it up.385 In like manner, the burden of proving failure of consideration is upon the defendant.38

In like manner, the burden of proof is on the defendant alleging that the consideration of a bill or note was illegal; 387 e. g. that the note was usurious; 388 or was given for liquor sold without a license; 389 or for the sale of a lottery prize. 390 But the presumption of a valid consideration must be met by proof, and mere denial by averment in the answer is, in general, not sufficient to rebut the presumption.391 Nor is such presumption, in the case of an indorsement, rebutted by mere proof of the want of a proper

385 Byles, Bills, 122; Chit. Bills, 80; Story, Prom. Notes, § 181; Smith v. Martin, 9 Mees. & W. 304; Bingham v. Stanley, 2 Q. B. 117; Mills v. Barber, 1 Mees. & W. 425; Fearn v. Filica, 7 Man. & G. 513; Robins v. Maidstone, 4 Q. B. 815; Percival v. Frampton, 2 Cromp., M. & R. 180; 3 Dowl. 748; Whittaker v. Edmunds, 1 Moody & R. 366, 1 Adol. & E. 638; Collins v. Martin, 1 Bos. & P. 651; James v. Chalmers, 6 N. Y. 209; Sawyer v. Vaughan, 25 Me. 337; Fitch v. Redding, 4 Sandf. (N. Y.) 130; Trustees of Iowa College v. Hill, 12 Iowa, 462; Henderson v. Girandeau, 15 La. Ann. 382; Nevins v. Chapman, Id. 353: Hardy v. Ross, 4 Ill. App. 501; Martin v. Tucker, 35 Ark. 279. So, that an indorsement was intended merely to transfer title. Allin v. Williams, 97 Cal. 403, 32 Pac. 441.

386 Stephens v. Lanier, 20 La. Ann. 347; Muggah v. Tucker, 10 La. Ann. 683; Green v. Casey, 70 Ala. 417; McKenzie v. Improvement Co., 5 Wash. 409, 31 Pac. 748; Herman v. Gunter, 83 Tex. 66, 18 S. W. 428; Bisbee v. Torinus, 26 Minn. 165, 12 N. W. 168; Conmey v. Macfarlane, 97 Pa. St. 361; or a partial failure, Bisbee v. Torinus, supra.

387 Edmunds v. Groves, 2 Mees. & W. 642; Wyatt v. Bulmer, 2 Esp. 338; Wyman v. Fiske, 3 Allen (Mass.) 238; Emery v. Estes, 31 Me. 155; Pixley v. Boynton, 79 Ill. 351; Pryor v. Coulter, 1 Bailey (S. C.) 517; Powell v. Graves, 14 La. Ann. 873; Brown v. Kinsey, 81 N. C. 245; Hone v. Ammons, 14 Ill. 29. So, that a corporation note was given for private accommodation. Martin v. Manufacturing Co., 44 Hun, 130. That a note for "futures" is for a gaming consideration will not be presumed. Williams v. Connor, 14 S. C. 621. It is a question for a jury whether a note was given for a wager or not. Craig v. Andrews, 7 Iowa, 17.

388 Hudson v. Mortgage Co., 100 Ga. 83, 26 S. E. 75; Waterman v. Baldwin, 68 Iowa, 255, 26 N. W. 435; White v. Benjamin, 138 N. Y. 623, 33 N. E. 1037. 389 Doe v. Burnham, 31 N. H. 426. Both facts must be proved, viz. that the note was given for spirituous liquor and that the liquor was sold without license.

390 Terry v. Olcott, 4 Conn. 442.

391 Greer v. George, 8 Ark. 131; Trustees of Orphan School v. Fleming, 10 Bush (Ky.) 234; Gutwillig v. Stumes, 47 Wis. 428. In Vermont, however,

revenue stamp at the time of its delivery; 392 or of the absence of the payee from a trial in court, the note having been given for his services as attorney in the case. In some states, by force of statute, the denial of a valid consideration by plea or answer puts the consideration in issue, and throws on the plaintiff the burden. of proving it.394

393

Burden as to Holder for Value.

§ 567. On the other hand, where want or failure of consideration is proved, this does not, in general, throw the burden on the plaintiff of showing himself to be a holder for value without notice. 395 But it was formerly held that, where a note was shown to have been given for accommodation, this burden fell upon the holder.396 In the words of Lord Abinger in Mills v. Barber: "There is a substantial distinction between bills given for accommodation only, and cases of fraud, inasmuch as in the former case it is to be presumed that money has been obtained upon the bill. If a man comes into court without any suspicion of fraud, but only as the holder of an accommodation bill, it may fairly be presumed that he is a holder for value. The proof of its being an accommodation is no evidence of a want of consideration in the holder." It is therefore to be considered as the rule now established that the general issue puts in issue the consideration as well as the execution, and it is incumbent on the plaintiff in such a case to prove the consideration. Goodenough v. Huff, 53 Vt. 482.

392 Long v. Spencer, 78 Pa. St. 303.

393 Douglass v. Eason, 36 Ala. 687.

894 Gen. St. Mass. c. 129, § 17; Davis v. Travis, 98 Mass. 222; Estabrook v. Boyle, 1 Allen (Mass.) 412; Martin v. Donovan, 15 La. Ann. 41.

395 Gray v. Bank, 29 Pa. St. 365; Albrecht v. Strimpler, 7 Pa. St. 476; Dingman v. Amsink, 77 Pa. St. 114; Knight v. Pugh, 4 Watts & S. (Pa.) 445; Brown v. Street, 6 Watts & S. (Pa.) 221; Wilson v. Lazier, 11 Grat. (Va.) 478. So, too, Whittaker v. Edmunds, 1 Moody & R. 366, modifying Heath v. Sansom, 2 Barn. & Adol. 291. But many cases hold that the burden falls on the plaintiff of proving himself in such case a holder for value. Rogers v. Morton, 12 Wend. (Mass.) 484; Small v. Clewley, 62 Me. 155; Delano v. Bartlett, 6 Cush. (Mass.) 364; Thompson v. Armstrong, 7 Ala. 256; Zook v. Simonson, 72 Ind. 83; Harbison v. Bank, 28 Ind. 133.

396 Byles, Bills, 122; Black River Savings Bank v. Edwards, 10 Gray (Mass.)

387.

mere evidence that a bill or note was given for accommodation
will not throw upon the plaintiff the burden of proving himself
to be a holder for value.397 Where the accommodation is itself
a fraud on a partnership or corporate maker, the proof amounts
to evidence of fraud, and shifts the burden accordingly.

On the other hand, it is held that evidence that an indorser
signed a note merely as guarantor throws on the plaintiff the bur-
den of proving himself a holder for value.398 And so does evi-
dence that the bill or note in question was stolen from the de-
fendant, or was lost by him; 399 although it has been doubted
whether this rule would apply to a bank bill stolen from the bank
before it was put into circulation.1oo In like manner, evidence
that the maker was sick and intoxicated at the time of making the
note throws on the holder the burden of proving that he paid value
for it.401 This is true, also, where the consideration is proved by
the defendant to be illegal.402 So, where it is shown that the note
was given in renewal of a note given originally for an illegal sale
of liquor.403 So, where a note is proved to have originated in
fraud, the burden falls on the plaintiff of proving himself to be

397 Byles, Bills, 122; Mills v. Barber, 1 Mees. & W. 425; Percival v. Framp-
ton, 2 Cromp., M. & R. 180; 3 Dowl. 748; Whittaker v. Edmunds, 1 Moody
& R. 366, 1 Adol. & E. 638; Clark v. Holmes, 2 Fost. & F. 75; Jacob v. Hun-
gate, 1 Moody & R. 445. And this has been held to be the rule notwithstand-
ing plaintiff's admission of the fact on the record. Edmonds v. Groves, 2
Mees. & W. 642; Smith v. Martin, 9 Mees. & W. 304; Fearn v. Filica, 7 Man.
& G. 513. But see, contra, Bingham v. Stanley, 2 Q. B. 117; Robins v. Maid-
stone, 4 Q. B. 815.

398 Sandford v. Norton, 14 Vt. 228.

399 Worcester County Bank v. Dorchester & Milton Bank, 10 Cush. (Mass.)
488; Matthews v. Poythress, 4 Ga. 287; Merchants' & Planters' Nat. Bank v.
Trustees of Masonic Hall, 62 Ga. 271; Devlin v. Clark, 31 Mo. 22.

400 Metcalf, J., in Worcester County Bank v. Dorchester & Milton Bank,
supra.

401 Holland v. Barnes, 53 Ala. 83.

402 Wyat V. Campbell, Mood. & M. 80; Bailey v. Bidwell, 13 Mees. & W. 73;
Sistermans v. Field, 9 Gray (Mass.) 331; Tucker v. Morrill, 1 Allen (Mass.) 528;
Smith v. Edgeworth, 3 Allen (Mass.) 233; National Bank v. Kirby, 108 Mass.
497; Emerson v. Burns, 114 Mass. 348; Paton v. Coit, 5 Mich. 505; Wing v.
Ford, 89 Me. 140, 35 Atl. 1023; Cottle v. Cleaves, 70 Me. 256; or where it is
admitted to be illegal, Bingham v. Stanley, 1 Gale & D. 237, 2 Q. B. 117. But
see Hill v. Northrup, 4 Thomp. & C. (N. Y.) 120, 1 Hun (N. Y.) 612.

403 Holden v. Cosgrove, 12 Gray (Mass.) 216.

a holder for value.404 So, too, where the note, though originally
valid, has been obtained and negotiated by fraud; 405 or fraudu-
lently transferred by an agent; 406 or fraudulently diverted by the
payee.407 And this has also been held to be the case where there
is no consideration for the note; 408 or where the consideration of
a note given for goods purchased fails through a subsequent fraud-
ulent conversion of the goods by the payee.*

409

The further consideration of the burden of proof of notice or
want of notice, as affecting the bona fide character of the holder,
is left for a subsequent part of this work.410

404 Chit. Bills, 725; Duncan v. Scott, 1 Camp. 100; Paterson v. Hardacre, 4
Taunt. 114; Rees v. Marquis of Headfort, 2 Camp. 574; Thomas v. Newton, 2
Car. & P. 606; Harvey v. Towers, 6 Exch. 656; Holme v. Karsper, 5 Bin.
(Pa.) 469; Hart v. Potter, 4 Duer (N. Y.) 458; New York & V. S. S. Bank v.
Gibson, 5 Duer (N. Y.) 574; Maples v. Browne, 48 Pa. St. 458; Munroe v. Cooper,
5 Pick. (Mass.) 412; Marston v. Forward, 5 Ala. 347; Bertrand v. Barkman,
13 Ark. 150; Wallace v. Bank, 1 Ala. 349; Smith v. Braine, 16 Q. B. 244;
Tatam v. Haslar, 23 Q. B. Div. 345; McClintick v. Cummins, 2 McLean, 98,
Fed. Cas. No. 8,698; Jordan v. Grover, 99 Cal. 194, 33 Pac. 889; Harrington v.
Johnson, 7 Colo. App. 483, 44 Pac. 368; Zook v. Simonson, 72 Ind. 85; Mitchell
v. Tomlinson, 91 Ind. 167; Eichelberger v. Bank, 103 Ind. 401, 3 N. E. 127;
Skinner v. Raynor, 95 Iowa, 536, 64 N. W. 601; Brook v. Teague, 52 Kan.
119, 34 Pac. 347; Crampton v. Perkins, 65 Md. 22, 3 Atl. 300; Haines v. Trust
Co., 56 N. J. Law, 312, 28 Atl. 796; Vosburgh v. Diefendorf, 119 N. Y. 357, 23 N.
E. 801; Douai v. Lutjens, 21 App. Div. 254, 47 N. Y. Supp. 659; Owens v. Snell,
Heitshu & Woodard Co., 29 Or. 483, 44 Pac. 827; Real-Estate Inv. Co. v. Rus-
sel, 148 Pa. St. 496, 24 Atl. 59; Wright v. Hardie, 88 Tex. 653, 32 S. W. 885;
Fuller v. Green, 64 Wis. 159, 24 N. W. 907; Williams v. Huntington, 68 Md.
590, 13 Atl. 336; Rhinehart v. Schall, 69 Md. 355, 16 Atl. 126.

405 Ross v. Bedell, 5 Duer (N. Y.) 462; Hale v. Shannon, 57 Hun, 466, 11 N.
Y. Supp. 129.

400 McLemore v. Cannan, 9 La. Ann. 22; Hazard v. Spencer, 17 R. I. 561, 23
Atl. 729. So, where it is delivered in violation of an escrow. Landauer v.
Sioux Falls Imp. Co. (S. D.) 72 N. W. 467. And see § 447, supra.

407 Sperry v. Spaulding, 45 Cal. 544; Mundy v. Pritchard, 22 Misc. Rep. 22,
47 N. Y. Supp. 1073.

408 Perley v. Perley, 144 Mass. 104, 10 N. E. 726; Mossop v. His Creditors,
41 La. Ann. 296, 6 South. 134.

409 Hutchinson v. Boggs, 28 Pa. St. 294. But see, contra, as to failure of
consideration by nonperformance of the payee's agreement for use of pro-
ceeds of the note, Lamb v. Burke, 132 Pa. St. 413, 20 Atl. 685; and as to fail-
ure in general, Knight v. Pugh, 4 Watts & S. (Pa.) 445; Kelman v. Calhoun,
43 Neb. 157, 61 N. W. 615; Crosby v. Ritchey, 47 Neb. 924, 66 N. W. 1005.
410 See § 1024 et seq., infra.

[END OF VOL. 1.]

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