Dodge v. Freedman's Savings & Trust Co. - 93 U.S. 379 (1876)
U.S. Supreme Court
Dodge v. Freedman's Savings & Trust Co., 93 U.S. 379 (1876)
Dodge v. Freedman's Savings & Trust Company
93 U.S. 379
1. Declarations made by the holder of a promissory note or of a chattel, while he held it, are not admissible in evidence in a suit upon or in relation to it by a subsequent owner.
2. The declarations of a party when in possession of land are, as against those claiming under him, competent evidence to show the character of his possession and the title by which he held it, but not to sustain or destroy the record title.
3. In law, a person with whom a note is deposited for collection is the agent of the holder, and not of the maker. The maker has no interest in it except to pay the note. Failing to do this, he leaves it to be dealt with as others interested may choose.
4. Where a note, deposited in bank for collection by its owner, was paid by a person not a party thereto with the intention of having it remain as an existing security, and the money so paid was received by the owner of the note, held that such person thereby became the purchaser of the note, the negotiability of which remains after as before maturity, subject to the equities between the parties.
The Freedman's Savings and Trust Company, on the seventeenth day of May, 1873, exhibited its bill of complaint in the Supreme Court of the District of Columbia alleging that it owned and held certain unpaid and overdue promissory notes made by the defendant Dodge and that certain real estate in the City of Georgetown, which had been conveyed in trust to the defendants Jones and Darneille, to secure the payment of said notes, had been unlawfully and fraudulently released from the operation of the deed of trust and had been conveyed by defendant Dodge to the defendant Darneille, who had conveyed it to the defendant Dunlop in trust for the benefit of the wife of the defendant Darneille.
The bill prays for the cancellation of the release and also of the other conveyances, for a sale of all the property covered
by the original trust deed, for the application of the proceeds to the payment of the notes, for damages, if any should be found, against Jones and Darneille, for judgment against Dodge for any balance of said notes remaining unpaid, and for general relief.
The defendant Dodge answered admitting the making of the notes and of the deed of trust to secure them, but insisted that the notes had been paid and extinguished through an arrangement between him and William S. Huntington for the purchase of one of the pieces of property included in the trust, and that the complainant obtained the notes after they were due and had been paid.
The other defendants made no defense, and a decree pro confesso was taken against all of them.
The case was heard upon the pleadings and evidence, and the court at special term dismissed the bill. This decree was, on an appeal to the general term, reversed and a decree entered according to the prayer of the bill. The case is here on appeal by the defendants from that decree.
The defense rests entirely upon the allegation that the notes made by Dodge, in January, 1869, were paid in January, 1870.