In an action on four promissory notes, one of which was drawn by
the defendant in favor of the plaintiff and the others were drawn
by the defendant in favor of other persons who had endorsed them to
the plaintiff, parol evidence was properly admitted that the
defendant acknowledged that he was indebted to the plaintiff in the
amount of the notes and offered to confess judgment in the course
of a negotiation with the plaintiff's counsel, although the
negotiation fell through and although no proof was given of the
handwriting or signatures of the endorsers of the notes. This case
does not come within the reason or principle of the rule which
excludes offers to pay made by way of compromise upon a disputed
claim and to buy peace.
The court is not bound to give any hypothetical direction to the
jury and to leave them to find a fact where no evidence of such
fact is offered nor any evidence from which it can be inferred.
The admissions of a defendant that he is indebted to the
plaintiff on promissory notes, when proved by competent testimony,
are sufficient evidence of the transfer of negotiable paper,
without proof of the handwriting of the payer. Whether the evidence
was legally competent for that purpose or not is a question for the
court, and not for the jury, in the absence of all contradictory
testimony.
By the Act of the Legislature of Georgia of 15 December, 1810,
the assignment or endorsement of a promissory note is made
sufficient evidence thereof without the necessity of proving the
handwriting of the assignor. The Judiciary Act of 1789 declares
that the laws of the several states, except when the constitution,
treaties, or statutes of the United States require otherwise, are
to be rules of decision in the courts of the United States in
trials at common law where they apply. The Court does not perceive
any sufficient reason for construing this act of Congress so as to
exclude from its provisions those statutes of the several states
which prescribe rules of evidence in civil cases in trials at
common law.
The object of the law of Congress was to make the rules of
decision of the courts of the United States the same with those of
the states, taking care to preserve the rights of the United States
by the exceptions contained in the section of the Judiciary Act.
Justice to the citizens of the United States required this to be
done, and the natural import of the words used in the act of
Congress includes the laws in relation to evidence as well as the
laws in relation to property.
The Court refused to allow ten percentum per annum interest as
damages for suing out the writ of error in this case on the amount
of the judgment in the circuit court under the 17th rule of the
Court. The case was not considered as one where the writ of error
was sued out merely for delay.
In the Circuit Court of the United States for the District of
Georgia, Lowell Holbrook instituted an action on four promissory
notes, one
Page 37 U. S. 85
of which was drawn by the plaintiff in error in favor of Lowell
Holbrook, and the three other notes were drawn in favor of other
persons, who had endorsed the same over to Mr. Holbrook. An
affidavit of the agent of the plaintiff, stating that the
defendant, John McNiel, was indebted to Lowell Holbrook in the
amount of the said notes, was filed with the declaration. Issue
being joined in the suit, the plaintiff to support the action,
without having proved the handwriting of the drawer of the notes or
of those who had endorsed three of the notes to him, offered the
testimony of W. W. Gordon, Esq., the counsel of the plaintiff, to
prove
"that John McNiel had repeatedly, and as late as November 1,
1835, admitted his indebtedness upon those promissory notes, and at
the same time offered to confess a judgment for the amount of
principal and interest upon certain terms by which he was to be
allowed time for the payment of part. The negotiation continued
until November 3, 1836, and then was only not completed from the
inability of John McNiel to pay the cash, which he had in the first
instance offered."
The defendant objected to the admission of this evidence and
insisted that the acknowledgment was only an offer by the defendant
to buy his peace, by a compromise made in the course of a
negotiation, for the settlement of the claim of Mr. Lowell
Holbrook, which said compromise and negotiation having failed, the
acknowledgment could not be given in evidence to sustain the claim
of the plaintiff. The defendant also objected to the evidence, as
the plaintiff had declared against the defendant as endorser of
promissory notes alleged to have been made by certain persons to
him, he was bound to prove the endorsement of the notes by the said
persons, and the court could not dispense with the proof of the
endorsements. The court refused to give the instructions as asked
by the defendant and instructed the jury that the evidence offered
and admitted was sufficient to entitle the plaintiff to recover
against the defendant.
The jury having found a verdict for the plaintiff according to
the instructions of the court, and judgment having been entered
thereon, the defendant prosecuted this writ of error.
Page 37 U. S. 86
MR. CHIEF JUSTICE TANEY delivered the opinion of the Court.
This case comes up upon a writ of error directed to the Circuit
Court for the District of Georgia.
An action of assumpsit was brought in that court by Lowell
Holbrook against John McNiel to recover the amount of four
promissory notes made by the defendant, one of them payable to
Lowell Holbrook and three to other persons who had endorsed them to
the said Holbrook, who was the plaintiff in the court below.
The plaintiff declared on the promissory notes, and did not
insert in the declaration any of the usual money counts. The
defendant pleaded the general issue, and at the trial of the case,
the plaintiff offered to prove by a competent witness
"that John McNiel had repeatedly, and as late as the first of
November (the trial took place on the 11th of that month), admitted
his indebtedness upon these four promissory notes, and at that time
offered to confess a judgment for the amount of principal and
interest upon certain terms by which he was to be allowed time for
the payment of part. The negotiation continued until the third of
November, and was then only not completed from John McNiel's
inability to pay the cash, which he had in the first instance
offered."
The counsel for the defendant objected to the admissibility of
this evidence upon the ground that it was merely an offer on the
part of the defendant to buy his peace in the course of a
negotiation for the settlement of the claim of the plaintiff, which
had failed. The objection was overruled by the court and the
evidence given to the jury. The defendant excepted to this opinion
of the court.
The notes (which were endorsed in blank), together with the
evidence above stated, was the only testimony given in the cause.
The plaintiff offered no evidence to prove the handwriting of the
drawer or endorsers, and no evidence was offered by the
defendant.
The defendant thereupon moved the court to instruct the
jury:
1st. That the evidence given on the part of the plaintiff, was
not sufficient to entitle him to recover on the three notes, on
which he had declared as endorsee without proving the endorsements
of the payees mentioned in the said notes.
2d. That if the jury believed the acknowledgment above-mentioned
to have been made by the defendant in the course of a negotiation
with the plaintiff or his attorney for a compromise which had
failed, and for the purpose of buying his peace by such compromise;
that such acknowledgment was not sufficient of entitle the
plaintiff to recover on the three
Page 37 U. S. 87
notes, on which he sued as endorsee, without proving the
endorsement of the payees.
A third prayer was also made which is the same in substance with
the first. The court refused to give the instructions asked for by
the defendant and directed the jury that the evidence was
sufficient to entitle the plaintiff to recover. To these opinions
and to the instruction of the court the defendant excepted, and the
case has been brought here for the revision of this Court.
We think the circuit court was right in admitting the evidence
above stated. There does not appear to have been any dispute
between the parties as to the amount due on the notes, nor as to
the plaintiff's right to receive it. The negotiation as disclosed
in the testimony was altogether concerning the time of payment, and
not in relation to the amount to be paid, and the defendant, in the
course of that negotiation, admitted the debt and offered to
confess judgment for it in the suit then pending, provided time was
given to him for the payment of a part. This was the acknowledgment
of a fact by the defendant, and not an offer to buy his peace, and
we think the testimony was properly received, although the
admission was made pending a negotiation to enlarge the time of
payment. The case does not come within the reason or the principle
which excludes offers to pay, made by way of compromise upon a
disputed claim, and to buy peace.
We concur also, with the circuit court in the instructions given
to the jury after the testimony was admitted. The plaintiff was in
possession of the notes endorsed in blank. The admission of the
defendant of his liability for the amount, and his offer to confess
a judgment, was an admission of the plaintiff's right to the money
due on the notes, and consequently was an acknowledgment that he
was the maker of the notes and that they had been legally
transferred to the plaintiff. There could therefore be no necessity
for proving the endorsements, because that proof would have
established nothing more than what had already been proved by the
admissions of the defendant. For he could not have been indebted to
the plaintiff on these notes unless he was the maker of them and
unless they had also been legally transferred to the plaintiff.
This view of the subject disposes of the first and third
instructions asked for by the defendant.
As relates to the second prayer, the court would unquestionably
have been bound to give it if there had been any testimony from
which the jury could have inferred that the admission in
question
Page 37 U. S. 88
was made as an offer of compromise and to buy his peace. But we
see nothing in the evidence from which such an inference could have
been drawn. There does not appear to have been any negotiation
concerning the amount of the debt or the plaintiff's right to
receive it, and the court is not bound to give an hypothetical
direction to the jury and to leave it to them to find a fact where
no evidence of such fact is offered, nor any evidence from which it
can be inferred. Such being the case here, we think the court did
not err in refusing this direction.
The same reasoning applies to the direction which the court
gave. If there had been any evidence conducing to prove the fact
insisted on by the defendant, the jury was certainly the proper
judge of its sufficiency, and the court could not, without
encroaching on the province of the jury, have instructed it on that
point. But there was no contradictory testimony, nor any question
in relation to the credibility of the witness. The facts as stated
by him were not controverted, and in this state of the evidence the
counsel for the defendant, in his third prayer, moved the court to
instruct the jury that the acknowledgment so proved was not
sufficient to entitle the plaintiff to recover without proof of the
endorsements of the payees. The point thus presented to the circuit
court was upon the legal sufficiency of the evidence, the counsel
for the defendant insisting that notwithstanding the admissions of
the party that he owed the money on the notes and his offer to
confess a judgment to the plaintiff for the amount, yet the law
required the plaintiff to go further and to prove the endorsements
of the payees before he could entitle himself to recover. In other
words, the point was raised whether the admissions of a defendant,
when proved by competent testimony, are sufficient evidence of the
transfer of negotiable paper, without proof of the handwriting of
the payee. It is in answer to this prayer that the court instructed
the jury that the evidence was sufficient. The question submitted
to the court was a question of law, and turned upon the legal
sufficiency of evidence of a certain description to establish a
particular fact. And whether it was legally sufficient for that
purpose or not, or whether the law required higher or different
evidence was a question for the court, and not for the jury. The
point had in effect been decided by the opinion of the court on the
defendant's first prayer, and was properly and correctly
decided.
There is another ground upon which we think that the court
Page 37 U. S. 89
was right in refusing to instruct the jury, that it was
incumbent on the plaintiff to prove the endorsement on the notes
purporting to have been made by the payees. By an act of the
Legislature of Georgia passed on 15 December, 1810, Prince's Digest
of the Laws of Georgia 144, it is enacted
"That in all cases brought by any endorsee or endorsees,
assignee or assignees, on any bill, bond, or note before any court
of law or equity in this state, the assignment or endorsement,
without regard to the form thereof, shall be sufficient evidence of
the transfer thereof, and the said bond, bill, or note shall be
admitted as evidence without the necessity of proving the
handwriting of the assignor or assignors, endorser or endorsers,
any law, usage or custom to the contrary notwithstanding."
In a suit, therefore, in the state courts, there would have been
no necessity for proving the handwritings of the endorsers, and the
endorsements themselves would have been
prima facie
evidence that the notes in question had been transferred to the
plaintiff, he being in possession of the notes and the endorsements
of the payers appearing thereon in blank.
The 34th section of the Judiciary Act, establishing the courts
of the United States (1789, ch. 20) provides
"That the laws of the several states, except where the
Constitution, treaties, or statutes of the United States shall
otherwise require or provide, shall be regarded as rules of
decision in trials at common law in the courts of the United States
in cases where they apply."
We do not perceive any sufficient reason for so construing this
act of Congress as to exclude from its provisions those statutes of
the several states which prescribe rules of evidence, in civil
cases, in trials at common law. Indeed, it would be difficult to
make the laws of the state in relation to the rights of property
the rule of decision in the circuit courts without associating with
them the laws of the same state prescribing the rules of evidence
by which the rights of property must be decided. How could the
courts of the United States decide whether property had been
legally transferred unless they resorted to the laws of the state
to ascertain by what evidence the transfer must be established? In
some cases, the laws of the states require written evidence; in
others, it dispenses with it and permits the party to prove his
case by parol testimony, and what rule of evidence could the courts
of the United States adopt to decide a question of property but the
rule which the legislature of the state has prescribed? The object
of the law of Congress was to make the
Page 37 U. S. 90
rules of decisions in the courts of the United States the same
with those of the states, taking care to preserve the rights of the
United States by the exceptions contained in the same section.
Justice to the citizens of the several states required this to be
done, and the natural import of the words used in the act of
Congress includes the laws in relation to evidence as well as the
laws in relation to property. We think they are both embraced in
it, and as by a law of Georgia the endorsement on these notes was
made
prima facie evidence that they had been so endorsed
by the proper party, we think the circuit court was bound to regard
this law as a rule of evidence. It dispensed with the proof which
the defendant insisted on, and the circuit court on that ground was
right in refusing the prayers of the defendant, which required
proof of these endorsements. Upon the production of the notes the
plaintiff was entitled to recover without the aid of the parol
evidence, which is the subject of all the defendant's exceptions.
For this reason, independently of the principles hereinbefore
stated, we think the judgment of the circuit court below ought to
be
Affirmed.
The defendant in error has moved the court to allow him ten
percent damages, under the 17th rule of the Court, which provides
that when a writ of error shall appear to have been sued out merely
for delay, damages shall be awarded at the rate of ten percent per
annum on the amount of the judgment. We do not consider this case
as one of that description, and therefore award nothing more than
the ordinary interest of six percent
This cause came on to be heard on the transcript of the record
from the Circuit Court of the United States for the District of
Georgia and was argued by counsel, on consideration whereof it is
adjudged and ordered by this Court that the judgment of the said
circuit court in this cause be and the same is hereby affirmed with
costs and damages at the rate of six percentum per annum.
