Kolovsky, Bischoff and Botter.
Defendant Anna Berenyi appeals from a judgment for plaintiff based on the following stipulated facts:
1. On May 25, 1964, in a proceeding brought by Arthur J. Sills, Attorney General of the State of New Jersey against Kroyden Industries, Inc., a corporation of the State of New Jersey, in the Superior Court of New Jersey, Chancery Division, Essex County, a Consent Order was made by Honorable Ward J. Herbert, J.S.C., which Order enjoined the said Kroyden Industries, Inc. from committing certain acts or making certain representations with its customers in connection with the sale of carpeting.
Copy of the said Order is attached hereto and part hereof. [Attachment omitted].
2. In August, 1964, the defendants, Andrew Berenyi (now deceased) and Anna Berenyi, were referred from a participant in a sales scheme of Kroyden Industries, Inc., for the purchase of carpeting.
3. An employee of Kroyden Industries, Inc. offered, in violation of the injunction aforesaid, to give to the defendants carpeting which, if the contract price of $1,100.00 was paid, was worth $44.00 per square yard without making any payments as long as they referred prospective buyers to Kroyden Industries, Inc.
4. The defendants agreed to this plan since the carpeting would not cost them anything as long as they made the required referrals.
5. The defendants, relying upon the above offer and representations signed a negotiable promissory note for $1,521.00. Said instrument was negotiated to the plaintiff herein.
6. The plaintiff is a holder in due course for value of the negotiable promissory note sued upon and had no knowledge or notice of the proceedings brought by Arthur J. Sills, Attorney General of the State of New Jersey against Kroyden Industries, Inc.; and had no knowledge or notice of the entry of the Order in the Chancery Division by Judge Herbert; and had no knowledge or notice that Kroyden Industries, Inc., violated the aforementioned injunctive Order.
The trial judge ruled that the fact that the note was obtained as part of a transaction entered into by Kroyden Industries, Inc. (Kroyden) in violation of the injunctive order was not a defense in an action brought by plaintiff, whose status as a holder in due course, with no knowledge or notice of the injunctive order, was admitted.*fn1
The controlling issue presented is whether the defense here asserted is a "real" defense or a "personal" defense. Real defenses are available against even a holder in due course of a ...