Opinion
Decided June, 1888.
A recovery by the indorser of a promissory note of the amount due on it as damages in an action against the indorsee for fraud in obtaining the indorsement, perfects the title of the indorsee to the note.
ASSUMPSIT, on a promissory note signed by H. D. Bermethan, payable to the order of Alice L. Prescott, and by her and the other defendants indorsed to the plaintiff.
Marston Eastman, for the plaintiff.
A. F. L. Norris and C. P. Sanborn, for the defendants.
The defendants purchased of the plaintiff certain mining stock upon his representation that its market value was one dollar and twenty-five cents a share, and in part payment transferred to him the note in suit. The stock was worthless. Upon the ascertainment of this fact by the defendants they immediately returned the stock to the plaintiff, and unsuccessfully demanded the return of the note. Whereupon they brought suit against him for deceit in the sale of this and other stock of the same company, and recovered judgment therein for the amount then due on the note as part of the damages, which judgment the plaintiff paid. The consequent effect was to perfect his ownership of the note, and to estop the defendants from interposing the deceit as a defence to the present suit for its collection. In other words, the matter of deceit having been adjudicated and the defendants compensated therefor, their liability to the plaintiff upon the note is now the same as it would be had the market value of the stock been as represented. See Parsons v. Crawford, 64 N.H. 23.
Exception overruled.
ALLEN, J., did not sit: the others concurred.