Hawley, Stirling & Co. v. Stirling

Appeal from the Fourth Judicial District.

The complaint sets forth that the plaintiffs were partners in trade under the firm of Hawley, Sterling & Co. That defendant on the 27th July, 1850, made his promissory note for S|1000, payable three months after date, to the order of Stewart and Cooke; and at the same time made another note for $1000, payable six months after date, to the same parties—who endorsed them on the same day to Heyden and Mudge, who endorsed them over on the same day to the plaintiffs—both endorsements for a sufficient consideration; and for the recovery of which notes this suit was brought.

Defendant’s answer denies all responsibility on the said notes; and denies that Stewart and Cooke endorsed the said note on the same, or any other day, for a sufficient consideration to Heyden and Mudge, or that Heyden and Mudge on the same, or any other day, endorsed them for a sufficient consideration to the plaintiffs; and avers that if plaintiffs ever had possession of the said notes, they were placed in their hands as a collateral security; and that Stewart and Cooke never bona fide parted with them, and denies notice of the transfer of said notes to plaintiff. And further says, that between the 1st August, 1850, and the 6th October next, thereafter, upon a settlement of accounts with Stewart and Cooke, they were ascertained to be indebted to defendant $3,345.19, as will appear by the annexed account; and avers, that if the said notes were assigned to plaintiffs, they well knew of the indebtedness of Stewart and Cooke to defendant, and received the same with full knowledge of the equities which existed in favour of defendant. And if plaintiffs establish any liability against him, defendant asks to be allowed to plead the indebtedness of Stewart and Cooke to him, as above stated.

On the 2d June, the deposition of Heyden taken on interrogatories filed by defendant, was filed, who testified that he is one of the firm of Heyden and Mudge, and that Stewart and Cooke transferred the notes bona fide to Heyden and Mudge; that he knew Stewart and Cooke, who had left this for the Eastern States; that the notes were not placed by Stewart and Cooke in the hands of Heyden and Mudge, in trust, nor as collateral security for any debt which Stewart and Cooke owed to Heyden and Mudge. That the notion of the transaction was, that it was agreed, upon defendant paying the notes, and another note of $1000, to Heyden and Mudge, they were to relinquish their right, title, &c., in a certain mortgage by Stewart and Cooke to Heyden and Mudge. Stewart and Cooke was indebted to witnesses’ firm about $20,000.

Witness further said, that “their notes were in the first place given by deponent to Hawley, Stirling & Co., as a collateral security;” at a later period, he transferred the notes to them&ow« fide; cannot give the date of the transfer, “but thinks it was after the maturity of said notes,” or about the time the second note become due. The notes were not protested for non-payment to deponent’s knowledge—he does not know why. Hawley and Stirling held the notes at the time they became severally due.