First Nat. Bank of Council Bluffs v. Moore

GILBERT, Circuit Judge (after stating the case as above). In the view which we take of the law of this case, it becomes unnecessary to consider the question whether the written assignment of the notes was properly executed or was admissible in evidence. The complaint contained the allegation that the notes had been assigned and delivered to the plaintiff in error. The testimony showed that the notes in question were transferred and delivered by the Citizens’ State Bank to the plaintiff in error long before the written assignment was made. No objection was interposed to the admission of this testimony on any ground, and it was, we [507] think, prima facie sufficient under the pleadings to sustain the right of the plaintiff in error to recover on the notes. The objections that were made were to the admission in evidence of the written assignment, and to the testimony tending to show that Turner was authorized by the cashier of the Citizens’ State Bank to sign his name thereto. In the absence of a statute to the contrary, a written assignment of a negotiable promissory note payable to order is unnecessary. An assignment by parol is sufficient. 7 Cyc. 834. And while the title so transferred is equitable, and is subject to the defenses which the maker might have made prior to notice of the transfer, and under the old system of pleading and practice, an action to recover on the note could be prosecuted only by the holder in the name of the payee .(Jones v. Witter, 13 Mass. 304; Minor v. Bewick, 55 Mich. 491, 22 N. W. 12; Coombs v. Warren, 34 Me. 89; Freeman v. Perry, 22 Conn. 617; Martin v. Martin, 174 Ill. 371, 51 N. E. 691, 66 Am. St. Rep. 290; Davis v. Lane, 8 N. H. 224; Waters v. Millar, 1 Dall. 369, 1 L. Ed. 180), under the code system, by the very decided weight of authority, a negotiable unindorsed promissory note, payable to order, may, for a valuable consideration, be assigned by mere delivery, so as to give the transferee the right to recover thereon in his own name. Williams v. Norton et al., 3 Kan. 295; Pease v. Rush, 2 Minn. 107 (Gil. 89); Billings v. Jane, 11 Barb. 620; Savage v. Brevier, 12 How. Prac. 166; Boeka v. Nuella, 28 Mo. 180; Quigley v. Mexico Southern Bank, 80 Mo. 289, 50 Am. Rep. 503; Fultz v. Walters, 2 Mont. 165; White v. Phelps, 14 Minn. 27 (Gil. 21), 100 Am. Dec. 190; Cassidy v. First National Bank, 30 Minn. 86, 14 N. W. 363; Fox v. Harrison National Bank (Kan. App.) 50 Pac. 458; Beard v. Bedolph et al., 29 Wis. 136; Moore v. Miller, 6 Or. 254, 25 Am. Rep. 518; Harrisburg Trust Co. v. Shufeldt, 87 Fed. 669, 31 C. C. A. 190. The notes in controversy were made and transferred in the state of Iowa. We find no statute of that state which requires that such an assignment be in writing, nor have the courts of that state so held. On the contrary, it seems to have been there settled by the adjudications that not only may such an assignment be made by parol, accompanied by delivery, but that the assignee of such a note, so transferred, may maintain an action in his own name to recover thereon. In Conyngham v. Smith, 16 Iowa, 471, it was held that the assignee of a bond by parol contract of assignment may maintain an action thereon in his own name. In Younker v. Martin, 18 Iowa, 143, in an opinion rendered by Judge Dillon, it was held that the transferee by delivery, without indorsement of a promissory note payable to order, may maintain an action thereon in his own name, but without prejudice to the maker’s right of set-off of equities existing before notice to him of the transfer. The court said: “Notes are choses in action—that is, things which must be recovered by action at law—and, like all other things in action, they may be assigned and the title will pass without indorsement.” The doctrine of that decision was reaffirmed in Pear [508] son v. Cummings, 28 Iowa, 344, and Switzer v. Smith & McGowen, 35 Iowa, 269. It is our judgment, therefore, that the judgment be reversed, and the cause remanded to the court below for a new trial.