Marion Manufacturing Co. v. Bowers

The opinion of the court was delivered by Clark A. Smith, J.: If the notes and mortgages were executed and delivered by the defendants to the plaintiff as alleged in the petition, a defense founded upon any warranty or transaction with the Western Supply and Manufacturing Company or Giger, as agents for the plaintiff, would require as a prerequisite that the fact of such agency, and the extent thereof, be first proved. If, however, the notes and mortgages were executed and delivered to the Western Supply and Manufacturing Company in a transaction between that company and the defendants, but at the instance of the supply company were made payable to plaintiff, then there could be no agency, and of course proof thereof would not be requisite. In the latter event, the plaintiff ■ would take the notes and mortgages subject to all defenses that could be set up against the Western Supply and Manufacturing Company. Such a transfer of the notes would not cut off equities and defenses. The trial court overlooked this feature of the case, and sustained a demurrer to evidence that was sufficient to establish a partial defense. The court also indicated to the defendants that it would be useless to [263] offer any further testimony without further proof as to the extent of the agency of the Western Supply and Manufacturing Company and Giger. The court, in effect, reversed the ruling on the demurrer, and vacated any judgment that may have been rendered, by granting a new trial. Under the circumstances a new trial is certainly in the interests of justice, and, as the granting thereof was largely in the discretion of the court, we cannot say that it abused that discretion because it assigned a different reason for granting the motion than we might have assigned. The court had misapprehended the issues, had made erroneous rulings by reason thereof, and had by intimation debarred the defendants from offering further evidence. It granted the defendants a new trial on the ground of surprise. We cannot say they were not surprised. It is evident that they were debarred from having a fair trial. The order granting a new trial is affirmed. All the Justices concurring.