Clinton v. Royal, 203 Ill. App. 248 (1917)

Jan. 17, 1917 · Illinois Appellate Court · Gen. No. 21,474

203 Ill. App. 248

G. E. Clinton, Defendant in Error, v. Rhoda Royal, Plaintiff in Error.

Gen. No. 21,474.

(Not to be reported in full.)

Error to the Municipal Court of Chicago; the Hon. Hugh J. Kearns, Judge, presiding. Heard in the Branch Appellate Court at the October term, 1915.

Reversed and remanded.

Opinion filed January 17, 1917.

Rehearing denied January 29, 1917.

Statement of the Case.

Action by G-. E. Clinton, plaintiff, against Rhoda Royal, defendant, on two judgment notes for $2.50 each, drawn by defendant and made payable to one Seaver, and by him indorsed in blank. From a judgment against him on a directed verdict, defendant brings error.

The notes in question were judgment notes signed by the defendant, and on the back of each appeared the following order:

“Chicago, Ill. March 14th, 1914.

6 < cni'PPT*

Young Buffalo Wild West Co.

“Please pay to the order of Vernon C. Seaver Two Hundred and Fifty ($250.00) Dollars, and charge same to my 1913 account.' . .. . ....

Rhoda Royal.”

The date and the amount named in those orders were identical with the date and the amount named in the promissory notes.

The defendant testified that the Young Buffalo Wild West Company owed him $1,700 for services during, the year 1913; that he considered Seaver as the owner of the show; that he had done all his business with him; that at the time the notes were made, Seaver gave him $500 on account, and expressly agreed to look to the show for reimbursement, and that defendant would not have to pay the notes; that he (Beaver) would get the $500 from the show; that the defendant was about to attach the show for the amount due him, and that Beaver advanced the $500 with the tacit understanding that the attachment would not be made, and that it was not made, and that he credited the account of the show with the $500 which he had received. All of this testimony was stricken out. Counsel for defendant also made the following offer:

Abstract of the Decision.

1. Bills and notes, § 251 ^* —when purchaser after maturity without consideration is charged with notice of defenses pleadable against payee. A purchaser of judgment notes after maturity and without consideration is charged with notice of any defenses plead-able against the payee, unless title is procured from a person standing in the position of a bona fide purchaser without notice.

2. Bills and notes, § 18 ^* —lohen designation of particular account to be debited with amount of judgment notes does not render them conditional. Under the Negotiable Instruments Law, sec. 3 (J. & A. If 7642), notations on the backs of judgment notes designating a particular fund to be debited with the amounts of the notes do not render the notes conditional.

“Tour Honor, I want to show the schedules filed and sworn to on behalf of the Wild West Company, a corporation in bankruptcy, that they scheduled their indebtedness to this defendant at $1,200, showing the payment less the $500 which appears upon these notes.”

This offer was objected to, and the evidence excluded as immaterial.

Adolph Marks, for plaintiff in error.

Wheelock, Newey & Mackenzie, for defendant in error.

* See Illinois Notes Digest, Vola. XI to XV, and Cumulative Quarterly, same topic and section number.

* Seo Illinois Notes Digest, Vols. XI to XV, and Cumulative Quarterly, same topic and section number.

Mr. Justice Goodwin

delivered the opinion of the court.

3. Bills and notes, § 431 ^* —when parol evidence is inadmissible. Evidence as to a conversation had at the time notes are executed is inadmissible for the purpose of varying the terms of the notes themselves, or for the purpose of showing an agreement that defendant would not be liable according to their terms.

4. Bills and notes, § 426 ^* —when bankruptcy schedules are erroneously excluded in action on judgment notes. In an action on two judgment notes given by an employee of a circus to the manager thereof, on the backs of which were notations directing the treasurer of the company to pay to the manager the amounts thereof and charge to the maker’s account, and there was evidence that the manager had expressly agreed to look to the circus for reimbursement and that defendant would not have to pay the note, held that schedules filed in bankruptcy by the circus company showing that the indebtedness to the defendant had been reduced by the amount of such notes were admissible in evidence, especially in view of the fact that the payee had the entire control and management of all the affairs of the bankrupt company.