Dissenting Opinion.
Dausman, J.I cannot concur in the majority opinion in this cause, and I feel that it is my duty to state briefly the reasons why I dissent.
The averment in the complaint, which has engendered the controversy, is in the following words:
“That said Federal Loan Society, Inc., for value received in due course of business and before its maturity, to-wit: on September 1, 1915; assigned in writing and transferred said note to plaintiff.”
As used in §51 of the Negotiable Instruments Act, the words “a holder in due course” have a definite meaning. That meaning is clear' and unequivocal, and can*533not be varied except by future legislation. Even a casual reading of the averment above quoted should be sufficient to enable one to see that it is not equivalent to an averment that the plaintiff took the instrument under the conditions specified in said §51. The averment that the payee transferred the note to the plaintiff “in due course of business” is nothing more nor less than a conclusion. Bunting v. Mick (1892), 5 Ind. App. 289, 31 N. E. 378, 1055; Watson’s Prac. §357. If the pleader had averred that the plaintiff is “a holder in due course,” even then it would be the averment of a conclusion, although a very different one. Instead of averring all the facts necessary to show that appellee is a holder in due course, he has averred the constituent element that the plaintiff acquired the note before maturity, and has deliberately omitted the elements of good faith and want of notice of any infirmity. It is conceded that the facts averred in the answer constitute fraud. We have a case, then, wherein the court is depriving a defendant of a substantial right because he has not denied something which is not averred in the complaint. If appellant had averred in the answer that appellee had notice, that averment would have been mere surplusage. Boxell v. Bright Nat. Bank (1916), 184 Ind. 631, 112 N. E. 3.
I am aware of the fact that there is a recent case directly in conflict with this view. Millikan v. Security Trust Co. (1918), 187 Ind. 307, 118 N. E. 568. Also an older one to the same effect. Hall v. Allen (1871), 37 Ind. 541. I cannot refrain from saying that these cases should not be regarded ruling precedents as against the explicit provisions of the Negotiable Instruments Act, the long-established rules of pleading, and the numerous well-considered cases bearing on this subject. Tescher v. Merea (1889), 118 Ind. 586, 21 N. E. 316; Giberson v. Jolley (1889), 120 Ind. 301, 22 N. E. *534306; First Nat. Bank v. Ruhl (1890), 122 Ind. 279, 23 N. E. 766; Ray v. Baker (1905), 165 Ind. 74, 74 N. E. 619; Union Trust Co. v. Adams (1913), 54 Ind. App. 166, 101 N. E. 741. I do not want to be regarded as rigidly and harshly technical. But the matter is important. The Negotiable Instruments Act is new in this state, and questions arising out of that law should be decided right, to the end that confusion in future litigation involving the statute may be minimized.
There is a broader question to be considered. In cases like the one at bar, what is the effect of embodying in the complaint' an averment of the facts which constitute the-plaintiff a holder in due course? It is the theory of the law merchant that, in order to facilitate trade and commerce, negotiable instruments should circulate, as nearly as possible, as currency. Such instruments carry no presumptive burdens. All presumptions are in favor of the holder. §59 Negotiable Instruments Act; 3 R. C. L. 1037 et seq. .Why, then, should the plaintiff take upon himself, by the averments of his complaint, the burden of proving facts which would show him to be a holder in due course? Such averments in a complaint can serve no purpose other than to indicate that the pleader is anticipating a defense, and that, as a general rule, is bad pleading. Watson’s Prac. §416. I do not mean to say that the inclusion of anticipatory matter would necessarily make the complaint bad as against a demurrer. Nevertheless it is bad pleading because it is illogical and leads to confusion. The logical, natural and orderly way is to reserve such matter for the reply.
But if, in this class of cases, the plaintiff avers in his complaint facts sufficient to avoid a defense of fraud, the averment is mere surplusage. This must be true; for he cannot be required to prove the facts thus averred as against the general denial. The general denial puts *535at issue only the material averments of the complaint, and at that stage of the proceeding the averment is wholly immaterial. Miller v. Griswold (1872), 40 Ind. 209; Tescher v. Merea, supra; 3 R. C. L. 1033 et seq. Any denial which the defendant might embody in an answer could not have the effect of compelling the plaintiff to prove the facts necessary to show that he is a holder in due course. It is the answer of fraud, and that answer alone, that puts him to the proof. Naturally, then, the facts which will avoid a defense of fraud should be averred in the reply and not in the complaint; for those facts do not become material until an answer of fraud has been filed.
It has been said that, although it is not commendable pleading to embody in the complaint averments for the sole purpose of avoiding a possible defense, nevertheless it is permissible on the theory that it deprives the defendant of no right which otherwise would be his. Johnson v. Harrison (1912), 177 Ind. 240, 97 N. E. 930, 39 L. R. A. (N. S.) 1207. The cases cited on that proposition lend little, if any, support. What is said on the subject in the first two is purely obiter. The third does not touch the point at all. In the fourth a correct result is reached concerning the sufficiency of the complaint, but the reasoning, is clearly wrong. But, if such averments are to be regarde'd as material, then that kind of pleading is bound to be harmful. It baffles the defendant in his effort properly to present his defense. It tends to confuse the courts, to promote litigation, and to work injustice. In the case at bar a majority of the court is holding that the effect of it is to put on a defendant the duty to embody iñ his affirmative answer a denial of the superfluous averments of the complaint. A denial has no place in such an answer. An answer of fraud in such cases should consist of clear and positive averments of such facts as would *536coñstitute a defense against the payee. Then it becomes incumbent on the endorsee to show that he is not'bound by that defense.
Of course, the parties by their conduct may waive the rules of pleading. But where a litigant stands on his rights in respect thereto, he is entitled to the protection of the courts.
A rehearing should have been granted, and the judgment reversed.