Court Opinion

ID: 3304106
Source: CourtListenerOpinion
Date Created: 2016-07-05 17:19:29.93728+00
Date Added: 2024-06-11T12:27:38.814966
License: Public Domain

[EDITORS' NOTE:  THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *Page 315 
The plaintiff seeks by this action to recover the possession of a certain promissory note, of which she claims to have been deprived through the acts of the defendants, and states in her complaint the following facts as the grounds of her right of recovery. In April, 1894, Thomas W. More, one of the defendants, made his promissory note to his brother, Wallace H. More, who is the husband of the plaintiff. In November, 1894, Wallace More borrowed some money from the defendant Kaeding, and delivered the note to him as security therefor. December 12, 1894, while the note was thus in the possession of Kaeding, Wallace More, by an instrument in writing, assigned it to the plaintiff. The plaintiff with her husband came from Ontario, where they had been living, to Santa Barbara, where the defendants then lived, and on January 14, 1895, she informed the defendant, Thomas W. More, that the note had been assigned to her, and that she was its owner, and that she desired to get possession of it, and Thomas offered to aid her in so doing. In her complaint she alleges that her husband was addicted to the use of intoxicating liquors to such an extent as to impair his mental capacity and that his brother Thomas knew of this weakness, and that he, after their arrival at Santa Barbara, and with the intent to get possession of the note and deprive her thereof, and to defraud her, confederated and conspired with the other defendants for that purpose, and, in pursuance of such conspiracy, they had certain negotiations and caused certain written instruments to be prepared by which the note came into the possession of the defendant Finger on the fifteenth day of January; that on the next day Thomas, with the knowledge that the note was in the possession of Finger, had the plaintiff accompany him for the purpose of redeeming the note from Kaeding, and, while pretending to seek a loan in her behalf for that purpose, secretly induced his brother to accompany him elsewhere, and having stupefied him with intoxicating liquors to such an extent as to render him incompetent to transact business, her husband was induced to assign the note to one of *Page 318 
the defendants. The appellants demurred to the complaint, and their demurrer having been overruled, they answered, denying the most of its allegations, but admitting that Wallace H. More did sell and deliver and assign the note to them on said sixteenth day of January, but alleged that this was done without any notice on their part of any right or claim of the plaintiff thereto, and that they gave him full value therefor. The record does not show that either Kaeding or More filed any answer to the complaint, although it appears that at the trial certain attorneys appeared in behalf of Thomas W. More. The case was tried by a jury, and a general verdict rendered in favor of the plaintiff against the appellants and Thomas W. More for the possession of the note, or three thousand dollars, the value thereof, in case a return cannot be had. In addition to the general verdict, certain special issues were submitted to the jury at the request of the defendants Finger and Rogers, to which the jury returned answers which are in support of the general verdict. Judgment was thereupon entered against Thomas W. More and the appellants. No verdict or judgment was rendered against the defendant Kaeding. A motion for a new trial made on behalf of Finger and Rogers was denied, and from this order and the judgment they have appealed.
The demurrer was properly overruled. The facts set forth in the complaint sufficiently state a cause of action against these defendants, and these facts constitute only one cause of action, namely, the plaintiff's ownership of the promissory note and her right to its possession, and the invasion of that right by the wrongful acts of the defendants, constituting a breach of their obligation to her and for which she seeks redress. (Pomeroy's Code Remedies, sec. 453.) The relief to which she may be entitled upon this statement of facts is to be determined by the court, but the cause of action, which is sufficiently stated, is not impaired by her asking for relief to which she is not entitled, or for one species of relief rather than another. The statement in the complaint that the defendants had converted the promissory note to their own use did not deprive her of a right to its recovery, if upon the trial the evidence should justify such relief. Upon a default by the defendants, she could recover *Page 319 
only such relief as she had demanded in her complaint, but after they had answered the complaint the court, under section 580 of the Code of Civil Procedure, was authorized to grant her any relief consistent with the case made by the complaint and embraced within the issue. (Zellerbach v. Allenberg, 99 Cal. 68.)
The complaint alleges that the plaintiff has been deprived of the note by the wrongful acts of the defendants, and that they entered into a conspiracy for that purpose, but the conspiracy thus alleged is not the gist of the action. The gist of the action is the injury done to the plaintiff by these wrongful acts, and this injury is actionable whether it is the result of a conspiracy or not. The averment of a conspiracy is immaterial, and could be proved without such averment, or, if averred, need not be proved. The plaintiff is entitled to relief for the injury from such of the defendants as she can show have united or co-operated in doing her the wrong. (Herron v. Hughes, 25 Cal. 556;  Hamilton v. Smith, 39 Mich. 231; Boston v. Simmons,150 Mass. 461; 15 Am. St. Rep. 230.)
The evidence on the part of the plaintiff that she had become the owner of the note, prior to any of the acts of the defendants complained of, is uncontradicted, and it sufficiently appears from the record that the defendant Thomas W. More was informed by her of that fact on the morning of January 14th, and that he thereafter co-operated with the other defendants in the acts by which she was deprived of the note. The admission in their answer by these defendants that they had purchased the note from Wallace More on the 16th of January, coupled with the proof that he was not at that time its owner, authorized the court to render judgment in her favor for its possession, unless the defendants should show a right to its retention by reason of some circumstances giving to them a right paramount to hers, or estopping her from claiming the same.
The circumstances under which they obtained the note are as follows: Arrangements had been made between Rogers and Finger prior to January 15th, by which they were to let Wallace More have some money, and they were to obtain the note from him and have it secured by a mortgage from Thomas. On that day Finger obtained possession of the note from Kaeding, and papers were prepared *Page 320 
for the purpose of carrying these arrangements into effect. Wallace More was, however, intoxicated during that afternoon and in bed at his rooms at the hotel, and the completion of the business was postponed until the next morning. On the morning of the 16th Wallace went, in company with Thomas, to the office of the attorney, and while Thomas remained outside he went into the office where were Rogers and Finger, and the papers were then signed and the note transferred to them. The appellants contend that as the note was negotiable in form, and as they took it before maturity for a valuable consideration, without any knowledge or notice of the plaintiff's claim, they are protected in the transaction.
Section 3124 of the Civil Code declares: "An indorsee of a negotiable instrument in due course acquires an absolute title thereto, so that it is valid in his hands, notwithstanding any defect in the title of the person from whom he acquired it."
Section 3123 of the Civil Code is as follows: "An indorsee in due course is one who in good faith, in the ordinary course of business and for value, before its apparent maturity or presumptive dishonor, and without knowledge of its actual dishonor, acquires a negotiable instrument duly indorsed to him, or indorsed generally, or payable to the bearer."
The facts in the case do not bring the appellants within the definition of an indorsee given in section 3123, and, consequently, they are not entitled to the protection granted by section 3124 As they obtained the note from Wallace More by mere delivery, without any indorsement thereof, the instrument was not "duly indorsed" to them when they acquired it, and they cannot be said to have received it in the ordinary course of business, or in good faith. If they were purchasing the note from him, they could not under the law merchant acquire a title thereto as against any prior assignee, unless he should indorse it to them. A mere delivery of the paper without his indorsement would not give to them any title thereto as against a previous assignment by him, any more than would a delivery of any other piece of personal property to which he had no title. Wallace More testified, moreover, that when Thomas came for him on the morning of the 16th he gave him a flask of liquor, and that he did not have much recollection of the business transacted at the attorney's office. Another witness testified *Page 321 
that he was drunk when he came into the office of the attorney, and the jury found in response to the special issues requested by the appellants that he was intoxicated on that day when he attempted to transfer the note to Finger, and that he did not at that time intend to dispose of it to him. Under these facts the jury was authorized to find that there had been no valid transfer to the appellants of the note by Wallace, and that they did not receive the same or give a valuable consideration therefor in good faith; and their verdict that the plaintiff was entitled to the possession of the note must be sustained.
It was not necessary that the plaintiff should refund to the appellants the two hundred and eighty-one dollars which they had given to Wallace at the time they received the note. If the note belonged to her, they could not acquire a right to retain it by purchasing it from one who had no right to dispose of it. Neither was she required to pay to them the forty-five dollars for which it had been held by Kaeding. While Kaeding might have been entitled to retain the note until this amount was paid to him, there is no judgment rendered against Kaeding. The appellants did not succeed to his rights, or acquire the obligations for which he held the note, and it appears from the record that he was fully paid.
The court did not err in receiving against the objection of the appellants the testimony of the plaintiff regarding her conversation with Thomas W. More. Thomas was a defendant in the action, and the testimony was admissible as against him. The court would have limited the effect of this testimony in its instructions to the jury, if requested by the appellants, and, although the instructions are not in the record, we may assume that it did so limit it. Even if the plaintiff had been seeking to establish a conspiracy between Thomas and the appellants, the court did not err in receiving the testimony. The order of proof was within the discretion of the court, and, if the testimony was not subsequently connected with the appellants, it would have been stricken out upon their motion. (Place v. Minister, 65 N.Y. 89. )
The objection by the appellants that the verdict cannot be sustained, for the reason that there was no evidence that they or either of them had any knowledge or notice of the previous *Page 322 
transfer of the note to the plaintiff, it not tenable. The special issue upon this subject to which the jury responded was whether E.F. Rogers or H.J. Finger or Otto Kaeding, "or any of them," had such knowledge, and it was testified to by the plaintiff that she did inform Kaeding on the 14th of January.
It was proper to refuse to instruct the jury what would not defeat the title to the instrument, unless it also appeared that a title thereto had been conveyed to the appellants. If the appellants had received the note from Wallace More in the ordinary course of business, the instruction asked by them would have been properly given to the jury, but, as it appeared that at the time they received the note it had not been indorsed by him, the instruction would have been misleading. The instructions given by the court were correct in point of law.
The judgment and order are affirmed.
Garoutte, J., Van Dyke, J., Temple, J., McFarland, J., and Henshaw, J., concurred.