223 N.W. 459 | Minn. | 1929
January 16, 1914, the then owner, Hokanson, mortgaged the Minneapolis residence property in question to defendant for $1,200. The mortgage was negotiated through John A. Lane, a real estate and loan broker now bankrupt. April 15, 1916, Hokanson conveyed the property to plaintiff subject to the mortgage. Interest instalments as they accrued were paid to Lane, who in turn remitted *400 them to defendant. There was a renewal of the mortgage in 1917 and another January 16, 1920. On that date plaintiff paid interest then due and also $100 in supposed reduction of the principal. Since then she has paid to Lane the remainder of the principal, but he has converted all of it to his own use. Defendant has never received any of the payments except those for interest. The issue is whether Lane was authorized to collect the principal for defendant or, in default of such authority, whether defendant has in any way estopped herself from denying its possession by Lane. Express authority in Lane is not claimed. At no time did he have in his possession for collection or otherwise the note. Neither did he have the mortgage. Plaintiff is inexperienced in business affairs and explicitly testified that she "relied entirely on" Lane; that she does not "understand business," but had entire confidence in Lane.
1. In view of our recent decision of the similar case of Johnson v. Howe,
It is the law as argued for appellant that an erasure and alteration of the kind here in question, in the absence of evidence to the contrary, will be presumed to have been made prior to the delivery of the note, Healy-Owen-Hartzell Co. v. Montevideo F. M. Elev. Co.
2. A final argument for plaintiff is that the extension agreement was the primary evidence of the debt, and that Lane, having possession of it, was as to plaintiff possessed of apparent authority to collect. We cannot agree. The extension agreement on its face is an amendment of the original note to the extent that it postpones its maturity. In addition, it reasserts the obligation to pay and imposes it upon plaintiff. Notwithstanding, the extension agreement refers to the extension of the note and expresses the agreement of plaintiff "to pay the said principal note." While the extension agreement was literally a new contract, which is the result whenever an outstanding contract is amended, however slightly, by a new *402 agreement, yet the original note remained with the amendment as the primary expression of the obligation to pay. The extension agreement did not supersede it in that capacity. We cannot hold that the latter so far supplanted or merged the promissory note as the primary evidence of debt that its possession by a supposed agent will alone be evidence of authority from the creditor to make collection.
Judgment affirmed.