10 Wash. 185 | Wash. | 1894
The opinion of the court was delivered by
This action was brought by appellant against S. D. Gustin, George W. Tibbetts, Thomas Jose and Alonzo Jose, partners, under the firm name of Jose & Son, to recover the balance due on a promissory note for $2,500,
The complaint alleged the execution of the note, and that no part thereof had been paid except the sum of $1000 on account of principal, and certain other sums as interest, paid thereon at dates specified therein, and demanded judgment against the defendants for the sum of $1,500, with interest thereon from November 8, 1891, and for attorney’s fees and for costs. The defendants Gustin and Tibbetts, although duly served with process, did not appear in the action, and the plaintiff took judgment against them by default.
The defendants, Jose & Son, appeared and filed an answer. They did not controvert any of the allegations of the complaint, but averred as affirmative defenses :
First, that they joined as makers of the note described in the complaint for the accommodation merely of their co-defendants, S. D. Gustin and George W. Tibbetts ; that they never had any interest in the consideration and never received any benefit directly or indirectly by the execution or delivery of said note, and that plaintiff knew when said note was delivered to and received by it that these defendants were in fact sureties only for their said co-defendants upon it; that at or after the maturity of said note the plaintiff in consideration of money paid to it by their said co-defendants for the future use by them of the principal of said promissory note for some months thereafter, bound.itself to allow their said co-defendants that time to make payment and prolonged the payment accordingly; that these defendants did not know of said transaction between their co-defendants respecting said prolongation of time nor have they ever assented thereto, or ratified the same or acquiesced therein or waived the right to take advantage thereof; and,
Second, that on the 24th day of February, 1891, their said co-defendants made a certain promissory note in writing of that date and delivered the same to plaintiff, and thereby further promised to pay to plaintiff or order, ninety days after said date $2,500, with interest at one per cent, per month from
The plaintiff in its reply denied the allegations in the answer showing that the defendants were sureties for the co-defendants Gustin and Tibbetts, and the extension of the time of payment of the note in suit; admitted the making of the note of February 24, 1891, as alleged, but denied that it was ever delivered to or received by plaintiff in payment of the promissory note described in the complaint, or otherwise ; admitted that said Gustin and Tibbetts, on May 26, 1891, paid to plaintiff $1,000, but denied that said payment was made on account of the said promissory note of February 24, 1891, or otherwise than as a payment on the promissory note described in the complaint, and admitted that on May 25, 1891, the said Gustin and Tibbetts made a further note for $1,500, as alleged, but denied that the same was delivered to or accepted by plaintiff in payment of the residue of said note, or otherwise.
The jury returned a verdict in favor of Jose & Son, which
There are some undisputed facts and circumstances, showing how the defendants in this action came to execute the note in controversy, which it is proper to state, before proceeding to discuss the errors assigned, as they tend, to some extent at least, to throw light upon subsequent transactions which will hereafter be considered. They are these : On February 26, 1890, one W. W. Beck and twelve others, including the defendants Gustin and Tibbetts, gave their note to the defendants Jose & Son for $3,500, payable ninety days after date. This note was negotiated at the plaintiff bank, and was thereupon endorsed by Jose & Son and Samuel D. Gustin and Geo. W. Tibbetts in the order named. When this note fell due it was not paid, but Gustin and Tibbetts paid $500, and thereupon, on May 27, 1890, the said Gustin and Tibbetts and Jose & Son gave to the plaintiff a note for $3,000, due ninety days after date. On August 25, 1890, said Gustin and Tibbetts paid $500, which was credited upon the note of February 26, 1890, and the said note for $3,000 was surrendered, upon the execution of another note to plaintiff by the same parties for the sum of $2,500, due three months after date, which was August 25, 1890. This note was not paid at maturity but on November 23, 1890, the note in suit was executed for the same amount, signed by said Gustin and Tibbetts and said Jose & Son, and thereupon the plaintiff surrendered to the makers thereof the said note of August 25, 1890. On February 25, 1891, the said Gustin and Tibbetts signed and delivered to plaintiff a note for $2,500, due three months after date, which defendants Jose & Son did not sign. On May 20, 1891, the said Gustin and Tibbetts paid to the plaintiff $1,000, which
From what we have stated it will be seen that the respondents endorsed the note of February 26, 1890, and signed as makers each subsequent note up to and including the one in suit, but that neither of the two later notes described in their answer were executed by them.
The respondents relied entirely at the trial upon the giving and receiving of these last two notes, together with the attendant facts and circumstances, to establish the affirmative defenses set forth in their answer. And the appellant contends that the evidence is wholly insufficient as to each of said defenses, to justify the verdict of the jury, and that the court therefore erred in denying the motion for a new trial, and we are of the opinion that the position is well taken. While the evidence fairly shows that the respondents signed the several notes upon which their names appear for the accommodation of Gustin & Tibbetts, and were, therefore, as to them, merely sureties, we are constrained to conclude that it is entirely insufficient to justify a finding by the jury that the respondents were discharged either by payment or extension of time. It was alleged in the answer of the respondents that the note of February 24, 1891, for $2,500, was given and received in payment of the note upon which this action is based, and that the note of May 25, 1891, for $1,500, was given to and received by appellant in payment of the residue of said note of February 24, 1891. But the proof clearly shows that it was the understanding of all the parties thereto that this last mentioned note, like the previous one, should be signed by Jose & Son, and that it was not to operate either as payment or as an extension of
Q. “ Did you agree with them (Gustin and Tibbetts) in regard to any extension before Jose & Son should have signed the note ?”
A. “I agreed to no extension that was not secured by a complete note, that note must be complete before I accepted it. Without Mr. Jose’s signature it was not complete.”
This is substantially all of the testimony in regard to the making and delivery of this note, and it certainly fails to prove either payment or an extension of the time of payment of the note in controversy in this action. It is true that a transcript of appellant’s book of bills receivable was introduced in evidence, from which it appears that every note of the series mentioned was noted in the column “Notes Paid,” as a payment of the preceding one, but it also appears therein that each note so entered as paid is described as the note of Gustin and Tibbetts and Jose & Son. Taken altogether, therefore, this transcript from the books is entitled to little, if any, weight as evidence upon one side or the other, in view of the positive and uncontradicted testimony of all the parties to the transaction in question.
We think this note never represented the understanding of the parties — in fact never became a completed instrument — and was, therefore, ineffectual for any purpose. Indeed, it is frankly conceded by the learned counsel for the respondents that if there had been no other transaction between the parties after this note was given, the appellant might be entitled to recover from the respondents, but they insist that the receiving of the $1,500 note of May 25,1891,
As before stated the note in suit was not taken up, and the testimony seems positive on the part of the bank that it was not considered paid or affected by these subsequent notes. Mr. Chapin,- the President of the Bank, says it was understood all along that Jose & Son were to sign these notes, and that he spoke to Mr. Jose about it, and that the latter said, in substance, at one time, that he did not know whether he ought to do so or not, and at another, that he was informed that he was not liable thereon. Mr. Jose states, in effect, that he does not recollect having made these declarations.
Mr. Chapin further states that it was known by the bank, at the time these last two notes were executed, that Gustin and Tibbetts were insolvent, and that the bank never intended to extend the time of payment of the note in question -or to receive either of the notes dated respectively February 24 and May 25, 1891, as payment. The mere circumstance that the officers of the bank may not have requested Gustin and Tibbetts to have Jose & Son sign the last note, at the
At the trial the plaintiff requested the court to charge the jury as follows:
“ If the jury are satisfied from the evidence that such an extension as is mentioned in the preceding instruction was made by the plaintiff to Gustin & Tibbetts, yet the jury are instructed that such extension would not operate to discharge Jose & Son from their liability on said note though thej’- were but sureties, if the plaintiff at the time of the extension, as aforesaid, reserved its rights against the sureties.”'
The court, in giving this instruction, modified it by adding thereto the words "and notified them of that fact at the time of such extension.” This was error. Byles on Bills (Woods’ ed.), *256; Morse v. Huntington, 40 Vt. 488; Potter v. Green, 6 Allen, 442; Tobey v. Ellis, 114 Mass. 120.
As to payment of notes by renewals the court instructed the jury :
‘‘When a bank takes a note, a new note in place of one which has become due and matured, the law presumes that a payment of the note ; that presumption can be rebutted, however, by testimony showing a different agreement between the parties; but without any agreement it is presumed to be a payment.”
Appellant claims that this was also error. Upon this, question the decisions are not harmonious, but we are inclined to the opinion that the great weight of authority is in favor of appellant’s position, that payment is not presumed in such cases, but is a question of fact depending upon the intention of the parties. 2 Parsons, Notes and Bills, pp. 150 to 153, and notes; Byles on Bills (Woods' ed.), *386; Brown v. Olmsted, 50 Cal. 162; 5 Dawson, Rights, Rem. and Prac., § 2537; Muldon v. Whitlock, 1 Cow. 290 (13 Am. Dec. 533-537); Blunt v. Walker, 11 Wis. 334 (78 Am. Dec. 709).
Hoyt, Stiles and Scott, JJ., concur.