Baker and Rowlson against Richard and Henry Arnold

Baker and Rowlson against Richard and Henry Arnold. NEW-YORK, Nov. 1805. ASSUMPSIT by the indorsees against the makers of a note, for ^‘330, dated March the 31st, 1796, payable on the 31st March, 1799, with interest from thence, to Roszoell Lombard, or order, with an indorsement' to the plaintiffs in these words : “ Pay the within note to Erastus Baker and “ Sylvester Rowlson value received, March 30th, 1799, Ros- “ well Lombard.’’’’ On the trial, the hand-writings of the defendants and payee being admitted, the plain tiffs there rested their cause. Tne defendants, to establish that the indorsement was made after the note was due, and thus afford an opportunity of impeaching the consideration, by letting in their equities, called the indorsor himself, who, after some objection as to his competence, was, on the authority of the former decision in this case, received by the court. Lombard then testified, that before the instrument became payable, he sold it to one Holt, for Susquehannah lands, lying in the State of Pennsylvania, within the Connecticut claim; but that he did not then indorse it over, nor did he ever know that the note was in the hands of the plaintiffs, or that they had any interest in it till June, 1799, when he was called on by one Elmer, on behalf of the plaintiffs, with a request to indorse it, which he refused, and that he did not till the September after, upon a second application, yield to the persuasions of Elmer, a Mr. Pepoon, and one of the plaintiffs, by putting his name on the back of the note. This, however, he swore was done in blank, with a knowledge of the consideration on which he had parted with.it to jETo/í, and that at the same time, it was mentioned, a suit had been commenced against the defendants. The way being thus prepared for investigating what had passed from him, when the note was given to the defendants, they called one Gardner, a subscribing witness to the instrument, and he deposed that the consideration was, like that for which it had been indorsed, Susquehannah lands, lying within the Connecticut claim, in Pennsylvania. In an action by-a bona fide holder of a note taken before due, against tire maker, the consideration cannot be inquired into, if the instrument be not in its creation void. The letters of an indorsor may be adduced to contradict bis testimony as to the time of his indorsing, and it is for the jmy to determine whether his oath or letters are to be credited. To rebut this testimony, and impeach Lombard’s credit, ^ Pontiffs gave in evidence the following letter, to the defendants, signed by Lombard himself. “ Slockbridge, May 31, 1797. Messrs. Richard and Henry Arnold., “ Gentlemen, “ This may certify that I have sold the obligation which “ I held against you. I sold it to Mr. Jacob Holt, of Ca- “ naan, in Connecticut, and I have received a line from Mr. “ Holt, wishing me to transfer the obligation to Erastns Ba- “ ker, and Silvester Rorulson, mentioning in the line, that he “ has received property to the amount of the obligation, and tc transferred by me, Roswell Lombard.” They also produced the letter of the 4th of March, 1799, from the defendants to the plaintiffs, set forth in the former report of ibis casey and another of 19th of April, 1799, still offering to settle on the same terms, but threatening, if they were not accepted, a defence, which should prevent all recovery. The plaintiffs also produced a witness, who deposed that he was present when Holt disposed of the note to them, and understood from Holt and Lombard, and the defendants, the consideration, both for the transfer and making of it, to have been lands in Canada, a tract of which he had himself sold to the plaintiffs, who, by another pei’son, proved, that in the beginning of March, 1799, one of the defendants acknowledged the note to be an honest debt, and that he had then come to make provision for its discharge. On the part of the defendants Lombard was again called, and swore he never had said the note was given for lands in Canada. The judge, on charging the jury, said, the first question for them to. determine was, whether the note was indorsed after due ? That Lombard had sworn positively to this, but how far he was to be credited, was, under the circumstances of the case, for their determination, as the fact, with respect to the time of indorsement, came within their province to determine. If they believed it to be before the note was due, the plaintiffs were entitled to recover, as the consideration could not then be impeached. If, on the other hand, the indorsement was after the day of payment, their verdict, should they be of opinion the consideration was Susquehannah lands, ought to be for the defendants. The jury having found for the plaintiffs, application was now made to set aside the verdict on two grounds. 1st. On account of misdirection in leaving the date of the indorsement to the jury. 2d. Because the verdict was against law and evidence. Woodworth, for the defendants, argued, that on the first point there could be very little hesitation, for, from the decision on the first appearance of these parties before the court in 1 N. Y. T. R. 275, it appears the date of an in-dorsement, is perfectly immaterial, and yet from this circumstance, the jury were left to infer against the defendants, though the actual period at which it was done, lay, necessarily, within the knowledge of Lombard, and the insertion of the date, may well be the act of the plaintiffs. As to the verdict, he said it was against the weight of testimony, none of which went to impeach Lombard’s credit. Henry contra, cited Peacock v. Rhodes to shew that in the hands of bona Jide holders of negotiable paper, not void ab initio, the consideration was not inquirable into, if the instrument was received before due ; this, he contended, appeared from the dates of the defendants’ letters to the plaintiffs, and the incredibility of Lombard’s testimony, which stood contradicted by the indorsement, and his letter of May, 1797. That at all events, he had parted with the note before due, and the mere act of indorsing being pnly what ought to have been originally performed, equity would consider it as having taken place, and a court of law permit it,, at any time, to be done. Smith Vo Pickering, Peake, Ni. Pri. Ca. SO. 1 Vol.258. 1 vol 259 260. Doug. 633. [MAJORITY — Thompson, T. LivingstoN, J. Kent, C. J.] Thompson, T. The misdirection complained of, so far ' r , , , , , , . as I have been able to understand it, irom the points made in the case, or from the argument of the counsel, is, that the indorsement upon the note, and the certificate of May, l^g/, which both speak a language, directly contradicting the testimony of Roswell Lombard, were submitted to the jury as facts, in any measure, impeaching the veracity of Lombard, or the correctness of his memory. This objection appears to me altogether unfounded. It was deemed all-important to the defendants, and the turning point in the cause, to ascertain the time when the indorsement was made, whether before or after the note became payable. l.ombard, the indorsor, swore he made it after the note fell due, though it purported to have been made before. It was admitted by the witness himself, that the indorsement was not in blank; that it was filled up when he signed his name; and from inspection, I think it .is pretty evident, that the whole indorsement is his hand-writing. Here then, we have his oath one way, and his declaration in writing, the other; and it would be a little extraordinary, if a jury were not permitted to contrast the two, in order to determine which was correct. Had the indorsement been in blank, it might have altered the complexion of the case. Is it not every day’s practice, to give in evidence, decla-tions made by witnesses, at other times, inconsistent with their testimony, in order to impeach their credit? Aman is bound to tell the truth at all times, whether under oath or not; and Ishould hardly suppose,that because the story was committed to writing, it would excuse the falsehood; and if not, it was certainly a circumstance operating against the credit of Lombard. If it was not true that he made the indorsement, when it purports to have been made, his motives must have been fraudulent, and the indorsement antedated, for the purpose of precluding the defendants from a just defence. If a man, coming into a court of justice, and thus testifying the facts, which expose his own turpitude, does not render himself suspicious, I am at a loss to say what would. His oath stands directly contradicted by his .own acknowledgment in writing, in another particular. He swears positively and unequivocally, that he never knew or heard that the note was in the hands of the plaintiffs, or that they had any interest m it, or contemplated purchasing it, until after it became due; whereas, he certifies, as early as May, in the year, 1797,that Hit, to whom he had sold the note, had written him a letter, informing him that he, Holt, had sold it to the plaintiffs, and requesting him, the witness, to indorse it to them. These are circumstances, in my judgment, tending strongly to impeach the credit of Lombard. But it was peculiarly within the province of the jury to determine the credit due to him_ which they have done by their verdict. If Lombard was unworthy of credit, the verdict cannot be said to be either against law or evidence. It is admitted, that if the indorsement was made when it purports to have been, the consideration could not be impeached. My opinion, therefore,, is, that the motion ought to be denied. LivingstoN, J. I am neither dissatisfied with the judge’s charge, nor with the jury. The first was such as the testimony called for, and so far from thinking the verdict wrong, I should not, if on the jury, have consented to any other. It is probable, they disbelieved, as they had a right to do, every word Lombard said. His conduct, throughout this transaction, discovers him to be a crafty, designing man. Although he sold the note as early as in May, 1797, yet, when he discovers he had omitted to indorse it, he makes a thousand difficulties, with a view, no doubt, of extorting a further consideration. At length he puts his name on it, and immediately after sets about defeating a title derived from himself. This is not all. He swears positively to his ignorance “ of the note’s being in the plaintiffs’ hand, or that “ they had any interest in it, or comtemplaied its purchase ‘‘until June, 1799.” And yet two years before, he had written a letter, which is part of the case, informing the defendants “ that Holt, to whom he had sold the note, is had transferred it to the plaintiffs, and wished him to “ indorse it.” Such a wilful departure from truth in otic particular, for it could not have been a mistake, warranted the jury in discrediting every other part of his testimony. R is impossible that a man who pretends to so perfect a recollection of the most minute and immaterial circumstances, and that after a lapse of several years, should have forgotten so important a fact; one too, which he had communicated in writing to the defendants. But were this a verdict against evidence, it ought not to be disturbed, because the merits are most clearly with the plaintiffs, and the defence is of the most unconscientious kind. The plaintiffs are innocent holders of this note.— They obtain it near two years before it falls due, and for a full and valuable consideration. The defendants are immediately apprized of all these facts. They treat with the plaintiffs, and that long before its time of payment had expired, and offer them satisfaction on certain terms.— Were the suit in the payee’s own name, but for the plaintiffs’ benefit, and all these matters had been disclosed, I would have protected their interests, and stopped every inquiry into consideration, the same not being such as to render the note void in the hands of a third person. A fortiori^ the indorsement, whenever made, should have been regarded particularly in support of a just debt, as relating back to the time of its actual delivery to the plaintiffs. But this, it is said, would have been in derogation of the defendants’ rights, who, if no actual indorsement took place, until after the note became due, might impeach its consideration. This necessarily leads to an inquiry into the nature of the present defence; for if such practice be correct in any state of things, which I do not admit, it ought not to apply to a case where the object of ascertaining the exact time of in-dorsement is to let in a defence against conscience, and founded in a violation of private faith. Although this court may have decided on the illegality of the consideration of notes of this description, and may not enforce their payment,.in suits between the original parties, the obligation to pay, in foro comcienUw, if the party has received value, still remains. Such is the case here. The defendants have received full value in lands, which they have probably sold to a profit, or of which they, or their tenants, for aught that appears, may now be in the quiet enjoyment. It was not alleged or pretended that the consideration had failed, although seven years had elapsed at the last trial, since the land had been conveyed to them. There are circumstances in this case, which look very much like a combination between the makers and payee of the note, to defraud the plaintiffs. The Arnolds first receive value for it, from Lombard, who takes care to sell it to Holt. When they have thus both pocketed a consideration for this paper, and sent it abroad into the world, they lay their heads together for the purpose of rendering it a nullity, in the hands of a third person. This ought not to be endured. The defendants have had two chances already; with my consent, they shall not have a third. Kent, C. J. The most material question of fact in this cause is, whether the note was or was not actually indorsed by Lo r.bard, before it became due. The 'ndorsement purports to have been made on the 30th March 1799, the day before it fell due; but to repel this evidence, the in-dorsor testifies, that it was not indorsed until some time af-terwards. He speaks positively as to the time of indorsement, and relates circumstances to confirm the accuracy of his testimony. The testimony on the part of the plaintiffs also shows, that the note was not indorsed at the time it was sold and delivered by Lombard to Holt, and by him to the plaintiffs; but it might still have been indorsed at the time the indorsement is dated. If the testimony of Lombard was unimpeached, it would be decisive; but there is one fact that materially affects the credit of his testimony. He testifies, in a very positive manner, that he never knew, or heard, that the note was in the hands of the plaintiffs, or that they had any interest therein, or contemplated purchasing it, until June, 1799 j and yet, by a letter under his own. hand, bearing date in 1797, and directed to the defendants, hfe admits he had sold the note to Holt, and that Holt had sold it io the plainrifFs. This inaccuracy in his testimony, and of which he was clearly convicted, detracts greatly from his credibility. The circumstances relative to his testimony, were fairly submitted to the jury, and the verdict may be considered as evidence, that the jury did not give credit to his testimony. I think I should have drawn a different conclusion, but still the verdict ought not, on that account, to be disturbed. It is the peculiar province of the jury to judge and determine upon the credit due to a witness, when there are circumstances contradicting his testimony and affecting his credit. Upon this ground, I am against a new trial. SpenceR, J. gave no opinion, having been concerned. Tompkins, J. concurred.