
    McKEE v. DISTRICT NATIONAL BANK.
    Bills and Notes; Affidavits of Defense; Corporations.
    In an action by the holder of a promissory note, a bank, against the maker and indorser, an affidavit of defense by the maker, to the effect that the plaintiff is not tho legal owner and holder of the note, is insufficient to prevent a summary judgment against him, where it appears that the note was payable to a corporation; that it was first indorsed by the corporation, and then by an individual, and then indorsed for deposit to the credit of the corporation, which last indorsement was signed by the corporation by its president, and was followed by a guaranty of payment and a waiver of protest, demand, and notice, signed by the corporation and its president. (Citing secs. 1334 and 1341, D. C. Code [31 Stat. at L. 1399, 1400, chap. 854.]
    No. 2374.
    Submitted March 4, 1912.
    Decided April 1, 1912.
    Hearing on an appeal by one of several defendants from a judgment of the Supreme Court of the District of Columbia, under tho I3d rule of that court, for want of a sufficient affidavit of defense in an action on a promissory note.
    
      Affirmed.
    
    The Court in the opinion stated the facts as follows:
    This is an appeal from a summary judgment entered in accordance with the 13d common-law rule of the supreme court of the District of Columbia.
    The declaration of the District National Bank alleges that on January 2, 1910, the defendant Thomas H. McKee executed a promissory note whereby he promised to pay, on demand, to the order of Samuel H. Moore Company, the sum of $1,190, with interest at the rate of 6 per cent per annum until paid. Said note was delivered to said Samuel H. Moore Company, and afterwards, and before maturity, said Samuel H. Moore Company and Samuel H. Moore indorsed and delivered the same to the plaintiff, who thereby became the legal owner and holder thereof. That demand has been made of the defendant for payment, which he has failed to make. That said note has been regularly protested for nonpayment. The declaration concludes with the ordinary common counts. Samuel PL Moore Company and Samuel H. Moore are also made defendants.
    The note filed as “particulars of demand” reads as described in the declaration.
    Indorsements on the back of the note show first the signatures of Samuel PL Moore Company and Samuel PL Moore; second made by means of a rubber stamp), “Por deposit to the credit of the Samuel H. Moore Co., per Samuel PL Moore, President.” Third (made by means of rubber stamp), “Por value received — hereby guarantee the payment of the within note and any renewal of the same, and 'hereby waive protest, demand, and notice of nonpayment thereof.” This is followed by the signatures of Samuel PL Moore Company and Samuel PL Moore.
    The supporting affidavit made by the cashier of the plaintiff alleges the execution of the note as described, and the genuineness of the signatures of the maker and indorsers; and that before the maturity thereof the said note was delivered to the plaintiff, discounted to the credit of the Samuel H. Moore Company, and the money paid to it. The affidavit states that demand was made of the maker, and that the note has never been paid, the amount due being $1,190 with 6 per cent interest from January 2, 1910, exclusive of all set-offs and just grounds of defense.
    Pive pleas were entered by the defendant McKee, which present, in different forms, the one defense, that the plaintiff is not the legal owner and holder of said note, because the indorsements thereon show it was deposited to the credit of Samuel H. Moore Company, with guaranty of payment, but without transferring title and ownership. The affidavit of defense alleges the same thing. Execution of the note, demand for payment, and the discount of the same, and payment pf the proceeds to the Samuel H. Moore Company are not denied, nor any other defense alleged.
    
      Mr. Meter J. May for the appellant.
    
      Mr. Charles F. Carusi for the appellee.
   Mr. Chief Justice Shepard

delivered the opinion of the Court:

The assignments of error present a question of law only. The contention is that the effect of the first rubber stamp indorsement is to constitute the plaintiff the holder of the note for the credit of the Samuel H. Moore Company, and the second is a guaranty of payment merely by the Samuel H. Moore Company and Samuel H. Moore, and not sufficient to pass the legal title to the plaintiff. The case relied on in support of the contention is Central Trust Co. v. First Nat. Bank, 101 U. S. 68, 25 L. ed. 816. In that case the Wyandotte Bank, under an arrangement with the Cook County Bank, executed its note for $5,000 to the order of the latter bank. The arrangement was that the Wyandotte Bank should execute the note, and have the same discounted by the Cook County Bank. The proceeds were to be entered to the credit of the Wyandotte Bank, but not to be drawn against so as to reduce it below $4,000. To the note were attached as collateral security certain county bonds of the face value of $6,000. The Cook County, Bank was to hold the note as a memorandum, and it was not to be negotiated or separated from the bonds. The sum of $4,000 remained on deposit as agreed, until the Cook County Bank failed and passed into the hands of a receiver. At that time there was an additional credit of the Wyandotte Bank of $868. Before the maturity of the note the Cook County Bank, in violation of the agreement, delivered the note to the trust company, the bonds being retained. The trust company had no knowledge of the agreement concerning the note. The Wyandotte Bank, tendering the balance of $132, filed a bill against the receiver and the trust company to compel the surrender of the note and bonds. It was said by the court: “Tbe note was not indorsed to tbe trust company, and it was not therefore taken in tbe usual course of business by that mode of transfer in which negotiable paper is usually transferred. Had it been indorsed by tbe Cook County Bank, it may be that tbe trust company would bold it unaffected by any equities between tbe maker and tbe payee. But instead of an indorsement, tbe president of tbe Cook County Bank merely guaranteed its payment, and banded it over with this guaranty to tbe trust company. The note was not even assigned. There was written upon it only tbe following: ‘For value received, we hereby guarantee tbe payment of tbe within note at maturity, or at any time thereafter, with interest at 10 per cent per annum until paid, and agree to pay all costs and expenses paid or incurred in collecting tbe same. B. F. Allen, President.’ In no commercial sense is this an indorsement, and probably it was not intended as such. Allen bad agreed that tbe note should not be negotiated, and for this reason, perhaps, it was not indorsed. That a guaranty is not a negotiation of a bill or note as understood by tbe law merchant is certain. * * * In this case, tbe guaranty written on tbe note -was filled up. It expressed fully tbe contract between tbe Cook County Bank and tbe trust company. Being express, it can raise no implication of any other contract.”

The conditions of tbe case at bar are quite different. Tbe note was first indorsed in blank by tbe Samuel H. Moore Company and Samuel H. Moore. It was discounted, and tbe proceeds paid over to tbe indorser. Tbe affidavit of defense, following tbe pleas, does not deny tbe execution and delivery of tbe note, nor does it allege any equity of tbe maker against tbe payee. It raises tbe question of legal ownership only by tbe plaintiff. Tbe first indorsement was sufficient to pass tbe title to tbe indorsee. Code sec. 1334. Even if tbe subsequent rubber stamp indorsements are to be considered as restrictions of tbe first, constituting tbe indorsee tbe agent or trustee, merely, of tbe indorser, tbe indorsee has tbe right to bring any action thereon that the indorser could bring. Code sec. 1341 [31 Stat. at L. 1400, chap. 854.]

Whether the first indorsement was restricted or qualified by the subsequent indorsements (one unsigned, the other signed), so that any equities of the maker against the payee would be preserved, is a question that does not arise.

We find no error in the judgment, and it will be affirmed, with costs. Affirmed.  