Inhabitants of Otisfield v. Mayberry

Appleton, C. J. Assuming that the defendant, one of the selectmen of the plaintiff town received on a settlement with its treasurer, or in any other way a promissory note payable to bearer issued by said town, for cancellation, the same having been paid, and instead of cancelling, should transfer it to a bona fide holder, by whom the same was, presented to the treasurer for the time being, and paid by him, in ignorance of the facts, is he liable in trover to the town for such conversion of its paid promissory note % The maker of a note has a right to its possession upon payment. In his hand it is evidence of such payment. In the hands of a stranger it is prima facie evidence of indebtedness. If a suit is brought it imposes upon the maker the necessity of a defence — the procurement of testimony — the employment of counsel, and the delay, expense and vexation of litigation. The possession of it by the maker is of importance to him. The conversion of it by another may become a source of indefinite injury. Accordingly, it has been held in this State in Neal v. Hanson, 60 Maine, 84; in Vermont in Buck v. Kent, 3 Vermont, 99 ; Pierce v. Gilson, 9 Vermont, 216; and in Spencer v. Dearth, 43 Vermont, 98; and in New Hampshire in Stone v. Clough, 41 N. H., 290, that trover may be maintained by the maker against the payee for the conversion or wrongful withholding of his paid promissory note. The note in controversy has been paid a second time. It belonged to the plaintiff upon payment. The defendant’s fraudulent conduct has caused such second payment. It is not for him to take advantage of his own wrongdoing. Nor can he allege negligence on the part of the officers of the plaintiff town. In the changes incident to municipal governments new officers are chosen, who are -necessarily, to a certain extent, ignorant of the doings of their predecessors. Mercantile accuracy cannot be ex [200] pected in their book-keeping. If the defendant, a selectman, having a paid note of his town should represent it as unpaid to a treasurer, ignorant of its payment, and credit being given to his false representations, should receive its amount, he would unquestionably be liable to the town, in assumpsit for the money thus by him received. He is none the less liable because, representing it as due by the very act of its transfer for value, he has transferred to a holder to whom upon the faith of the paper as it appeared and of its want of cancellation it has been paid by the treasurer of the town in ignorance of the facts. The withholding the note on demand or its fraudulent transfer for value as evidence of the existing indebtedness of the town would constitute an act of conversion for which the defendant would be liable. The damages to which the plaintiff would be entitled would depend upon the injuries sustained. In Stone v. Clough, the defendant surrendering the note, the plaintiff was content with nominal damages and costs. In the present case, upon the facts assumed, the damages must be deemed commensurate with the note and interest. The defendant by disposing of the note and receiving its value, converted it to his own use. He has had the full benefit of it, and it is not for him to say the town might have defended against it. Exceptions sustained. Walton, Dickerson, Barrows, Yirgin and Peters, JJ., concurred.