Austin v. Fuller, 12 Barb. 360

12 Barb. 360 | N.Y. Sup. Ct. | 1852

By the Court,

Hand, J.

It has been said that a party may show an agreement, by parol, to pay an additional sum, at some future day, as interest on a note or bond upon which lawful interest is reserved. (Macomber v. Dunham, 8 Wend. 554. Merrills v. Law, 9 Cowen, 65. Cowen & Hill’s Notes, 1476. Woodward v. Reynolds, MSS. 4th Dist.) Cowen & Hill cite Hammond v. Hopping, (13 Wend. 510, 511.) An attempt was there made, to prove a second note for the additional interest; and also to show admissions, which, however, did not tend to prove an executory agreement. Merrills v. Law was afterwards reversed,^(a) but this point was not noticed.

If different instruments are given, they may be considered as one transaction. And one may give a note for a part of a debt, and agree," by parol, to pay the balance. And the law will not be defeated by any device to cover usury.

But upon plain principles of evidence, it is not very clear how a parol agreement to pay additional interest on a note can affect the note. Had the note reserved no interest, it would not have been admissible to prove, by parol, a simultaneous agreement to pay interest. That would be directly varying a written instrument, by parol. (Norton v. Woodruff, 2 Comst. 153. Erwin v. Saunders, 1 Cowen, 249. Chit, on Cont. 97, 98.) Fraud may always be proved by parol; but it is a little singular that proof of a parol executory agreement, which would be entirely nugatory, if there were no usury laws, should be admitted to make a contract illegal; particularly, in cases where no part of the executory agreement has been performed. However, my brethren are inclined to follow the cases, or dicta therein which I have noticed, and perhaps they are binding upon this court.

The plaintiff contends that, admitting the existence and admissibility of this parol contract, as it was made solely with John, the other two defendants were not bound by, nor can they take advantage of it. But if void as to one, for usury, it is as to all, and sureties may interpose this defense. (10 Paige, 583. 9 Id. 137, 197. 10 Wheat. 367. 4 Peters, 205. 2 Hill, 522, 656. 11 Wend. 329. 13 Id. 505.)

But I think the judge erred in admitting John Fuller, the principal debtor, as a witness for his sureties, and co-defendants. In a few cases, under the code, this incompetency of a co-defendant has been limited to a party to the issue. (Safford v. Lawrence, 6 Barb. S. C. Rep. 566; Mechanics and Farmers’ Bank v. Rider and Wilbur, 5 How. Prac. Rep. 401; Parsons v. Pierce, 8 Barb. S. C. Rep. 655.) In Safford v. Lawrence, the witness was a bankrupt, having no interest in the event of the suit. No process had been served upon him, but his appearance was wholly voluntary, and that had been stricken out of the cause. Parsons v. Pierce was an action for a tort, upon which class of cases it is not now necessary to express any opinion. In Mechanics and Farmers’ Bank v. Rider and Wilbur, in which the opinion was prepared by the same judge as in Safford v. Lawrence, it is true, the defendants offered themselves, seriatim, as witnesses to sustain the defense of usury, and the judgment was reversed because they had been deprived of this interchange of testimony; Mr. Justice Parker, ddssentiente. By an amendment of the code, I think this question is now at rest. But as this trial was before that amendment, the case must be decided accordingly, (§ 397.)

The former rule was, that a party to the record could not be sworn in the cause; much less a joint contractor, for his co-defendant. In England, after judgment by default against one co-defendant, in an action ex contractu, it has been decided, overruling some earlier cases, that he may, if he consent, be called by the plaintiff. (Worrall v. Jones, 7 Bing. Rep. 395. Pipe v. Steele, 2 Adolph. & Ellis New Rep. 733. Haddrick v. Heslop, 12 Id. 267. Dresser v. Clarke,. 1 Carr. & Kirw. 569.) But not by his co-defendant, at least, unless there was some matter of personal discharge, or a nolle prosequi. (Butcher v. Forman, 6 Hill, 583.) And the judge who delivered the opinion in Safford v. Lawrence was mistaken in supposing that the witness was called to sustain the defense, in Worrall v. Jones. He was there called by the plaintiff. And so he was in Pipe v. Steele. And there are many decisions in England, and some since Lord Denman’s act, as well as in this country, against his admissibility in such cases. Some of them are recent, and were made in actions of tort. (Thorpe v. Barber et al. 5 Com. Bench Rep. [Man. Gra. & Sc.] 675. Mills v. Lee, 4 Hill, 549. Moon v. Eldred. 3 Id. 106, note a. Bohum v. Taylor, 6 Cowen 313. Bull v. Strong, 8 Metc. 8. Dresser v. Clark, 1 Carr. & Kirw. 569. Schermerhorn v. Schermerhorn, 1 Wend. 119. 1 Phil. Ev. 59, 62, 75. Townsend v. Downing, 14 East, 565. Wafer v. Giles, 6 Com. Bench Rep. [Man. Gr. & Sc.] 693. Cowen & Hill’s Notes, 113. Riddle v. Moss, 7 Cranch, 206. Munson and Suiter v. Hagerman, 5 How. Pr. Rep. 223. Dodge v. Averill, Id. 8. Merrifield v. Cooly, 4 Id. 272. Notes to Bent v. Baker in the Am. ed. of Smith’s Leading Cases.)^(a)

Haddrick v. Heslop, decided in 1848, -was an action of tort: and after a full examination of the authorities the court held the plaintiff might call a defendant who had suffered judgment by default, and the jury were also to assess the damages against him. And in Thorpe v. Barber, also decided in 1848, it was held, in an action of tort, that a defendant in such a case, was not admissible for his co-defendant, for he is interested to reduce the amount of damages, though a verdict for the other defendant would not enure to his benefit. And this doctrine was approved by Lord Denman in Haddrick v. Heslop. Both of these cases were after Lord Denman’s act.

The case of Hawkesworth v. Showler, (12 Mees. & W. 45,) in which are some obiter dicta, that one who has suffered judgment by default in an action of tort, was not a party to the record, was decided in 1843, five years before Thorpe v. Barber, and Haddrick v. Heslop. In The United States v. Leffler, (11 Pet. 95,) the witness had been severed from his co-defendants, by the giving and acceptance of a cognovit, on which judgment had been entered up, he imprisoned, and afterwards discharged as an insolvent. He could hardly be said to be still on the same record. (And see Butcher v. Forman, supra.)

Whether the legislature intended to extend the rule as to the examination of co-parties beyond the former practice in chaneery, it is not necessary now to determine. (See remarks of Mr. Justice Gridley in Munson v. Hagerman, supra.) It seems to me clear that a party to the record, and interested, can not he a witness for his co-defendant. Section 398 of the code removes the disability of interest, in ordinary cases ; but § 399 excepts aiparty. This I think gives a construction to § 397.

{Saratoga General Term, January 5, 1852.

It follows, that John Fuller was not a competent witness for the other defendants. He is a party and interested. Interested, because they were his sureties and he was bound to make indemnification ; and interested also, as their principal, in reducing the amount of damages; and because there could be but one assessment of damages against them; and again, because this being on contract, a judgment against him can not be sustained if the other defendants succeed. (1 Phil. Ev. 75. Townsend v. Downing, 14 East, 555. 11 Pet. Rep. 95, 97. 7 Cranch, 206. Notes to Bent v. Baker, Smith’s Lead. Cas. Am. ed. And see Bates v. Conkling, 10 Wend. 389, and the authorities before cited; Bohum v. Taylor, 6 Cowen, 313; Scott v. Lloyd, 12 Pet. Rep. 149.)

I think this judgment can not be sustained.

Judgment reversed.

Willard, Sand and Cady, Justices.]

(a) Law v. Merrills, (6 Wend. 268, 283.)

(a) Sea Law Library, vol. 44, pp. 59 to 100