Court Opinion

ID: 8262405
Source: CourtListenerOpinion
Date Created: 2022-10-16 15:55:54.796088+00
Date Added: 2024-06-11T16:43:13.534477
License: Public Domain

BOND, J.
On the ninth of February, 1898, defendant executed a negotiable promissory note for $100, payable twelve months from date, with eight per cent interest. The consideration was money lost at play on the date of the note. By successive endorsements the note passed to plaintiff for value before maturity and without knowledge of its consideration. Upon pleadings» setting forth these facts the trial judge gave judgment for defendant, and plaintiff appealed.
If the present action had been brought by the original payee of the note there could be no recovery, for the plain reason that the parties to an executory contract, based upon an illegal consideration, who are equally in fault, are debarred from the aid of the courts in enforcing their agreement. That the present note is founded on a violation of law, results from the statute making the playing of any game of chance a misdemeanor. R. S. 1889, sec. 2212. The point for decision is therefore whether this defense, which would have been an insurmountable one to a recovery between the •immediate parties to the note, is equally preclusive against a *197holder in due course of trade. According to the rules of the lex mercatoria governing the rights of an indorsee of negotiable instruments, without notice for value, and before maturity, the plaintiff as such would clearly be entitled to recover. Unless, therefore, the statutes of this state have established a different rule for notes given for gaming debts, the present plaintiff is entitled to a judgment. The legislative will as to gambling is not only expressed in the gambling statute above referred to, but it is further voiced in chapter 32 of the Eevised Statutes 1899. That chapter has a double object. Eirst, it empowers any person who has lost any money or property upon a game of chance within three months thereafter, to sue for and recover the same by civil action, and extends this remedy to his privies in blood or estate. , Its second object is expressed in the following provision: “Assignment of any bond, bill, note, judgment, conveyance or other security, shall not affect the defense of the person executing or confessing the same.” E. S. 1899, see. 3127. The first intent of the chapter under consideration is subserved by talcing away the application of the universal legal maxim in pari delicto potior est conditio defendantis from the payment of gaming losses; or in other words, affording the active aid of the court- in -restoring to a party money or property which he has paid in the consummation -of an illegal transaction of this particular species. The second intent of the statute is effectuated by -extending the “defense” which one party to an executory illegal contract possesses at all -times to its enforcement by the other, so as to malee such defense -equally available against the enforcement of the contract after its assignment to third parties. To this extent the legislature saw proper to except negotiable notes given for gambling losses from the operation of general mercantile law, the constant aim of which is to preserve the rights of innocent holders of negotiable instruments against any infirmities *198which might affect paper in the hands of the original parties to it. The purpose of the statute thus expressed in the section above quoted being plain and unmistakable, and the legislature having full constitutional power to enact it, it becomes our duty to apply its terms to the issue presented by this appeal. We accordingly hold that the learned trial judge did not err in rendering judgment on the pleadings in this case in favor of defendant. The judgment is therefore affirmed.
All concur.