RICHMON» BAILW;AY & ELECTRIC CO.: t1. DICK.
.nte<tby Lo1;d Justice.BRETT in Phillips v. Rauway, (l)., 238, J;Q. B., Q.P. Div." .this practice Jlnd: the reasoning.of Justice BRIi;TT in of ita.re com· mendi:ldand $,pprovedbythe supreme court in Ra.uway Co. v. 118 U. S., at pages 054,555.,7 Sup. Ct. Rep. 1; and by thespprl;lme court.of in McCants, 51 Ark. 514, 11 S. W. Rep. 694. Th;e judgment below is coats, alld the cause remanded, with instruotions to dismisstbe aotion unless within a reasonable time, to be by the court below, the \iaif-brother named in theoomplaint be made· a party to the action, and in grant a new trial.
, RICHMOND RAILWAY
&: ELECTRIC Co.
t1. DICK
d
at
Oourt qf AppealB, Fourth CircuU. Ootober 11, 1811"
No. 17. L AnBALULE OU'IBs-ConIl'fl1.l.NCE. A motion for a oontinuanoe is addressed to tbe discretion' of tbe eourt, and lullOtlon thereon is not reviewable by the oirouit oourt of appeals. '. .... . a.·8AJl....NBWTBIA.L. The aotion of a federal oourt In disposing of .. motion for a new trial is not re-
viewable in tbe elrouit oollrt of appeals.
8. N'IGOTLUILB INSTRUlIElIlTII-BON.l. FroB HOLDBll8-NO'I!ICE.
AIDanufacturingoorporation ,!tloeived negotiable notes .for The notes were dllloounted by a banking firm, in whicb the presldent of the corporation was a partner, but be had no actual knowledge as to the oonsideration for the notes, or of the. transaction in which they were givj!n. Hfld, that the mere fact of his connection with tbe two oonoerna was not sumoient to affect the firm with constructive notloe of the consideration for the IlOtea and·of an alleged failure thereof.
In Error to the Circuit Court of the United States for the Eastern District of Virginia. . Action by J. R. Dick &: Co. against the Richmond Railway &: Electrio Company on certain promissory notes. Verdict and judgment for plaintiffs. New trial denied. Defendant brings error. Affirmed. Statement by SIMONTON, District Judge: The record discloses these faots: The defendant contracted to purchase two engines from the Phrenix Iron Works Company. The en· gines were to be delivered at Richmond, Va., to be paid for on arrival, one fourth in cash, remainder in notes. They, were delivered at RichIDond, the cash was paid, and three negotiable promissory notes were exeouted, payable to order of the Phrenix Company, and delivered to them. Tbesenotes bore dates and were in theatrtounts following: One for 81,500; dated 23d June, 1891; one for $1,687.50, datedlst July, 1891; one for $1,500, dated 15th July, 1891,-all at four months. The Phrenix Iron Company indorsed before maturity and delivered these notes to plaintiffs, who are a banking firma(Meadville, Pat One Of
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vol. 52.
them, (S. B. Didi\}'.atthe date of the contract and or the execution and discount of the' 'notes;'wRS president of the Phrenix Company. The notes were not paid:J.R. Dick & Co., indorsees, brought this action against the maker. The pleas were nil debet and failure of consideration. At the trial the defendant produced R. telegram sent two days before to the plaintiffs at Meadville. directing them to bring to the trial books showing the state of the account with Phrenix IronWorks at and before the time of delivery and indorsement of the note of the Richmond Companyand to COmmencement of suit. "Do this to avoid delay." The telegram was signed by attorneys of plaintiffs and defendant. The books were not produced. Defendant then moved for a continuance until the evidence from the books could be produced. The motion was refused, and defendant excepted. The trial proceeding, defendant called S. B. Dick, who admitted that he was president of the Phrenix Company at the date of thelcontract, and the the no4Js were delivered and discounted. He denied any Il::nowledgeof any part of the transaction until this was brought. then offered to prove the contract made between it and one HenrY' Church, manager of the Phrenix Company, and in its behalf, and to.&l;l,l?w that the consideration for these notes given under this contract had failed. The court below withdrew frC?I)l. jury on It also refused to instruct the as S. B. Dick must jury, as requested, be presumed to have such notice of the defect in the notes as to destroy tb"eir negotiability in the hah'tls of his firm; that actual notice was not plaintiffs had opportunities necessarYi that it man on his guard." The defendant makes this refusal'of thElcourt the ground for his second and plaintiffs. Defendant moved for.-ane,w trial,which. :was refused.nHe makes .this the ground of his fourth and last exception. Wyndham R, Meredith, fo,r plaintiff in error. 'tegli R: Page; fbt -ih , Before BONl),:Circuit SIMON'l'ON, District Judge. " " ' . ,'. ".,J ."':' ..
District Judge..A,motion for continnance is addressed to the discretion of the court oelbw. . Its' action thereon is not reversible Woodsv. Young,4 Crahch,237t Sims v. Hundley, 6 How.!. In Banks'. Edition (jf the Supreme Court'Reports all {he cases are quoted ih a note to this case. The m'st ex?eption is overruled. Nor wiII this court entertain anexception because of the refusal of the court below to grant a llewtrial. This is wholly within its discretion. 3 Pet. v.Folsom, 18 Wall. 237; Co. v. Ftalo!"lOOU. S. 24; Cattle Co. v. Mann, 130 U. S. 75, 9Sup.Ct. ,Rep. 458; Ra.ilroad Co. v.Winte1', 143 U. S. 75,12 Sup. Ct. Rep. 356. The' fourth eX'eeption is overruled. '1'he second and third exceptions have been earnestly pressed. They will be considered together. The position taken is this: S. E. Dick, one of the plaintiffs, being president of the Phamix Company, had con-
RICHMOND RAILWAY & ELECTRIC CO. V. DICK.
381
structive notice of the consideration for which the notes were given, and of its failure; ,Notwithstanding that in fact he had no knowledge whatever of the transaction, still his position afforded him the means of knowledge. This affected him and his firm with such notice as to take away from them the protection afforded to bona fide holders of negotiable paper, and to subject them to the plea of failure of consideration. The record shows that the plaintiffs are holders of commercial paper. They are presumed, as such holders, to have taken it before maturity for value, and without notice of any objection to which it may be liable. This presumption stands until overcome by proof. Swift v. Tyson, 16 Pet. 1; Lexington v. Butler, 14 Wall. 282; Pana v. Bowler, 107 U. S. 541, 542,2 Sup. Ct. Rep. 704. There is no evidence whatever tending to show that the notes were not acquired before maturity, and for value. The sole contention is that defendant/had notice through S. B. Dick. He denies all actual knowledge of the and the sole inquiry is, did his position as president give him such notice, and put such means of knowledge in his power, us to defeat the title of his firm? The title of a holder of negotiable paper for value before maturity can only be defeated by showing bad faith in him which implies guilt)· knowledge or willful ignorance of the facts impairing the title. Hotchkis8 v. Bank, 21 Wall. 354; Murray v.Lardner, 2 Wall. 110. In thi.s case there is nothing in the' record which charges, and nothing in the :evidence which,.proves or tends to prove, fraud or bad faith 011 the part of the Phamix Company. The only thing charged is its failure to perform the'contract to the satisfa6tion of defendant,-anoccurrence of any day, an occurrence of every day, with honest cohtra9tors. Were we to assume that S. B,' Dick, as was affected with knowledge of all the transactions of the Phcenix COhlpany, nothing appears showing bad faith or k.nowledge. The most that can be said is that he knew thap,be noteE?were given for two imgihes. The last note was dated 15th July ,The first>Qomplaint was made 3d August. There is no testimony ,'showing that any of the notes were discounted after that'last date. be an alarming doctrine 'were it to be established that a bankdfscounting the businesR paper of a well-known customer tiJOk thepaper;8ubject to'any defense which the' niaker of the note could set up, that the goods for which the 'paper was gh-en were deficient in quantity or quality or both. "When a person," says the supreme court in Wilson v. WaU, 6 Wall. 91, "has not actual notice, he ought not to be treated as if he had notice, unless the circumstances are such as to enable the court to say, not only that he might ha\Te acquired, but also that he Ought to have acquired, it, but for his gross negligence in the conduct of the business in question. The question, then, when it is sought to affect a purchaser with constructive notice, is not whether means of obtaining, and might by prudent caution have obhe had tained,th¢ knowledge in question, but whether not obtaining it was an act of gross or culpable negligence." These exceptions are overruled, and the of the circuit court in every respect affirmed, with interest and'costs. '
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,Unde"rOode W. Va. c. ... S§38,39, asherlffwho refyses an order prop· arly issu'e'd:by tal! 'CO'l1l1ty'court, or, ih the a'liMiioe' 01 fu1'1ds; ,to indorse there'GIl, II P,1"fl$e01:4'ti for !,n,d sign ,the if: p",bljl, OIl b,isptllcial bOIld for' tile , r
In Err()rto tliedircuit Cot1rt,of the United fodheI>istrict of West Virglriiii." , ,'" , ' ; , " , .' ,,' A9titifl'byJW6 '.stl1te to the ,qse ,o{:iH,e, Society for ltrld:.hilfsureties bond Ilsshenff of cQu;nt'Y'i ':ftlry andl caus(llnbmltted on an of .' JUdgment '((if pldiritiff. Defendants bring
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, R. 'B,FJn81ow, for'defehdantiri error,' " ' ) , Before FU'd:,ER,'CircuitJ'listi'ce, , and GOFF, Circuit .Tudges: , . . . . '1' ,. ,""
'. ;BOND,.YircuitJ!ldge'J::U·appearsfrJni the agreed Btll:lenlent offacts ,case 'qourt ofW in the state of We'st Vlrginia, ont4e l,1tl,l,d'o/,of March; entered. an order on itsrec9,rds, which recited th,at rePort ofaspecialcommissioner J>Yft,precedipgcounty court,that there was indebtedilcrss by late county or Wayne, county in ac(Jorda.nce,withthEl of the rOll-ii laws of W then due and, unpa,lq,. It furtbe': 'recited that ,the leVie,S for tIle. then coming would, riot besunIqient to pay such indebtedIJ,ess, and pther expepsesfor like purposes;; 'It then directedbonds of the county' [or$12,OOO, )Vi,th 6 per cent., payable semiannually, to be and,that these bQDc(lS imd interest coupon!) should be a .charge upon the'road levies of the districts bfthe countyw:-herethe money from the sale: bonds was expended, fOf!!' termof 10 years, bonds were to. 00. the 11th day of August, 1882, thEl county court issued another order, similar to the above, 'except that the issue;of ,bonds to the value of defenderror, the Sooiety,for Savings, bought their face The coupty OPUrt .of Wayn'ecounty has paid the thereon ,,Il,p to September,,1889 1 .trnd Qne pond of $500. In paYJjDent of this inte,resUhe cQ]lntycourt ,i.'ssped orders sued On iIi thIS' case, and denotified the,'sheriff of Wayne the same for payment'tohim in qounty that 'itheld the. summer of 1889, again 4, 1890, and again on, May 16, pay' the same in obediellce to the order 1890. The sheriff refused
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