United Shoe Machinery Co. v. Winston , 1914 Pa. Super. LEXIS 344 ( 1914 )

Opinion by

Head, J.,

The copy of the plaintiff’s statement that was served on defendant contained a notice to the latter “to file a plea and an affidavit of defense within fifteen days” or judgment, etc. Within the time and at the same time both plea and affidavit were filed. A rule was then entered for judgment for want of a sufficient affidavit. The rule was made absolute and this appeal followed.

In Dreifus v. Logan Steel Co., 245 Pa. 196, President Judge Willson pointed out the scope and effect of Rule 42, of the revised rules of the common pleas courts of Philadelphia county, and held that, under the operation of that rule, a plaintiff had not waived or lost his right to a summary judgment because his statement carried such a notice which was followed by the filing of a plea. The Supreme Court adopted that opinion and affirmed the judgment. In Stevens, etc., Co. v. Armstrong, 245 Pa. 552, the same court, following the case cited, affirmed a like judgment. The practice in Philadelphia county is therefore settled and the first position of appellant is untenable.

The plaintiff sues on a check of which he became the holder by indorsement from the payee. The defendant is the maker. The important averment in the statement is this: “That the said John A. Jackson, to whose order said check was drawn, for value received, duly indorsed the same to the plaintiff.” The first clause of sec. 59 of the Act of May 16, 1901, P. L. 194, declares, “Every holder is deemed, prima facie, to be a holder in due course.” When the plaintiff therefore had properly averred his title to the check as a holder, by indorsement from the payee, the statute itself declared, without further averment by him, that, for the purpose of making a prima facie case, he was a “holder in due course.” His averment then was no more than an affirmation of the legal presumption incident to the status of any holder of a negotiable instrument.

The defendant was then compelled to answer this prima facie case. His affidavit sufficiently avers a state of facts which, if established, would show that the payee in negotiating the check as he did, had perpetrated a rank fraud on the maker. This being so the statute in turn comes to the aid of the maker. The second clause of the same section already quoted from provides: “but when it is shown that the title of any person who has negotiated the instrument was defective, the burden is on the holder to prove that he ... . acquired the title as holder in due course.”

The affidavit being regarded as verity, the defendant has shown a defective title in the person who negotiated the check in suit. The plaintiff must now proceed and proceed by proof to establish as a fact what before was but a presumption of fact, to wit, that he became a holder in due course. His obligation to do so is not conditioned on any averment or proof by the defendant that plaintiff took the instrument with notice of the defect in the title of the person who negotiated it. Manifestly it is but rarely the defendant could have such knowledge of a transaction to which he was no party, as to enable him to aver upon his oath or prove by evidence that plaintiff took the paper with notice of the defect. He would thus be denied the benefit of the statutory provision we have quoted.

But we need not depend on our own reasoning to support the conclusion indicated. In Second Nat. Bank of Pittsburg v. Hoffman, 229 Pa. 429, one McKee made a note and fraudulently procured the indorsement of Hoffman thereon. He then negotiated the note to the bank. The bank, holder, sued the indorser. The latter defended on the ground that McKee, who negotiated the note, had defrauded him in obtaining his indorsement. He made no effort to prove the bank took the note with any notice of the fraud. In the opinion, Mr. Justice Brown used this significant language: “The defendant was not required, in the first instance, to show that the bank had knowledge of the false representations made by McKee to him, for after he had shown, as he clearly did show, that a fraud had been practiced upon him, the bank was called upon to show affirmatively that it had no notice of the fraud when it took the note in good faith and for value:” It ought to be clear enough that what a defendant is not required to prove to make out a case, he need not aver in his affidavit of defense. We must therefore conclude the affidavit in the case at bar was sufficient to entitle the defendant to a trial by jury and the learned court below fell into error in entering a summary judgment against him.

Judgment reversed and a procedendo awarded.