McGowan v. Budlong

Mr. Justice Paxson delivered the opinion of the court, January 6th 1876. There is but one specification of error in this case, and that refers to the rejection by the court below of the defendant’s offer of the promissory note of Jenks Budlong for $3000, to the order of William H. Abbott, and by him endorsed. The defendant had pleaded set-off, and the offer was in support of said plea. This record does not show that the equitable plaintiff below paid value for the assignment of Budlong’s contract, nor that the defendant had notice of the transfer. Hence there was nothing to prevent the latter from making use of the note in question as a set-off if he had legally acquired title thereto : Rider v. Johnson, 8 Harris 190 ; Loudon v. Tiffany, 5 W. & S. 367. Upon the question of title the defendant says in his testimony: “ I bought the note from Abbott, December 22d 1873. I got it in making some settlement, and got it then. We had a running account and made a settlement; I gave him my note for it; he did not owe me; I have since paid Abbott on it $1500; he regarded it as worthless, and agreed not to claim mine if I did not get this set-off. The $1500 was paid this year (1874) on a settlement in another matter.” Upon this evidence the court below excluded the note, which was error. It is true, if the defendant had obtained the note as a mere experiment, with an agreement to return it in case he failed to get it in as a set-off, its rejection would have been proper. But the evidence does not go to this extent. .It discloses no agreement [473] to return the note. That Abbott regarded Budlong’s note as worthless, and agreed not to claim on McGowan’s note, given therefor in case the set-off was not allowed, is not material; Abbott had a right to give the note to McGowan, and the latter’s right to use it as a set-off against the maker does not depend upon the fact of its worthlessness. The question of the consideration of the transfer could not have been raised by Budlong bad McGowan sued him upon the note. Nor can such question be raised when the note is offered as a set-off. Budlong was liable upon it in either event. It was for the jury to say whether there was an actual transfer of the note to the defendants, or whether it was a mere experiment; and it was error to withdraw this question of fact from them. Judgment reversed, and a venire facias de novo awarded.