Braasch v. Bonde

191 Wis. 414 | Wis. | 1926

EschweileR, J.

In the findings there is no express determination that the plaintiff and defendant Nicholas agreed to extend the time of payment until November 24, 1925, the definite and only date asserted in the several answers and testified to by Nicholas. From his written decision and the findings, however, the trial court seemingly considered that the payment of an increased interest rate with an agreement to extend the time of the note to each successive interest-paying time, even if not to the definite date of November 24, 1925, Being upon sufficient consideration, namely, the increased rate of interest, would any one of them operate so as to release the accommodation signers.

Mere forbearance to sue upon an overdue indebtedness, even though there be a valuable consideration, as for instance here, an increased interest rate, is not sufficient of it-} self to operate as a discharge of sureties or accommodation makers. The same is true of prepayment of interest or of paying an increased interest rate. In order to effect such result the forbearance must be because of and upon a valid, distinct, and definite agreement to forbear. Union Nat. Bank v. Cross, 100 Wis. 174, 177, 181, 185, 75 N. W. 992; Fanning v. Murphy, 126 Wis. 538, 554, 105 N. W. 1056; Welch v. Kukuk, 128 Wis. 419, 421, 107 N. W. 301; Grace v. Lynch, 80 Wis. 166, 49 N. W. 751.

The citations found in those cases show the samé rule elsewhere, and it is now the same as it -was then in Massachusetts (Barber v. Rathvon, 250 Mass. 479, 488, 145 N. E. 866; Mumford v. Coghlin, 249 Mass. 184, 190, 144 N. E. 283); and it is so held in Berry v. Pullen, 69 Me. 101, 103.

The only alleged agreement relied upon by defendants and supported by any testimony is that in November, 1921, the time of payment was extended until November, 1925. Such alleged agreement involved a promise on the part of the plaintiff to forbear bringing action upon such note during a period of more than one year thereafter, conditional upon and supported by an undertaking by defendant Nicholas that he on his part would perform, namely, by paying an increased rate of interest at semi-annual periods until and including November, 1925. It involved, therefore, something to be performed by each after the year following the making of the promise. The final payment of interest due in November, 1925, was not made or tendered.

Appellant, the plaintiff, now, and apparently for the first time, asserts that if there were such an agreement to extend the time of payment until November, 1925, being oral it is void under the statute of frauds, sub. (1), sec. 241.02, providing that every agreement which, by its terms, is not to be performed within one year from the making thereof shall be void unless it be in writing, expressing the consideration, and subscribed by the party sought to be charged.

No objection was interposed on plaintiff’s behalf on the trial as to the possible incompetency of the oral testimony offered and received concerning such agreement, and at the opening of the trial defendants’ counsel stated that the extension agreement relied upon by them was not in writing.

While as a general rule this court may and does refuse to consider and dispose of questions not properly or timely presented for consideration of the trial court, as has been stated in a number of cases, among others Leickem v. Babe, 189 Wis. 602, 605, 208 N. W. 462; In re Assignment of Milwaukee S. & W. Co. 186 Wis. 320, 329, 202 N. W. 693; Harrington v. Downing, 166 Wis. 582, 585, 166 N. W. 318, yet, as stated in Dupont v. Jonet, 165 Wis. 554, 558, 162 N. W. 664, and in Cappon v. O’Day, 165 Wis. 486, 162 N. W. 655, it unquestionably has the power to and may consider the entire record and dispose of questions of law clearly presented on the record, and as in the latter case illustrated, where (p. 491) it was held that the question of the validity of a chattel mortgage dependent upon the terms of the filing statute could be so determined though here first presented, and so we now feel it proper to pass upon the question of law. We are not unmindful that in other jurisdictions such procedure would not be followed. Kottler v. New York Bargain House, 242 N. Y. 28, 37, 150 N. E. 591.

There are opposing views among the authorities on the question as to whether or not an agreement to pay money is such an agreement as is intended to be covered by the language of the statute of frauds above cited. The weight of authority, however, is that it is within such statute. Browne, Statute of Frauds (5th ed.) § 283; 27 Corp. Jur. 185; 25 Ruling Case Law, 466. To the authorities there cited may be added Bartlett v. Pitman, 106 Me. 117, 119, 75 Atl. 379; Turner v. Williams, 73 Me. 466, 470; Bangs, Berry & Carson v. Nichols, 47 N. Dak. 123, 181 N. W. 87; Thompson v. Ford, 145 Tenn. 335, 236 S. W. 2; Reed v. Watson (Tex. Civ. App.) 262 S. W. 178.

It was said in Kelly v. Thompson, 175 Mass. 427, 430, 56 N. E. 713: “An oral contract for the payment of money which is, by the terms of the contract, to be paid more than a year after the date thereof is within the statute of frauds, though the consideration therefor is delivered at the date of the contract.” That decision refused to enforce an oral promise to allow a discount more than a year later. See, also, Marcy v. Marcy, 9 Allen (91 Mass.) 8.

The question has not been squarely passed upon in this state, although language is used in several decisions which might seem to require the conclusion that it is the law here that such agreements need not be in writing although not to be performed within the year. In Phillips v. Holland, 149 Wis. 524, 136 N. W. 191, $17.50 was paid at the time of the making of an oral agreement to extend the time of payment of a note for more than one year. Such payment was the only consideration for the promise ft> extend, and being then paid it became, so far as the debtor was concerned, an executed agreement; the court saying: “The fact that it was not in writing does not affect its validity.” To this statement there was only cited Grace v. Lynch, 80 Wis. 166, 49 N. W. 751, and Fisher v. Stevens, 143 Mo. 181, 44 S. W. 769.

In Grace v. Lynch, supra, it was held that payment before due of the interest on a note is sufficient consideration to extend the time, and it is taken out of the statute because, being fully executed by the one obtaining the extension, it is analogous with the situation arising out of a parol sale and complete delivery of' goods which.are not to be paid for in full until after the expiration of a year. The court stated that it is fully committed to the doctrine that in such a situation, namely, where there is an executed consideration, there is thereby a taking out from the statute; and several cases to that point are cited: McClellan v. Sanford, 26 Wis. 595, where the statute of frauds was set up as against an alleged promise to pay, after the one year, $1,200 on a certain mortgage note; the consideration for such promise was a conveyance of land and an assignment of certain railroad stock, both such being executed within the year; numerous cases are cited (p. 609), and it was then held that a verbal promise to pay beyond the year, if made upon an executed consideration, is valid. The McClellan Case was followed in Jilson v. Gilbert, 26 Wis. 637. In Treat v. Hiles, 68 Wis. 344, 32 N. W. 517, a verbal agreement to forthwith work a quarry was held not within the one-year statute (p. 355), stating (p. 357) that performance by one party within the year takes the contract out of the statute. Washburn v. Dosch, 68 Wis. 436, 32 N. W. 551, also cited in Grace v. Lynch, supra, involving a promise not to engage in the same business for five years in part consideration of an executed sale of goods, held that an agreement fully executed by one party within the year, although not to be performed by the other within the year, is valid. In the other case cited in Phillips v. Holland, 149 Wis. 524, 136 N. W. 191, supra, of Fisher v. Stevens, 143 Mo. 181, 44 S. W. 769, an equitable defense was interposed involving the question of an oral agreement to extend the time of the payment of a debt for a definite period, and it was there held that such an agreement, made after a note became due, when supported by a valuable consideration, though verbal, may be interposed as a bar to an action upon the note brought within the extended period, stating (p. 190) that if a 'creditor enters into a binding contract giving further time to the principal debtor without the consent of the surety the latter is discharged; but it must be noted that there the consideration for the promise to extend was fully carried out at the time the promise was made, and therefore the case, upon the facts, involved no more than was presented in the Wisconsin cases supra. This Fisher v. Stevens Case is referred to in Baade v. Cramer, 278 Mo. 516, 530, 213 S. W. 121, and again in People’s Bank v. Smith (Mo.), 263 S. W. 475.

Not being bound by any former rulings of this court to the contrary, we therefore feel free to follow that which seems to be the better reason and logic, namely, that the statute of frauds in question, making void contracts not to be performed within a year and not in writing, applies to just such contracts as are here involved, namely, extending the time of the payment of a promissory note. - In that view, therefore, there is no support in the record for the conclusion that the defendants, other than Nicholas Bonde, who signed the promissory note here in suit, can be released or discharged from the obligation -they thereby assumecj.

By the Court. — Judgment reversed, with directions to render judgment as herein indicated.