Newton v. Turner

Porter, J. delivered the opinion of the court. The plaintiffs, endorsers of a promissory note executed by the defendants, sue them to recover the amount thereof, with interest and costs of protest. The defendant of° arornissory quire whether the the^iegniTitiof is ogont7nor’ °r 18 The answer denies that the plaintiffs are the owners of the note; and avers, that it is still the property of Campbell, the payee. Compensation is also pleaded m a note oí Camp-]->eipSj all(j an account due by him to the defendants. Interrogatories were annexed to the answer, calling on the plaintiffs to'swear whether they were the true and bona Jide owners of the note; at what time it was transferred to them; and whether Campbell, the payee, was not still the true proprietor of the instrument sued on. These interrogatories were excepted to'; because they were not pertinent; because the note sued on has the endorsement of the payee, which gives the plaintiffs a complete right of action; because the answer contains no allegation that the note was endorsed after maturity; because the note was protested for non-payment before the debts now pleaded in compensation had been due, and even before one of them had been contracted; because the defendants have notsub-joined the proper affidavit to their interrogatories; and, finally, because neither the execution of the note, nor its nullity, (we presume, its validity, was meant,) is called in question. The court sustained these exceptions, on the ground of the immateriality of the interrogatories, and judgment being given against the defendants, they appealed. The doctrine contended for by the plaintiffs, which has been sanctioned by several decisions of this court, we believe correct. The maker of the note, when sued, has not the right to inquire whether the plaintiff, in whom the legal title to the instrument is vested, be the agent or the owner of it. Because, whether he be the one or the other, is immaterial to the defendant, for a judgment in favor of the party, who ex facie has the title to the note, will protect him against a demand against any other person. But, this rule has its exceptions, as we stated in the case of Banks vs. Eastin, and one of these is where the defendant has substantial grounds of defence against the payee, of which he apprehends an attempt is made to deprive him by a fictitious assignment. In this case, the answer sets up what would be a good de49 fence against the payee, and it charges the assignment to be false and fraudulent. It, therefore, comes clearly within the exception just stated, unless a distinction taken by the counsel for plaintiffs, should be found correct. 3 TV. S. 291, 392. aSt* ca? dmak¿ when he ¿SS-of defence against the payee, and an attempt u made of do' It is contended, that as the debts now pleaded in compensation were not acquired until after the endorsement of the note, the assignment could not have been made to deprive the defendants of any just defence, to the instrument sued on; and, consequently, they have no right to put the interrogatories. The position assumes that the authority of the defendants to go into the inquiry, as to the real ownership of the note, depends on their having a defence against the payee, at the time of the transfer, and that this transfer was made to deprive them of the defence. We are not aware of any authority, or sound reason, on which the right can be so limited. As strongan inducement for such fictitious transfers, may exist in the apprehension the debtor will acquire obligations of the plaintiffs, as he will set off those already acquired. The fictitious assignment cannot deprive the defendants of rights which they would have had, had that assignment not been made; if the plaintiffs are but the agents of the payee, the case must be open to every de-fence against them, it would be against him. The defect in the affidavit, which is alleged in the bill of exceptions, was not relied on in argument; and on looking into the record, it does not appear to us tenable. It is, therefore, ordered, adjudged and decreed, that the judgment of the District Court be annulled, avoided and reversed ; and it is further ordered and decreed, that the cause be remanded to the district judge, with directions to him to overrule the exception filed to the defendants’ interrogatories; and it is further ordered, the appellees pay the costs of this appeal.