Leger v. Bonnaffe

Edwards, J. Before considering the other questions which were raised upon the argument of this motion, it becomes important to decide at what time the purchase of the bills of exchange was made. The plaintiff states, in his bill, that the negotiations which resulted in the purchase, and also the actual delivery of the bills to him, and the transfer by him of the notes in question to the agent of Bonnaffé & Co., all took place on the 15th of November. The defendant Charles Bonnaffé, who made the sale, alleges in his answer, that he drew the bills of exchange, on the 13th of November, but he does not allege that they were delivered on that day, or at any time before the 15th ; and he admits that the notes which were given in payment for the bills, were transferred and delivered to him on the 15th. The affidavit of Mann, the book-keeper of Charles Bonnaffé, also states that the bills were drawn on the 13th, and that on that day, an entry was made by him in the books of Bonnaffé & Co. to that effect, and that he considered the sale as having been made on that day. But he does not state when the bills were delivered, nor when the notes which were given for them were received. The facts appear to be then, that the terms of the sale were agreed upon on the 13th, but that neither were the bills delivered, nor was the consideration for them re- [478] ceived, till the 15th; The bills did not become the property of' the plaintiff, nor did the notes become the property of Bonnaffé & Co. till that time. Of course there was no complete sale till then. It is alleged in the bill of complaint, and is admitted in the answers, that the house of Bonnaffé & Co., at Havre, failed on the 15th of November, the day on which the sale of the bills of exchange and the transfer of the notes in question took place. The answer of Charles Bonnaffé denies that he made the representations alleged by the plaintiff, or that he knew of the insolvency of the house, and as far as he is concerned rebuts the •allegation of fraud. The question to be decided is; whether, under these circumstances, the plaintiff is entitled to reclaim the notes. As the answer of Charles Bonnaffé, which is in that respect responsive to the bill, denies all the allegations on which the charge of fraud is founded, the plaintiff is not entitled to the relief sought, on that ground. The agent here cannot be charged with fraud, for he was ignorant of the insolvency of his principals; and the principals abroad cannot be charged with fraud, for they did not know of the sale made by their agent here. But, though the plaintiff'has not made out such a case as to entitle him to an injunction on the ground of fraud, I am of opinion that there aré sufficient allegations in the bill which are admitted, or are undenied by the answer or affidavits, to entitle the plaintiff to the relief which he seeks on other grounds. The fact of the failure of the house of Bonnaffé & Co. is one of such a character, that if it had been known to the agent here, who sold the bills, it would have made the transaction fraudulent. And althodgh it was not known, it made the bills worthless; at least for the purpose for which they were purchased, viz. for remittances abroad. There was a clear, though innocent mistake upon both sides, as to a material and essential fact, which, if it had been known td the plaintiff, must have prevented him from differing into the contract, and which if it had been known to the agent would have rendered the contract void. And I can hardly conceive of a case which could present stronger grounds for the rescission of a contract [479] 012 the ground of mistake, than this. (See Story’s Eq. Jur. §§ 140, &c.) It appears from the answer of Charles Bonnaffé, that a portion of the notes in question had been transferred to bona fide holders for a valuable consideration before the filing of the bill of complaint. As to these, the plaintiff is remediless in this suit. But it is contended on the part of the defendant, that the plaintiff has no remedy in this suit as to the remainder of the notes, because on the day of the filing of the bill of complaint in this cause, and before the service of the preliminary injunction, the defendant Charles Bonnaffe, under a general power of attorney, had made an assignment of the residue of the notes in question to the defendants Be Launay and Sagory, for the benefit of the general creditors of Bonnaffe <k Co. The answer to this is, that under such an assignment, there having been no new consideration actually advanced, the notes passed, subject to the equities of the plaintiff. (In Re Howe, 1 Paige, 128. Stanly v. The Sugar Refinery, 2 Edw. 505. Lupin v. Marie, 2 Paige, 169. S. C. 6 Wend. 77, 82. Haggerty v. Palmer, 6 John. Ch. 437.) It was next objected on the part of the defendant that the plaintiff was not entitled to the relief sought, on the ground that, after filing his bill, he had made a claim against the defendants Bonnaffe &, Co., under an attachment issued against them as absent debtors, which claim it is alleged, in an affidavit of the clerk of the solicitor for the defendant, was for the same amount as the bills sold to the plaintiff. And it is also alleged, upon the belief of the person making the affidavit, to be for the same claim as that which is in controversy here. But I do not consider such a claim as divesting the plaintiff of his remedy ip this suit. The claim was made after the bill was filed, and was merely the pursuit of a concurrent remedy. The plaintiff certainly cannot have a double satisfaction. And although this suit might be a bar to his claim under the attachment, that claim certainly ought not to bo a bar to this suit. Another objection which was made on the part of the defendants is, that .the plaintiff has not alleged that he was the owner or holder [480] of the bills of exchange at the time of filing his bill. It is true that there is no allegation of that kind in the bill, and that, there is an allegation to the contrary in the answer of Charles Bonnaffé. This would unquestionably be a sufficient objection to the decree sought by the plaintiff. But I do not consider it a sufficient objection to the motion which I am now called upon to decide. This cause is analogous to the case at law, where an action of trover is brought for the conversion of goods which have been obtained by fraudulent pretences, and for which the defendant has given his own note. In that .case it is sufficient if the note is delivered up to the defendant, or cancelled on the trial. (Thurston v. Blanchard, 22 Pick. Rep. 18.) An order must be entered directing that the injunction be made absolute, and that it be referred to Ogden Edwards, Esq. to appoint a receiver of the notes received by the agent of Bonnaffé &, Co. from the plaintiff, on the sale of the bills of exchange mentioned in the bill of complaint, and which have been assigned to De Launay and Sagory, as stated in the answer of the defendant Charles Bonnaffé.