Real Estate Investment Co. v. Russel

Citations

• 148 Pa. 496
• 24 A. 59
• 1892 Pa. LEXIS 1009

Syllabus

<p>Promissory note — PaudA-Bona fide holder — Burden of proof — Affidavit of defence.</p> <p>The general rule in regard to commercial paper is that the plaintiff is presumed to be a bona fide holder, and that the burden is upon the defendant or maker of the note to show that he is not.</p> <p>It is equally well settled, however, that when the defendant has shown that the note was obtained or put into circulation by fraud or undue means, the maker may require proof of consideration.</p> <p>An affidavit of defence to a suit on a promissory note, alleging that the note was put into circulation by fraud, is sufficient to prevent judgment. The plaintiff will then be required to show that he took the note before maturity and paid value for it. Were this not the rule, it would be impossible for the maker of a note fraudulently issued to set up any defence whatever, since plaintiff’s connection with the note would, as a general rule, be a matter as to which he could have no knowledge.</p> <p>Partnership — Firm note for a partner’s individual debt — F-aud.</p> <p>It is a fraud for one partner to use the name of the firm for his own individual transactions. An averment that a firm note was given for such a purpose by one of the partners is in effect an averment that the note was fraudulently issued.</p>