Hudson v. Emmons

Grant, J. {after stating the facts). 1. The first point raised is that the note is not a negotiable instrument on account of the statement upon its back, signed by the defendant. This statement did not affect the negotiability of the note. It did not change the date, amount, or time of payment, or rate of interest. Citation of authorities is unnecessary. The note was negotiable. 2. This note was transferred by Clavey, together with other property, to secure a past-due indebtedness from Clavey to plaintiff. Plaintiff foreclosed the security, and thus obtained title. It was conceded upon the trial that the defendant was entitled to make the same defense as if the note were in the hands of Clavey. Clavey, for a full and valuable consideration, purchased the note from Arbuckle, Ryan & Co. before due. It appears by defendant’s own testimony that Arbuckle, Ryan & Co. had nothing to do with the agreement set up with the plea. It [552] also conclusively appears that Clavey had no authority from the company to make any such agreement, and that it had no knowledge thereof. Defendant’s own evidence shows an agreement with Clavey alone, and it was that Clavey should procure from the company and deliver to him these two notes, and take the engine and fixtures, which defendant was to deliver in the spring, and which remained in defendant’s possession until the latter part of April or first of May, 1893, when the property was seized by Clavey, under the direction of the company, upon the chattel mortgage given to secure the payment of the four notes, one of which the company still owned, and which was unpaid. May 18, 1893, due notices of the foreclosure sale were posted, and on May 27th it was sold,- and bid in by the company for sufficient to satisfy the amount of the note. The court directed a verdict for the plaintiff, stating that Clavey took the note for a valuable consideration, and that the agreement set up and testified to was void under the statute of frauds. Defendant admits he did not deliver the property, and claims that the roads were not, in his judgment, good enough to justify delivery at the place mentioned. It is also claimed that the seizure by Clavey amounted to a delivery, or, in other words, estops him to assert that the parol agreement was not executed, in that no delivery was made. Defendant failed to prove the agreement set up in his notice. He alleged an agreement with Arbuclde, Ryan & Co. and Clavey. He testified to an agreement with Clavey alone. He could not have recovered in a suit upon a declaration alleging a contract with the two and proving a contract with one alone. The same rule applies in setting up the same contract as a defense. Having failed to prove it as alleged, his defense falls. 3. The contract, as claimed by defendant, was one of sale. It rested entirely in parol. There was no delivery nor part performance to take it out of the statute. It was of no binding force until the property was delivered. [553] Webster v. Bailey, 40 Mich. 641. Clavey seized the property by direction of the company under the chattel mortgage. There was no agreement that Clavey might take the property. If Clavey had taken it without permission of defendant under the alleged parol agreement of sale, and defendant had replevied it, and Clavey had set up this contract, the obvious reply would have been the statute of frauds. The parol agreement could bind neither party until there had been delivery and acceptance. Un; til such delivery, either party could refuse to carry out the parol agreement, and set up in defense the statute. The judgment is affirmed. McGrath, C. J., Long and Hooker, J.J., concurred. Montgomery, J., did not sit.