Catasauqua National Bank v. Miller , 1915 Pa. Super. LEXIS 172 ( 1915 )

Opinion by

Head, J.,

The defendant, having been induced by certain false representations, to which later reference will be made concluded to buy certain shares of stock in a corporation known as “Corporation Funding and Finance Company.” In payment of the purchase-price of said shares he executed and delivered to the corporation his promissory negotiable note in the sum of $1,000. This was in 1911. The note in due course and before maturity was endorsed by the payee corporation, and at its instance and for its benefit was discounted by the plaintiff bank. When it was about to mature, notice was given by the bank to the defendant maker. A partial payment was made and a new note given to the original payee for the balance, and this transaction was repeated on several occasions until on May 29,1912, the defendant executed and delivered to the Corporation Funding and Finance Company the final note in the series, to wit, a note for $750. This note, like those preceding it, was turned over by the corporation to the plaintiff bank with a check for the discount and lifted the next preceding one in the series.

Whilst this last referred to note was maturing, the Corporation Funding and Finance. Company became financially involved, and, upon the appointment of a receiver and an investigation of its business, was found to be insolvent. The defendant then refused to pay his note at maturity on the ground that it had been obi1 tained without any consideration and by the use of false and fraudulent representations by those interested in selling to him the stock. On the trial he offered evidence which would warrant a finding that he had been so deceived and defrauded by those to whom he delivered the note, but he offered no scrap of evidence tending to show that the plaintiff bank, when it purchased or discounted the paper, had any knowledge whatever of any infirmity in the title of the then holder. Notwithstanding the absence of any proof of this char-, acter, the terms of the Negotiable Instrument Act required the plaintiff bank to affirmatively prove that it took the note for value in due course and before maturity without any knowledge of any infirmity in the title of the payee. This burden of proof the bank proceeded to discharge by offering the testimony of its cashier and of several of the members of its finance committee. They all united in declaring that no notice or knowledge of any fraud or deception inducing the original execution of the note had ever come to the bank or any of its officers at or before the time when the note was discounted. There was not a scintilla of evidence to controvert this testimony. Corroboration of it was found in the statement of the defendant himself that even he had no knowledgé whatever of the fraud until long after the time the note had been negotiated, and after he had renewed it several times and made partial payments on account of it. Under this state of facts we think the learned trial judge would have been warranted in directing a verdict for the plaintiff, and having declined so to do, he thereafter properly entered a judgment for the plaintiff notwithstanding the verdict.

As the case now stands it is not distinguishable from National Bank of Coatesville v. Palmer, 56 Pa. Superior Ct. 82. Although the question upon which that case actually turned was not precisely the same as that now urged upon us, yet its reasoning we cannot disregard. The second case of Bank v. Hoffman, 233 Pa. 390, seems to be exactly in point, and the present chief justice in the opinion in that case clearly points out why there was properly a directed verdict for the plaintiff, although in the first appeal such direction was held to be erroneous.

The verdict of a jury on a submitted question of fact must be responsive to some evidence introduced or must rest upon a proper inference to be drawn from a failure to overcome some presumption recognized by the law-Here the bank had fully discharged the burden of proof imposed upon it by the statute. It offered the testimony of several witnesses and there was not a scintilla of evidence in contradiction of what they affirmed. Their testimony, as was said in Lonzer v. Lehigh Valley R. R. Co., 196 Pa. 610, “was not in itself improbable, was not at variance with any proved or admitted facts, or with ordinary experience, and comes from witnesses whose candor there is no apparent ground for doubting.” In such cases it was declared the jury is not at liberty to indulge in a capricious belief. If they do so, it is the duty of the court to set the verdict aside. In Keiser v. Lehigh Valley R. R. Co., 212 Pa. 409, the court, affirming the doctrine of the case just previously cited, further said: “Under these circumstances the learned court below was justified in refusing to submit the question to the jury and in saying that the plaintiff had failed to establish the negligence complained of.”

The great fabric of commercial business in this country rests largely upon the proposition, long recognized and everywhere accepted, that a negotiable note is “a courier without luggage,” and that innocent holders for value, who take such paper in due course of business, are not to be bound or affected by any secret equities between the maker of such paper and the payee named. The statute imposes no unfair or unnecessary burden on such holders when it declares that under certain circumstances they must affirmatively prove they have had no knowledge of any'infirmity in the title of the person who negotiated the instrument. But when they have discharged that burden by competent and abundant testimony of apparently reliable witnesses, and there is not even a scintilla of evidence to the contrary, it surely must be the law that a jury cannot arbitrarily and capriciously render a verdict against the whole of. the evidence submitted, Where a court would be obliged to set aside such a verdict because it rested on no foundation in the evidence, and the whole of the testimony of one party is corroborated by that of the adverse party, it may with propriety direct the action of the jury. We conclude therefore the learned judge below was right in entering a judgment for the plaintiff and the assignments of error are consequently overruled.

Judgment affirmed.