Mishler v. Reed & Henderson

Chief Justice Agnew delivered the opinion of the court, May 18th 1874. The offer, the rejection of which is assigned for error, lacks an essential element, viz., notice to the plaintiffs of the fact that Frey had no right to control the proceeds of the note. Admitting all the facts offered to be proved, if Reed & Henderson, when they discounted the note, had no knowledge that Mishler was to control the proceeds, they were bonfi fide purchasers of the paper for value, [78] and cannot be affected by the private understanding.between Frey and Mishler. The printed form of the note kept for general use was no notice to the plaintiffs, because the words “ Credit the drawer,” constituting a part of the printed form, were not subscribed by the payee. On the contrary, the fact that they were not subscribed, and that the note was turned over and endorsed by Mishler in blank, was evidence that the parties did not intend to use the note according to the form. If Mishler intended to control the proceeds, he ought to have endorsed the note specially to his own order or to the credit of his own account. But by his endorsement in blank he sent the note out into the channels of business, to be used by the bearer. The fact that the note is found afterwards in the possession of the maker before it has fallen due, affords no legal presumption that it has been paid and taken up. It is not presumed that the drawer paid it before maturity. This point was decided in Eckert v. Cameron, 7 Wright 120. We discover no error in the rejection of the defendants’ offer, and the judgment is affirmed..