Bills and Notes, Holder in due course, Indorsement. Practice, Civil, Findings by trial judge, Exceptions, Requests for findings.
Where an action at law was heard by a judge without a jury and the judge finds generally for the plaintiff, such finding is conclusive if there was any evidence to support it.
A judge hearing an action at law without a jury is not bound to act upon requests for specific findings of fact.
The facts, that, upon the indorsement and delivery by the payee of a negotiable promissory note, the indorsee, on an order in writing by the payee directing him "to pay the proceeds of the discounting or purchase" to a third person, with the consent of such third person charges the amount thereof to the third person's credit in an account between the indorsee and the third person wherein the balance was in the indorsee's favor, constitute a consideration for the indorsement.
The fact, that an indorsee of a negotiable promissory note took title to the note with knowledge that it was given as a part of a conditional sale of a motor truck containing certain covenants, warranties and guaranties to be performed by the payee and indorser of the note, does not prevent the indorsee from being a holder in due course under G.L.c. 107, § 80, where it does not appear that at the time when he received the notes as indorsee he had notice or knowledge of a breach of any of such covenants, warranties or guaranties.
De COURCY, J.
The defendant bought a Gramm-Bernstein motor truck from Wayland L. Sturtevant, a Boston dealer, on a conditional sales agreement. The purchase price was $5,936; of which $2,500 was paid in cash, and the balance was payable in monthly instalments of $200 each, represented by promissory notes. Sturtevant indorsed the notes and assigned the sales agreement to the plaintiff, a banking concern which did an extensive business in automobile financing with dealers. The plaintiff, by letter dated September 25, 1917, notified the defendant that it had purchased the notes. The defendant paid those maturing each month until April, 1918, when it refused to make further payments. This action was brought to recover on the unpaid twelve notes, which had become due and payable by the terms of the agreement. The judge of the Superior Court, sitting without a jury, found for the plaintiff for the full amount of its claim.
The judge's general finding is conclusive if there was any evidence to support it. Bill v. Stewart, 156 Mass. 508. Bailey v. Marden, 193 Mass. 277. He was not bound to make specific findings of fact, as requested in the defendant's so called "request for rulings," numbered 2, 3, 4, 5, 6, 8, 9 and 10. Puffer Manuf. Co. v. Yeager, 230 Mass. 557, 563.
We cannot say that the judge erred in refusing to rule (request 12) that "On all the evidence the plaintiff was not a holder in due course." The first two requisites, namely, that the notes were complete and regular upon their face, and that the plaintiff became the holder thereof before they were overdue, were not in controversy. The third element is, that the plaintiff took the notes "in good faith and for value." R. L. c. 73, § 69. The good faith was not questioned. And there was ample evidence of consideration in the payment of the proceeds of the notes, by the, express authority of Sturtevant, to C.W. Moody, who was distributor for the Gramm-Bernstein company in New England. Moody applied this on his indebtedness to the plaintiff arising out of a certain other transaction, and thereby secured a renewal of his notes amounting to some $60,000, due to the plaintiff. That is sufficient consideration to make the plaintiff a holder for value. Fulton National Bank v. Gosline, 168 Mass. 86. Montrose Savings Bank v. Claussen, 137 Iowa, 73. Mechanics Bank v. Chardavoyne, 40 Vroom, 256, 261. Wallabout Bank v. Peyton, 123 App. Div. (N.Y.) 727. National Bank of Commerce v. Armbruster, 42 Okla. 656. The assumption, in the "additional ruling requested," that this application of the proceeds of the defendant's notes was "without agreement with Moody" (assuming that the defendant can raise this point), is negatived by the fact that Moody paid in cash the difference between these proceeds ($2,647.20) and the $5,000 then payable by him to the plaintiff.
The fourth requirement to make the plaintiff a holder in due course is, that at the time the notes were negotiated, it "had no notice of any infirmity in the instrument or defect in the title of the person negotiating it." The only "infirmity" or "defect" suggested by the defendant is that as the notes were accompanied with the sales agreement, the plaintiff took title to the notes subject to any claim the defendant has under that agreement. The only present or prospective claim of the defendant that was brought to the attention of the plaintiff was the "Manufacturer's usual warranty," referred to in the sales agreement. That was limited to "furnishing at our factory of such parts of the motor vehicle as shall, under normal use and service, appear to us to have been defective in material or workmanship." No notice of any breach of this "warranty" was ever given to the plaintiff. The broader special warranty which Sturtevant gave the defendant never was called to its attention. While the plaintiff bought the notes September 25, 1917, it was not until April 12, 1918, and after several of the notes had been paid, that the defendant made any complaint whatever to the Commercial Credit Company. The fact that the plaintiff took the notes with notice of the executory agreement in said sales contract does not prevent it from being a holder in due course unless it also had notice of the breach of that agreement. Piedmont Carolina Railway v. Shaw, 223 Fed. Rep. 973. Hakes v. Thayer, 165 Mich. 476. Baker State Bank v. Grant, 54 Mont. 7. McNight v. Parsons, 136 Iowa, 390. Citizens Bank Trust Co. v. Limpright, 93 Wn. 361.
The judge was warranted in finding that the plaintiff was a holder in due course. Accordingly it held the notes "free from defences available to prior parties among themselves." R. L. c. 73, § 74. G.L.c. 107, § 80. It is unnecessary to consider what remedy the defendant may have against Sturtevant or the Gramm-Bernstein Motor Truck Company, for breach of warranty or failure of consideration.
Exceptions overruled.