Starr v. Yourtee

Le Grand, G. J., delivered the opinion of this court. This was an action brought by the appellant, as endorsee, [348] against the appellee, as endorser of a promissory note, made by Howard Paceley, payable to William C. Kirkhart, endorsed by the names of William C. Kirkhart and Aaron B. Yourtee, the appellee. The note was regularly protested, and the parties duly notified. The defence was, that the name of the appellee had been forged in the endorsement of the note. The plaintiff offered five prayers, the first two were conceded, and the others rejected. The facts of the case, so far as developed by the record, and necessary to be considered in connection with the propositions of law embraced in the prayers, may be thus stated: It appears that a certain William Johnson agreed to do work on a mill for Howard Paceley, for which he was to be paid, according to the terms of the contract, cash, but by a subsequent arrangement, he agreed to accept and did accept, in lieu thereof, the note which is the subject of controversy in this suit. The note, according to the testimony, was delivered to Johnson on the day on which it bears date, having the endorsement of bolh Kirkhart and the appellee, Yourtee, on it at the time. There is no question as to the genuineness of the signature of the maker, nor of that of the endorsement by the payee, Kirkhart. It is conceded that the endorsement in the name of Yourtee is a forgery. The right to recover as against Yourtee, is rested entirely upon the ground that his conduct in regard to the note, whilst it was in the possession of Johnson, was such as to make him responsible to an'innocent holder for value. The solution of this question of course depends wholly upon the evidence, and especially upon the declarations of Yourtee, in regard to the note. It may be here remarked, that the note was passed to the present holder of it, the plaintiff, without any endorsement on the part of Johnson. Two witnesses testify as to conversations held with the defendant, touching the note, the genuineness of the endorsement in his name, and his responsibility because of such endorsement. The witness, Bateman, states that sometime in January 1858, he accompanied Johnson on a visit to the de [349] fendant, and that during the conversation which then took place, “Johnson handed to the witness the note sued on in this case, which lie said was the same note which the witness then read; he then turned it over and read the name of William C. Xirkhart endorsed on it, and something was said about it; he then read Aaron B. Yourlee’s name, and asked Mr. Yourtee whether it was his name, and he said it was his name; he neither said nor intimated that it was not his.” Witness further says that during the same conversation, “he read the name of Aaron B. Yourtec, and asked him (the defendant) whether it was his name, and he said it was bis name; thinks the note was not handed to Yourtee, but he saw it. In this conversation Johnson spoke to Yourtee about taking the amount in payments, if he would make it safe to him, and Yourtee replied, it was kind in him. Witness had no suspicion about the signature being genuine, as he knew nothing about it.” The witness, Johnson, after detailing how he became possessed of the note, and under what circumstances he endeavored to get rid of it, proceeds to say, that “he saw Mr. Yourtee some months after he got the note, meeting him on horse-back. He showed him the note and his name on it, and at first Mr. Yourtec said he did .not recollect when he signed it. Witness then required him to say distinctly whether it was his signature or not, because if it were not his, he would have a legal investigation about it. Mr. Yourtee said, in reply to this, ‘I won’t say it is not mine,’ and added that lie would see Paceley about it. He told Mr. Yourtee he wanted to use it, and if he agreed to renew the note, he would deduct from it a small amount which Paceley claimed, and which he was willing, in that event, to allow — - about twenty dollars. He declined giving a new note without seeing Paceley. The witness met the defendant after-wards, near his house, and before Paceley left Washington county, when the defendant told witness he was satisfied the note would be met at maturity; that he bad talked with Paceley about it, and Paceley said he need have no fears, that he had made arrangements with Mr. Eoss, in Baltimore, to meet it. Witness then asked defendant if he, defendant, was in [350] the habit of endorsing for Paceley? He replied he was not; ’ that this was the first time he had endorsed for him, and it should be the last for him or any body else.” On cross-examination, he says, that ££the note was his; he sold it to the plaintiff for sixteen pair of mill-burrs. ^ * When he delivered the note to the plaintiff, he informed him that the defendant, Yourtee, was good, and also what Paceley had said about it. * * * Witness never had any doubt about Mr. Yourtee’s signature, as Mr. Yourtee told him it was his; # # * he never told witness that his name was a forgery, but in the conclusion of the first conversation he could not say it was not his.” From this synopsis of the testimony, and it contains all which is pertinent to the inquiiy before the court, it is plain that Johnson originally received the note in full faith, without inquiry as to the genuineness of the endorsement of the defendant, and that he passed it away to the holder, the the plaintiff, without communicating to him any of his suspicions, if any he had, as to its not having been endorsed by the defendant, and also without communicating to the plaintiff any knowledge of the conversations which had taken place between the witness and the defendant in regard to the note. There is, undoubtedly, sufficient in the evidence to have authorized the plaintiff to have gone before the j ury as to the fact of the genuineness of the endorsement of the defendant, and this, by the granting of his first prayer, he was permitted to do. But there is now no such question before us on the prayers; besides, it was expressly conceded, in the argument, that the name of the defendant, on the note, was a forgery. The only question, then, for our determination is: Do the statements of the defendant, as testified to by the witnesses, Bateman and Johnson, make him responsible to the plaintiff on the note ? It is clear, on the testimony, that the plaintiff received the note wholly uninfluenced by anything which the defendant had said or done in regard to it; and it is equally obvious that [351] Johnson originally obtained possession of it without any such knowledge. (Decided Oct. 10th, 1861.) If the defendant be denied the privilege of setting up the forgery as a defence, it must be upon the ground of estoppel $ an estoppel in pais. The true rule is this, that whilst the admissions of a party are strong evidence against him, when invoked on behalf of a party whose conduct was influenced by them, they are of no avail to the advantage of an entire stranger to them, and the party making them, as against a stranger, may show that they were founded in mistake, in accordance with this principle, the plaintiff cannot maintain this action; he was in no degree influenced or damnified by any thing which the defendant said or did in regard to the note; his action was wholly independent of that of the defendant.. In principle, this case is the same as that of Lancaster vs. Baltzell, 7 G. & J., 468. That was an action of the endorsers against the maker of a promissory note, and the defence was, that the endorsement of the name of the payee was a forgery. It appeared that after the note came into the possession of the endorsees, the maker was called upon, who examined the endorsement and said it was right. The court say, in regard to this state of case, that “the only question, then, in this case, is, whether, if after the endorsements had been made, the defendant, on the note being presented to him by the counsel of the plaintiffs, examined the endorsements and said it was right, that makes any difference? And we think it does not. By saying so, he gave no credit to the note; and did not thereby induce the plaintiffs to take it.” In the same opinion, the court elsewhere say, “if one is to suffer, the loss should fall on him who is most in fault, or most negligent.” * Entertaining these views in regard to the case, we are of opinion the court correctly rejected the third, fourth and fifth prayers of the plaintiff. Judgment affirmed.