Farris v. Catlett

Bates, Judge,

delivered the opinion of the court.

*470This is a suit on a negotiable note, made by the defendant to Nixon, and by him endorsed to the plaintiff.

The defendant answered that the note was, after maturity, assigned by Nixon, without consideration, to the plaintiff as collateral security for a precedent debt; that when the note was given it was part of the consideration of the purchase, by defendant from Nixon of a piece of land which was then encumbered by several deeds of trust, (which included also other lands) and that it was agreed between the defendant, said Nixon, and the parties to said deeds of trust, that the note should be turned over to one of the trustees in said deeds of trust, who should collect the same and pay the amount thereof upon the debts secured by said deeds of trust, in proportion to their several amounts ; and thereupon the land was to be released from the liens of said deeds of trust; of all which the plaintiff had full knowledge when he acquired said note; that the defendant has been compelled to buy said deeds of trust at a cost exceeding the amount of the note to prevent the sale of the land under the deeds of trust, and now credits the amount of said note on the debts secured by the deeds of trust; and the defendant further stated that the whole consideration of the purchase of the land has been paid except this note.

On motion, the answer was stricken out and judgment given for plaintiff,

The answer was improperly stricken out. It contained no defence at law, for the note was due and payable as therein specified, notwithstanding the collateral arrangement made at the time of execution. (Atwood v. Lewis, 6 Mo. 392; Bircher v. Payne, 7 Mo. 462.) In equity, however, the matter stated in the answer did constitute a defence, for the plaintiff, under the circumstances stated in the answer, stands in no better position than Nixon, the payee, himself; and if Nixon should require the payment to himself of the note, in violation of the agreement stated in the answer, it would be fraud upon the defendant.

Judgment reversed, and cause remanded, that the answer may be reinstated.

Judges Bay and Dryden concur.