Herbert v. Huie

ORMOND, J. — The law is well established, and is admitted by the counsel for the plaintiff in error, that if a note is signed [20] in blank and entrusted to another, in the confidence that it shall be filled up for a particular amount, or used in a particular mode, and that confidence is abused by the insertion of a larger amount, or by making an improper use of the instrument, that the instrument will, notwithstanding, be valid, in the hands of a bona fide holder for a valuable consideration. But it is insisted that the present case is distinguishable from that, because in this instance, the note was not filled up by Porter, to whom the blank was delivered, and in whom the confidence was reposed. The argument is, that the authority to fill up the note is given to Porter alone, and that the power can not be delegated. It is true, that when a blank note is signed and delivered to ■another, for the purpose of being filled up, authority must, of necessity, be conferred to do the act, without which the note could be of no value ; but to deduce from this presumption an argument that the note when filled up and in the hands of a bona fide holder, can be sustained alone on this ground, is not correct. The rule by which a recovery in such a case is allowed, stands on a much broader ground — and may be thus stated. That where one of two innocent persons must sustain a loss, he must bear it who is most in fault. If, by misplaced confidence, one enables another to commit a fraud, it is but just he should pay the penalty of his own indiscretion : and that the loss should not be visited on another who, has vested his money on the faith of the genuineness of his signature, without the means of ascertaining the fraud which bad been committed. These being the principles which govern the case, it follows that, the implied authority is given to the holder to fill up the note, with any amount which he may have advanced on it, in good faith, and without the knowledge of any fact which might lead to an inquiry and expose the fraud. This principle as has been stated is well settled and to permit it now to be questioned, would be of most mischevious consequence. [See Brahan & Atwood vs Ragland, 3 Stewart 247; Putman vs Sullivan, 4th Mass. 45; Violett vs Patton, 5th Cranch [21] 142; Russell vs Lanstuffer, Douglass Rep. 496, and Roberts vs Adams and cases there cited, 8th Porter 297.] It is also maintained, that as the defendant in error received the note, as collateral security for the payment of an existing debt due from Ross & Ford to him and gave no other consideration for it, that he cannot be considered a bona fide holder for a valuable consideration. This is an objection entitled to great weight, and would, perhaps, be decisive of this question, if the predicament of the record was such as to permit itnow to bemade. Neither of the charges moved for by the plaintiff in error raised this question before the jury, they are both predicated on the idea that the note was void, because not filled by Porter, to whom the blank was entrusted, and therefore,, properly refused. But it is supposed that the charge given by the court, authorizes this point to be made here. The charge of the court merely states the law as laid down in this opinion. It is true, the court say, that to enable the plaintiff to recover, he must be a bona fide holder for a valuable consideration, but whether the facts, if true, would constitute him a bona fide holder for a valuable consideration, was a question not raised before the court, or argued to the jury, so far as we can judge, from anything appearing on the record. If the court refuse to give a charge, improperly asked for, and then charge the jury wrong in point of law, the case must be reversed. But that is not the fact, here the charge is right, and the objection, in effect, is that the court did not inform the jury of its own mere motion what constituted a bona fide purchase or holder for a valuable consideration. This the court was under no obligation to do. The consideration of that matter as would appear from the record, was waived by the party interested in its ascertainment. The verdict of the jury has ascertained that the defendant in error was a bona fide holder of the note, for a valuable consideration, and it is not the province or duty of this court to examine the facts set out in the record, and revise their decision. There is no error in the record, and the judgment must be affirmed.