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Ostrander o. Fay.


September, 1866. Where evidence of good faith in a chattel mortgage has been given, to

rebut the presumption of fraud arising from continued possession by the mortgagor, the finding of the jury thereon is conclusive. So held, where the mortgage was on a stock of merchandise, and required the mortgagor to take charge of and sell the goods, and apply the proceeds to the debt, by paying them over weekly to the mortgagee, and to follow the mortgagee's directions in the conduct of the business.

John Ostrander sued Lewis D. Fay, sheriff of Steuben, for conversion of the goods in a country store. Plaintiff claimed title under a chattel mortgage, given him by one Clayson, October 21, 1859, and duly filed. Defendant seized the goods on execution against Clayson, the mortgagor.

The mortgage contained stipnlations “ that the said Clayson shall take charge of the above mentioned stock of goods, and immediately proceed to open and carry on the business of merchandising at his own cost and expense in the store buildings before mentioned, and conduct and carry on the business in all respects, in a prudent, careful and merchant-like manner, subject, however, to the control, direction and general supervision of the said Ostrander, and apply the first proceeds and avails made from the sale of the said stock of goods, or any part thereof, to the payment of the said Ostrander's demand of $1,319.45, in manner following:

All the cash taken in to be paid over to the said Ostrander weekly, until the last mentioned sum is fully paid. . That the said Clayson is to follow the direction and advice of the said Ostrander in all matters connected with the said business, and not appropriate any of the money, or other means arising from the said business, until said Ostrander's demand is fully paid, without first consulting sail Ostrander and obtaining his permission to do so." On December 20, 1857, Ostrander, the plaintiff, took possession of the goods under the usual danger clause.

At the trial defendant claimed that the mortgage was fraudulent and void upon its face, as matter of law.

Ostrander o. Fay.

The judge ruled that the question of fraud was for the jury, and charged them, among other things, that the mortgage was presumptively fraudulent, as against the creditors of Clayson, and that it was for the plaintiff to satisfy the jury, by proof, that it was made in good faith; that if it was intended by the mortgagee to cover up the property of Clayson, or any part of it, so that his creditors could not get their pay, the mortgage was fraudulent, otherwise it was not; that the jury should look at the transaction, in relation to the accounts, and if they find that it was any part of the scheme in the first instance to allow Clayson to sell on credit, and use the accounts so made for his own benefit, it would avoid the mortgage as to his creditors; and the jury should find for defendant.

The jury found for plaintiff, and the court, at general term, affirmed the judgment entered on their verdict. Defendant appealed.

E. W. Chester, for defendant, appellant.
G. S. Jones, attorney for plaintiff, respondent.

BY THE COURT.-HUNT, J. [After stating above facts.] The charge was able and discriminating. It laid down the law correctly, and submitted the questions to the jury with plainness and fairness. The transaction was a questionable one, and a jury could appreciate it as well, and decide it as satisfactorily as the court. Under the cases of Ford v. Williams, 24 N. Y. 359; Same v. Same, 13 Id. 577, and Miller v. Lockwood, 32 1d. 293 (above), it would have been an usurpation of the functions of the jury, had the judge at the circuit assumed to decide the question of fraud, as a question of law. The same rule also is laid down in Gardner v. McEwen, 19 N. Y. 123, which is supposed by the appellant's counsel to sustain a different doctrine. Numerous requests to charge were submitted to the judge, which were refused, and various questions were raised upon the evidence offered. Upon a careful examination of them, I see point in which an error was committed by the judge.

Judgment should be affirmed.
All the judges concurred.
Judgment affirmed, with costs.

Page o. Morrel.


December, 1866.

One who makes, or indorses, and delivers negotiable paper, leaving the

date blank, authorizes any successive holder who takes it with such blank to fill up the blank; and the holder, by ante-dating it, so that it has less time to run than it would have had if dated as of the day it was made, does not discharge an indorser who delivered it with the blauk,

Ira and Orlando Page sued Daniel and Daniel H. Morrel, composing the firm of Morrel & Son, and Benjamin N. Nellis, in the supreme court, on a promissory note, of which D. Morrel & Son were makers, and Nellis the indorser.

The note was made on June 10, 1859, for the sum of fifty dollars, payable thirty days after date. It was dated June, but with a blank where the day of the month is usually stated, thus: “ June 1859.”

In this condition the note was indorsed by the defendant Nellis for the accommodation of the makers, and on the same day, the tenth, the makers transferred it for value to one Wiles. On the fifteenth of the month, Wiles transferred the note to the plaintiffs for value, and they, without the knowledge of any of the other parties thereto, and of course without their express consent, filled the blank in the date with the figure “1," so as to make the date “ June 1, 1859."

The indorser having been charged, on non-payment thirty days from June 1, this action was brought; and the only question was, whether the note was valid against the defendants, notwithstanding the insertion of the figure in the date. The judge found the foregoing facts, and held that the note was valid, and gave judgment for the plaintiff's.

The supreme court, on appeal, affirmed the judgment, holding that, although a note without date is valid, a note with a blank date is imperfect, and it is not an alteration for a holder to supply the imperfection. The part of the opinion of the supreme court (which was


Page o. Morrel.

rendered by BOCKES, J.) referred to in the opinion in this court, was as follows:

" It is insisted that the authority to fill the blank, resting in implication, is limited in the case of the indorser, to the makers, and in the case of the makers, to Wiles, to whom thay transferred the note, and was unlawfully exercised by the plaintiff, who received it in blank from Wiles.

“ While considering this point, it must be held in mind that there is no evidence that the blank was filled to effect any fraudulent design; and further, that it does not appear but that the blank was filled according to the the intent of the original parties.

“ The case of Crutchly v. Clarence, 2 Maule & Sel. 90, is in point. Here the question arose under a stamp act which required bills to contain the name of a payee. The bill was drawn and accepted in blank as to the payee. In this form or condition it was negotiated by one Vashon, who transferred it to the plaintiff, and the plaintif filled the blank. The action was against the drawer. Denman, for the defendant, took the objection that the plaintiff had no right so to do, and claimed the case was distinguishable from those where the bill was filled by one of the original parties. Lord ELLENBOROUGH answered, that the defendant, by leaving the blank, undertook to be answerable for it when filled up in the shape of a bill. BAYLEY, J., also remarked, that the issuing the bill in blank was an authority to a bona fide holder (that is, the bona fide holder of the paper in blank), to insert the name. In this case, like the case at bar, the blank was filled up by the plaintiff, who was the second transferee of the bill. The question was considered in Alwood v. Griffin, 2 Carr. & P. 370; 12 Eng. Com. Law, 622, where Crutchly v. Clarence was cited and approved. The same question was again considered in Schultz v. Astley, ? Bing. N. C. 545; 29 Eng. Com. Law, 655, and the point was pressed upon the court that the authority to fill the blank extended only to the party to whom the bill was given; but TINDALL, Ch. J., delivering the opinion of the court, said, no authority has been cited to us for any such restriction, nor can we see any in principle; and added, repeating the observatios of Lord MANSFIELD, in Russel v. Langstaff

, it does not lay

Page o. Morrel.

with the party sending forth the paper in blank to say that the filling up therecf is irregular. In Crutchly v. Mann, 5 Taunt. 528; 1 Eng. Com. Law, 272, the question arose under the stamp act, as in Crutchly v. Clarence, and, indeed, on the same bill, one action being against the maker and the other against the acceptor. The bill was drawn by Clarence on Mann, payable to the order of blank, and the plaintiff, to whom it had been transferred, inserted his own name as payee.

“It was insisted, that though there might be an authority to the payee himself to insert his name, yet there was no authority for the bearer of the bill to insert his name. HEATH, J., is reported to have held that there was an implied authority to the plaintiff; and the syllabus of the case is, that a bill made payable to the order of

-, may be filled up by any bearer with his own name who can show that he came regularly to the possession of it. So it is said in Edwards on Bills and Promissory Notes, p. 95, that when a blank is left, there is an implied authority to the holder to fill up the instrument and make it in fact what it was designed to be. In the Commonwealth Bank v. McCord, 4 Dana, 191, it was held that when a party intending to enter into an obligation signs the paper in blank, there is an implied authority to any holder to

. . “So it was said in the Mechanics' & Farmers' Bank v. Schuyler, 7 Cow. 337, if the time of payment be left blank, it may be filled at the pleasure of the holder. In Story on Bills of Ex. 8 222, it is stated thus: Indorsements are sometimes made upon bills containing blanks to be afterwards filled up, and some

blank paper, which are intended to be filled up so as to make the party an indorser. In all such cases, as against him, the bill is to be treated exactly as if it had been filled up before he indorsed it, and he will be bound accordingly. And it will make no difference in the rights of the holder that he knows the facts, unless, indeed, there should be a known fraud upon the indorser, or a known misappropriation of the bill to other purposes than those which were intended.

“So, in Mitchell v. Culver, the plaintiff knew the fact that a date other than the true one was inserted. SUTHERLAND, J., remarked: "I do not perceive that this can vary the casc.'

fill it up

times upon

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