact, nor is there any circumstance in the case which can justify any such inference.
According to the agreement of the parties therefore the defendant is to be defaulted.