223

SUPREME COURT OF THE UNITED STATES.

an equitable character, and he might have used the name of Hugh Short, in order to recover at law. That his indorsement of the certificate was no more than a mere authority to receive the money, and did not subject him to the pay ment of the sum mentioned in the certificate in case of default by the bank. Story on Prom. Notes, secs. 128, 129.

Messrs. Chase and Rockwell:

The first exception only remains for consideration, namely: that the paper declared on is not a negotiable promissory note under the laws of Ohio.

There is nothing peculiar in the legislation of The Ohio in relation to promissory notes. statute "making certain instruments of writing negotiable," provides that "all promissory notes drawn for any sum or sums of money certain, 224*] and made payable to any person or order, or to any person or bearer, or to any person or assigns, shall be negotiable by indorsement thereon," etc. Swan's Stat. This legis. lation does not at all affect the general principles so firmly established by repeated decisions in respect to negotiable paper.

"A bill or note is not confined to any set form of words. A promise to deliver or to be accountable, or to be responsible for so much money, is a good bill or note." 3 Kent's Com. 75; Chitty on Bills, 40, and notes.

"No particular words are necessary; the form may be varied at the pleasure of the individual, so, always, that it amounts to a written promise for the payment of money absolutely ind at all events, and interferes with no statute regulation. Thus: an order or promise to deliver a certain sum of money to A, or to be accountable or responsible to A, for a certain sum of money, or that A shall receive it from the maker, is a good promissory note; so a receipt for money to be returned when called for, or an acknowledgment, due to A a certain sum of money payable on demand; or a promise to pay or cause to be paid to A a certain sum of money; or an instrument acknowledging the receipt of money of A, promising to pay it on demand with interest; or acknowledging the receipt of money to be repaid in one month; or acknowledging to have borrowed a certain sum of money, in promise of payment thereof." Story on Prom. Notes, 15, sec. 12.

A promise implied by law, founded upon a mere acknowledged indebtment, will not be sufficient. Thus, where A wrote upon a slip of paper "I O U eight guineas," it was held to be a mere due-bill, and not a promissory note. But if the promise were "Due to A B, £20, payable to him or order," it would be a promissory note, for it contains more than the law would imply, and becomes negotiable. Story on Prom. Notes, 17, sec. 14; Curtis v. Rickards, 1 Mann. & Grang. 46; Russell v. Whipple, 2 Cowen, 536.

The decisions in Ohio are in strict accordance with these principles.

In Moore v. Gano, 12 Ohio R. 302, the following instrument was held a promissory note:

20th

1836

In McCoy v. Gilmore, 7 it was held that “no specia necessary to constitute It is enough if the intent the sum can be made certa

a

In Ring v. Foster, 6 Oh by which A agreed to pay and forty dollars, "provid crop of tobacco raised by hi to have one fourth of the a and in addition three do weight for that part yet to b one fourth in hand, and the dred and twenty days," was issory note.

These cases show the doct subject; and that it is quite of commerce as that of E states.

The plaintiff in error relie of a decision said to have Supreme Court of Ohio in The case is not reported, bu supposed to have been decide an authorized reporter, in a but as an item of intelligence Those conversant with the the Supreme Court on the would not claim the weigh this paragraph in the Law

There is, however, it mu decision, not of an Ohio cour vania court, both respecta which sustains the doctrine plaintiff in error.

In the v. Poindexter, 6 Watts & Ser that a certain certificate of spects like that now in cont negotiable note. The opinion tains three propositions:

1st. That the words "pay not import a promise to pay opposition to the whole curr American authority.

2d. That a promise to pay certificate," is a contingen promise, and therefore then promise is made is not a pr this, although the court is forced to admit that "true it tingency is no more than is promissory note."

3d. That the words "paya from 18th May, 1839, with terest till due," constitutes a for interest, which is inco character of a promissory ne rect opposition to t

thority.

Upon these three propositi ed their conclusion that the was not a negotiable promis

The only authority cited conclusion was Horne v. R Cases, 267.

*This was a decision u Stamp Act. Suit was brough

letter:

185.

Ohio, Pt. 1, 268,
al form of words is
- promissory note.
appear, and [223
in by calculation."
io, 279, a contract
to B one hundred
ed B delivers the
n and C, then B is
bove sum in hand,
lars per hundred
e delivered, payable
balance in one hun
held to be a prom-
ine in Ohio on this
as liberal in favor
gland, or her co

= upon a brief note
been made by the
Hamilton County.
merely the point
d; and this not by
y book of reports,
for a law journal
tirrup practice of
Circuit in Ohio,
of authority for
ournal.

t be admitted, a
but of a Pennsyl
e and respected,
nsisted on by the
ase of Patterson
227, it was held
eposit, in all re
oversy, was not
of the court mais

1851

MILLER V. AUSTEN ET AL.

It was stamped as a special agreement, and
was sued on as such. It was objected that it
was a promissory note, and not being stamped
as such, could not be given in evidence.
Chief Justice Tindal said: "I think this case
But
may be decided by referring to the provisions
of the Stamp Act, without referring to the cases
which have been cited." He then proceeded to
hold that the instrument, being stamped as a
special agreement, and not as a promissory note,
fell within the exemption of the Act, 55 Geo. III.
ch. 184, from the promissory note stamp "of all
other instruments bearing in any degree the
form or style of promissory notes, but which
shall in law be deemed special agreements, ex-
cept those hereby expressly directed to be
deemed promissory notes." The Chief Justice
added, "It would be a very harsh construction
of the Act to hold the document to be a promis-
sory note, after the commissioners on stamps
have impressed it with an agreement stamp,
upon payment of the usual penalty."

This brief statement clearly shows that the
case of Horne v. Redfearn went entirely upon
a construction of the Stamp Act; and it is re-
markable enough, that by this very Act, sim-
ple certificates of deposit, issued by banks,
without any words, such as "payable," and
the like, importing a promise to pay, are de-
clared to be promissory notes.
cannot be a doubt that in England the paper
So that there
now in controversy would be held to be a prom-
issory note, whether the question was decided
upon general principles or statutory provisions.
The Pennsylvania decision. then, is with-
out the support of any English case, as it is
without the support of any general principle
of law applicable to promissory notes.

We shall proceed to show that it is in direct
conflict with American authorities.

In the case of Kilgore v. Bulkley, 14 Conn. 363, the Supreme Court of Connecticut held the following certificate of deposit to be a promissory note:

$10,608.75.

Chelsea Bank, July 6, 1839.
I do hereby certify that David E. Wheeler,
Robert S. Taylor, and Noah Bulkley, have de-
posited in this bank the sum of ten thousand
six hundred and eight dollars seventy-five
cents, payable on the first day of December
next, to their order, on the return of this cer-
tificate.
D. E. Wheeler, President.

ble to order" do
which is in direct
t of English and
On "return of the
and conditional
ce by which such
missory note; and
mediately after,
= that such a con
implied in every
e twelve months
Sve per cent. in
special agreement
sistent with the
P: and this, also,
e current of au-
is the court rest-
aper in question
ory note.
support of this
fearn, 6 Scott's

der the [226
on the following
mber 25, 1829.
um of £20, which
untable

227*] *And the following writing, indorsed
upon the paper, was held to be an indorsement
by which the parties made themselves liable as
indorsers of a negotiable note:

"For value received, we hereby assign to 8.
F. Maccracken, Joseph S. Lake and Daniel
Kilgore, Commissioners of the Ohio Canal
Fund, or their successors, the amount of the
within certificate."

The case of The Bank of Orleans v. Merril, 2 Hill, N. Y. 295, is also in direct conflict with the case of Patterson v. Poindexter. In that case the action being brought on a certificate of deposit, the court said, "the instrument in question is in effect a negotiable promissory

note."

Thus, then, stands the case

The

226

sential to a promissory note. It is a promise to pay a sum of money certain, at a fixed time, for value received. as a negotiable promissory note. By the maker, maker, by the defendant, and by the plaintiffs, It was regarded by the for it was in the language of the Ŏhio statute, "drawn payable to order;" by the defendant, for he issued it payable to the order of his indorsee, and he added to his signature the place of his residence, obviously that, in the event of non-payment, it might be known where to direct notice; by the plaintiffs, for they caused it to be presented for payment, and protested as negotiable paper. of distinguished ability, have expressly held Two American courts, similar instruments to be negotiable paper. One American court has held otherwise.

We do not think it worth while to comment on This statement would seem to be decisive. the positions of the counsel for the plaintiffs in error, that the paper in question is not a promof the return of the certificate; and that, if it issory note, because subject to the condition is a note at all, it is a note to Hugh Short, and not to Henry Miller. The first is refuted by the remark of the court which suggested it, that it is a condition which is implied by law in every promissory note; and the section is refuted by the language of the instrument, and the act of the defendant himself.

illustrate somewhat strikingly the disposition We will only add two or three cases, which to which the Supreme Court of New York referred, when they said, "the great commercial advantages growing out of negotiable instruments, have induced the courts to adopt a most liberal rule in construing them." & Marsh. 590 (41 Eng. Com. Law, 321). The first case is that of Walker v. Roberts, 1 Carr. sory note: following document was held to be a promis

The

lent to James Roberts £19, 19s. 11d.; to pay
"February, 1831. William Walker [*228
five per cent. for the same £19, 19s. 11d.; to
pay on demand to the said William Walker,
same.
giving James Roberts six months' notice of the
James Roberts, Mary Roberts.

3 Hill's N. Y. 132. The action was upon the
The other case is that of Henschel v. Mahler,
following instrument:

December, 1839. On the 31st of October, of
"For francs 8,755.CO, payable on the 31st of
this year, pay to the order of ourselves, 8,755
of December, of this year."
francs 60 centimes, payable in Paris, the 31st

change, notwithstanding the ambiguity: the
It was held a valuable negotiable bill of ex-
being rejected as repugnant, and the bill held
words "on the 31st of October, in this year"
payable "on the 31st of December."

2 Cow. 536; 10 Wend. 675; and, in deciding We refer the court, also, to 1 Greenl. 535; instrument is a promissory note within the the last of which cases, Nelson, J., said, "the statute, as it contains every quality essential to such paper. debtedness on its face implies a promise to The acknowledgment of inpay the plaintiffs," and the payment, by its terms, was to be in money, absolutely. The instrument on which this last action was bess

SUPREME COURT OF THE UNITED STATES.

ALANSON SALTMARSH, Plaintiff in Error, script of the record from the

In a suit by the indorsee against the indorser of a bill, where the defense was usury, the drawer and drawee were incompetent witnesses, when offered to prove certain facts, which, when taken in conJunction with certain other facts, to be proved by other witnesses, would invalidate the instrument. Being Incompetent witnesses to establish the CYRIL C. TYLER and his whole defense, they are also incompetent to establish a part.

ered the opinion of ill, dated at Mobile, for four thousand 1. It was indorsed and by him to d Saltmarsh. The general issue, and sury. By the law ny security [*230 , who takes more E per cent. per an ced, is prohibited st. and can have ginal sum loaned

matter in controHill, the drawer, the drawees, were e defendant; and as incompetent, on negotiable paper ame, gave it ered terwards, upon his he instrument, by tion on which it he witnesses were e offered to prove nnection with adproved by others. ment in part, by -roof was offered. =h the defense of It must be the bill had been hole defense, then old, that he could hout which piece efense could be sion of the rule, s from giving ev -ation. ented to us, nor record, worthy of the judgment of

ense.

Where a person desired to purchase land from a party who was ignorant that he had any title to It, or where the land was situated; and the pur: 231] chaser made fraudulent representations as to the quantity and quality of the land, and also, as to a lien which he professed to have for taxes which he had paid; and finally bought the land for a grossly inadequate price, the sale will be set aside.

Thus the United States for the District of
HIS was an appeal from the Circuit Court

Maine, sitting as a court of equity.

The facts are all stated in the opinion of the court.

It was argued by Mr. Fessenden for the appellants, and Mr. Rowe for the appellee. The points made by the counsel for the appellants were the following, viz.:

The complainants claim to have their deed to Black, dated November 30, 1846, canceled, and a reconveyance of said estate, on the following grounds:

1. For fraud and fraududent representations.
2. For inadequacy of price, as, of itself, fur-
nishing evidence of fraud.

3. For the two preceding grounds united.
General Considerations.
larations of Black, to show he had formed a
The acts and dec-
design to commit frauds in making this pur-
chase, as opportunity should offer.

All such acts and declarations of Black made
to other persons, about the time of the transac-
tion, are competent evidence for complainants,
for that purpose. Bradley v. Chase, 22 Maine
Rep. 511; Warner v. Daniels, 1 Wood. & M.
90; Wood v. The United States, 16 Pet. 342;
S. C. 14 Pet. 430.

Complainants rely on the testimony of the Vermont witnesses, viz.: Edward F. Putnam, Albert G. Soule, E. P. Soule, and Phebe Hendricks, to prove such acts and declarations of Black.

First Proposition. The bill, answer, and evidence, establish complainants' proposition of fraud, on the part of Black, in several particulars, either of which is sufficient to entitle them to a decree in their favor.

1. As to complainants' title and the evidence of it, and Black's misrepresentations concerning it.

2. Black's misrepresentations as to the number of acres.

3. Black's misrepresentations as to incumbrances on the land, and particularly of his lien thereon for taxes, alleged to have been paid by himself.

4. Black's misrepresentations of the value of the land.

(Each one of these points was examined ac
cording to the evidence.)

Second Proposition. The doctrine is well
stated in Story's Commentaries on Equity Jur.
secs. 245 and 246.
After stating the general
proposition that mere inadequacy is not a suf-
ficient ground for relief, he says (sec. 246):
232*]"Still, however, there may be such
unconscionableness or inadequacy in a bargain,
as to demonstrate some gross imposition, or
undue influence; and in such cases, courts of
equity ought to interfere upon the satisfactory
ground of fraud. But then, such unconscion-
ableness or such inadequacy, should be made
out as would, to use an expressive phrase,
14 L. ed.

230

conclusive and decisive evidence of fraud. And
where there are other ingredients in the case
shock the conscience, and amount, in itself, to
tween the parties, gross inadequacy of price
of a suspicious nature, or peculiar relation be-
must necessarily furnish the most vehement
presumption of fraud."

1 Ch. 2, sec. 9, note e.
The same doctrine is stated in Fonb. Eq., B.

"Where the deed is executed, if the parties
been any concealment, or misrepresentation, or
have not been on equal footing, or, if there has
such deed or contract.'
imposition, courts of equity uniformly set aside
ed. p. 317, and note 2.
Sug. Vend. 6th Amer.
"Where the circumstances of the case are
from the situation or condition of the parties,
such as have afforded an opportunity, either
to take a fraudulent advantage of the other,
or the nature of the property, for either of them
this court considers that circumstance to be
and the consideration is grossly inadequate,
| evidence of fraud, and will not only refuse a
specific performance at the instance of the for-
mer, but will, at the suit of the latter, rescind
the transaction." Jer. Eq. Jur. 483, and notes.

consideration, from one not conusant of his
"A conveyance, obtained for an inadequate
will be set aside, although no actual fraud or
right, by a person who has notice of such right,
imposition be used." Sug. Vend. 6th Amer.
ed. 320.

eral proposition, to define what is to be un-
"Although it may be impossible, by any gen-
derstood by gross inadequacy of consideration,
the circumstances of each individual case in
as it must, in a great measure, depend upon
which the question may arise; yet, if it be so
gross and palpable, as of itself to afford evi-
dence of actual fraud, the court will set aside
Franklin, 2 Johns. Ch. 1, and cases cited.
a sale." Jer. Eq. Jur. 433, note 7; Osgood v.

which was a case where the vendors were ig
In Turner v. Harvey, 1 Jacob's Ch. R. 169,
norant of a fact or circumstance considerably
word, a single word, be dropped which tends to
increasing the value, the court says: "If a
mislead the vendor, the principle that the pur-
mation as to the value of the property, will not
chaser is not bound to give the vendor infor-
be allowed to operate."

"Mere inadequacy, of itself, is not enough to
Again: in Hill on Trustees, 152, it is said,
set aside a contract; but where the inadequacy
man of common sense, without pro- [*233
is so gross that it is impossible to state it to a
it, the court will infer, from that fact alone,
ducing an exclamation as to the inequality of
oppression in the transaction, as to amount to
that there must have been such imposition, or
a case of fraud, from which it would not suffer
any bene^t or advantage to be derived. Other
circumstanes of fraud will aid the court."

To apply these principles to the case at bar.
as of itself to afford evidence of fraud.
The inadequacy of price, in this case, is such
1799 Parsons conveyed to Putnam for 50 cents
an acre.
In
an acre.
Black pa Tyler and wife 8 cents

from 50 cents to $2 per acre, November 30,
Black. in his answer, says that it was worth
1846. Now, 50 cents to $2 averages $1.25

233

SUPREME COURT OF THE UNITED STATES.

acre; so that Black purchased for 84 cents an acre what he admits was worth $1.25 an acre. He bought for $50 what he admits was worth $757.50.

Third Proposition. The bill may be sustained on the ground of fraud and fraudulent representation, and for inadequacy of price, united.

On these principles the court will find a rule for their guidance in Seymour v. Delancey, 6 Johns. Ch. R. 222. Chancellor Kent, in that case, found it convenient to take the average value, as established by the witnesses on the one side and the other.

On this principle the land was worth about $4.45 an acre, or $2,688.36, in November, 1840, date of deed of Tyler and wife to Black. The denials of the answer are thus overcome, and the bill is maintained.

The counsel for the defendant in error made the following points, viz.:

The court has no jurisdiction. The value of the matter in controversy is one of the points at issue in the case. The proofs fail to show the land to be worth $2,000. It is not worth over 50 cents per acre, as shown by respondent's witnesses.

1

Black offered to commu a reasonable compensation made at the commenceme tion, and repeated afterwa was no concealment.

Before the execution of plainants were informed o to the defendant, in relati their title thereto.

It is too late for compl vantage of any concealme gotiations, they having exe all the facts were fully d on Frauds, 106, cites Flee Ves. 594; Burroughs v. Oal 1 Sugd. Vend. 392, secs. 27, 1 Story's Eq. Jur. sec. 203, Point 4. There was no mi The testimony of E. F. as to the representations ma field, is irrelevant and ina terrogatories, which called i to. If admissible, it is dis dent bias and strong feeling by their mutual contradic to Black's denial of knowl quantity of land, and his sta to the number of acres, the the place searched for pa their statement that Black s dead, which contradicts the bill and answer.

(The arguments upon this point upon both sides depend so entirely upon references to the testimony, that they cannot be reported.) Point 2. There was no inadequacy of price. The inadequacy, to be evidence of fraud, must be so gross as to shock the conscience. Story's Eq. Jur. secs. 244, 245, 246; 1 Sugd. Vend. [*422, 423,] 318, 319, and cases there cited. Here is no satisfactory proof of such inadequacy as would even amount to damage. 1 Story's Eq. Jur. sec. 203. The consideration, on Black's part, was the $100 paid, the amount due for taxes and interest, and his claim for 234*] trouble and expenses, in discovering *and notifying the heirs. There is no sufficient proof now (as before shown) that all which Black takes by his deed is worth more than that. This charge is not made th At the time of the contract it was doubtful ticular interrogatory, but is how much he would take by his deed, or wheth-rogatories 7 and 16; and is er he would take anything.

It was not then fully ascertained whether Dr. Putnam died seised of any portion of this lot; and it was not known of how much, if any. It was not even known that Parsons had sold him any land, or if any, how much. The extent of Mrs. Tyler's rights, as heir at law, was not clearly ascertained. The value of the land was unknown. Defendant had no information but that derived from Mrs. Sheldon, and Tilden, and from the Putnams.

Black did not represent title, or a lien on the land. consistent in its several pa plainants' proof. The clain was the claim which the ans had, an equitable one 01 the land, and not a legal cha self. He made no represe number of acres.

swer.

Black stated that he "d many acres belonged to said he could not have known. the number of acres, if made ter of opinion, so understo and there is no evidence tha

A misrepresentation must more than a mere matter of Eq. Jur. 179; Hepburn v. 179.

The representation, if m terial. The land in itself is ly value is the timber. The gives no idea of the quantit the timber there were no rep and no inquiries. It was no

Where neither of the parties knows the value of the estate, no inadequacy of consideration can operate, even to prevent a decree for specific performance in favor of the purchaser. Anon. cited in 1 Bro. C. C. 158, and 6 Ves. Jr. 24; 1 Sugd. Vend. [*441, 442] 318. Point 3. There was no fraudulent conceal- sale. The bill contains no ment.

was an inducement (see p. ( A purchaser is under no obligation to give its truth; no interrogatory in any information, unless there be some relation averment that the complaina of confidence between the parties. 2 Kent's was not regarded as evidenc Com. 5th ed. 490, by Lord Thurlow, in Fox v. the land sold by either part Macreth, 2 Bro. C. C. 420; Laidlaw v. Organ, | wards inquired again as to