Dearth v. Hide & Leather National Bank

Chapman, C. J. It appears that Page, Briggs & Babbitt went into insolvency January 10,1861, being at the time indorsers of a promissory note which had been made by the Portland Company to them or their order, and had been indorsed by them and discounted for them by the defendants. This note was proved by the defendants in the court of insolvency, and they received thereon a dividend amounting to $457.81. The payment of this dividend would not entitle the assignees to the possession of the note in order that they might collect the amount of the Portland Company, for whom they had paid it; but it would give them an equitable interest in the note in the hands of the defendants, to the extent of the payment. In order to make a [543] definite arrangement on the subject, the defendants made with the assignees the agreement dated August 22, 1861. The defendants alleged in their answer, that, when they received their dividend, the note had been delivered to the promisors, and that they had taken a new note for the amount. The effect of giving up the old note, and taking a new note to themselves, was to extinguish the original debt, and substitute a new debt in which the assignees could have no interest. As between the defendants and the assignees, it was equivalent to a collection of the debt. But not being satisfied with this answer, the defendants moved to amend it, though it had been sworn to. The amended answer failed, however, to state the facts as they are now admitted by the defendants to have been. This is a conclusive objection against granting the proposed amendment. One of the facts which it is contended are therein correctly stated is that the defendants have since sold the note in open market. While such a sale would be an appropriation of the note to the use of the defendants, as against the plaintiff, it would not bind the plaintiff, but would entitle him to regard it as paid. Fletcher v. Dickinson, 7 Allen, 23. It would not, therefore, constitute a good defence. But the defendants contend that the plaintiff cannot maintain this bill because he has a plain, adequate and complete remedy at law. Such an objection must be made without delay and at the earliest opportunity. Being an objection to the jurisdiction, it is too late to make it after the jurisdiction has been submitted to. First Congregational Society in Raynham v. Trustees, &c. 23 Pick. 148. The objection should be made by plea or demurrer, or distinctly stated in the answer of the defendant; and a submission of the case on an agreed statement of facts is a waiver of the objection. Russell v. Loring, 3 Allen, 121. The case was heard on bill, answer and proofs, and the point was not raised at the hearing, and is not reserved in the report. It must therefore be regarded as waived. Decree for plaintiff for amount of dividend, and interest from filing of bill. [544] A motion was subsequently made that interest be allowed from the time of the payment of the dividend ; but as this claim had not been previously made, the motion was denied.