delivered thé opinion of the court:
The judgment to be reviewed was obtained by the plaintiff in' the county court, on appeal from a justice of the peace. The plaintiff .brought the. action for an amount alleged to be due him on account of threshing grain for the defendant. Only two of the assignments of error need be noticed. The defendant claimed that at the time the plaintiff bought the threshing machine from the Case Company, the plaintiff, in a written order for -the machiner)', contracted to give notes for a part of the purchase price, and to secure the same by a mortgage upon the machinery and earnings thereof, and stipulated further that,if the notes and mortgage were not given, then the *387•written .order should stand as the purchaser’s written obligation, having the same force and effect as ;a mortgage. After-wards, notes were given with a mortgage, securing, the same, upon the machinery only. The defendant paid $42.66 to the Case Company at its solicitation. He.attempted to offset the amount so paid against the plaintiff’s claim, asserting- it was paid to a mortgagee, and the court refused to let him do so.
The defendant claims, that inasmuch as the mortgage given did not cover the earnings, the order under the contract became a mortgage upon the earnings. So that when he paid earnings to the Case Company, he paid it to a mortgagee entitled thereto. This contention cannot be sustained. The order given was not a mortgage,, but was a contract for a mortgage to cover ■ the machinery, and earnings. Now this contract could be easily abrogated or changed by the mutual assent of the parties, and when one gave and the other accepted notes and a mortgage upon the machinery only, it amounted to a mutual agreement that the contract was sufficiently carried out, or, in other words, that a mortgage on the earnings was eliminated. As a matter of fact, the $42.66 was the. consideration paid, by the defendant for the two notes hereafter mentioned, as he claims. He can not be heard to» say, for one purpose, that it was a mortgagee’s money, and for another, that it was his own.
The defendant, as an offset, also introduced in evidence two notes from the plaintiff to the Case Company, upon which there was a balance due of $132.00. The notes were negotiable and were endorsed without recourse by the. payee. They were obtained by the defendant before the commencement of the action, but whether before maturity is not clear. The plaintiff had abandoned his threshing- business and had gone away, and the record shows that his property was taken from him and sold under mortgage by the Case Company. The defendant, at the solicitation of the company, paid several of the men, who- had been working for the plaintiff, the balance due them for wages and took assignments from the *388men aggregating $51.80. The court correctly allowed these assigned claims. It was upon the promise of the company to protect him, “if Stokes turned up,” that the defendant paid the $42.66 and the amount to the men. Later, the defendant hearing that “Stokes was going to turn up,” went to the officer of the company and obtained the two notes, paying one dollar at the time. He testified that the notes were his absolute property. The court refused to allow the defendant to counterclaim on the notes. The court substantially found the facts as above narrated and there is no apparent dispute about them, but drew therefrom the inference that by the transfer of the notes the company sought to avoid any liability which it might be under to- Stokes, and that, therefore, the transfer of the notes was not a bona fide transaction. The court did not connect' the defendant with this inferred desire of the company. On the contrary, it found that he was straightforward in the matter. He had paid the money to the men and the company under its promise that it would protect him. Under the apprehension that he needed that protection, he called upon the compan}'-. At that time, when the financial condition of the maker is considered, the notes cannot be said to have been worth the amount of money that he had given to the company without regard to what he had paid to the men. About the only value they had was in the hands of the defendant as an offset to any claim which the defendant might make against him. Under these circumstances, the notes were taken, endorsed without recourse, and, - so far as appears on this record, the matter was a closed incident -between the company and the defendant. It had carried out its agreement to protect him against any. claim of the plaintiff, and the notes were, as he said, his absolute property. He was the bona fide holder of them for value. The court erred when it refused to regard him as such 011 account of some ulterior motive of the company. There was no claim of any infirmity in the notes. The record seems to indicate that the plaintiff attempted to show that equities existed between him and the *389company while the notes were in the latter’s hands, which would cancel the notes or reduce the amount due on them. Those equities could not be considered as to- the note or notes transferred to- the defendant before maturity. The court failed to find when either of the. notes.' was transferred, or what amount was due on them. It did find that the plaintiff’s claim against defendant, after allowing the offset of the wages paid to the men, was with interest, $90.10, and as there is no dispute about it, that finding is affirmed.
The judgment, however, is reversed and the cause remanded with instructions to try the question of the amount due on the two notes at the date of its, former judgment, May 3, 1911, in accordance with the views herein expressed, and to offset the amount found due, if any, against the $90.10 found as the amoúnt of plaintiff’s claim, and enter judgment as of said date in favor of plaintiff or defendant as the facts found may warrant.
Reversed and Remanded.
Chief Justice Campell and Mr. Justice Garrigues concur.