19 Ind. App. 406 | Ind. Ct. App. | 1898
— The appellants sued appellee upon the following instrument: “$500.00. Elkhart, Ind., May 20th, 1890. For value received, I promise to pay to Seneca D. Kim bark or order, the sum of five hundred dollars, payable at the First National Bank, Elkhart, Indiana, with 8 per cent, interest after maturity and attorney’s fees, without relief from valuation or appraisement laws. This note is given in consideration that said payee will remove and locate his entire manufacturing establishment to the vicinity of Beardsley avenue and Myrtle street. Said factory to be placed in brick buildings, having a floor room of not less than 80,000 square feet. This note due and payable as soon as said buildings are erected and
The complaint upon which the case was finally tried was in one paragraph, and averred, in substance, that appellee executed to Seneca D. Kimbark the note sued on, and that said Kimbark indorsed said note in writing to appellants, September 20th, 1891; that said Kimbark complied with all the conditions in said note except that the buildings in which his said factory was placed had a floor room of less than 80,000 square feet, to wit, 57,000 square feet, all of which was well known to appellee; that on September 23, 1891, appellee proposed to appellants that if they would extend the time of payment thirty days, he would pay it at the expiration of said time, which proposition they accepted, and did so extend the time, but that at the expiration of said time, he refused to.pay it. There was an averment that said note was due, and a copy of the note and indorsement wras filed as an exhibit. A demurrer to the complaint was overruled, and the appellee answered in two paragraphs.
The first paragraph avers that the note sued on was signed under certain circumtsances, to wit, that said Kimbark proposed to certain citizens of Elkhart, that if they would donate to him six acres of land near the city of Elkhart, and $10,000.00 in money, he would locate his entire manufacturing establishment in said city, to be placed in brick buildings with a floor capacity of not less than 80,000 square feet; that certain of the citizens undertook to procure said donation by subscription, and for such purpose caused notes to be written in blank to be signed-by such persons as desired in aid of such subscription; that the note sued on is one of said notes and was signed by appellee, and delivered to one Henry C. Dodge as a subscription to aid in making said donation, upon said proposal.
It is further averred that appellee never did make and authorize the delivery of said note to be used as a subscription or donation to the last mentioned agreement; that appellee believed that said note had been delivered to said Kimbark upon and under the terms of said first agreement, and upon the conditions precedent stated in the note, etc. This paragraph of answer is verified, and a demurrer to it was overruled, and appellants excepted. The second paragraph of answer was a general denial, and appellants replied to the first paragraph by a general denial. There was a trial by the court, a special finding of facts, conclusions of law, and judgment for appellee. Appellants have assigned errors in six specifications, but they are all waived by a failure to discuss them, except the fifth and sixth, which are as follows: Fifth. “The court erred in overruling appellants’ demurrer to the first paragraph of answer. Sixth. The court erred in its conclusions of law.”
Appellants have not furnished us with any authorities in support of their contention that the court erred in overruling their demurrer to the first paragraph of answer, and have not convinced'us by their argument that the answer was bad. They contend that the complaint avers a waiver of the conditions of the note, and that the answer does not deny such waiver, but there are averments in the answer which made it good.
Before considering the sixth assignment of error, it is necessary to state as briefly as possible, the facts found and the conclusions of law stated thereon. The facts as found, so far as they are pertinent to the determination of the question here presented, are as follows: (1) That prior to May 30, 1890, one Kim-bark proposed to the citizens of Elkhart, Indiana, to remove his factory from Quincy, Michigan, to Elkhart, if they would donate to him six acres of land as a factory site, and $10,000.00 in money, to be due and payable as soon as the buildings were erected; said buildings
This is the second appeal of this case. In the former appeal the appellee here was appellant. Johnson v. Bucklen, 9 Ind. App. 154. Appellant insists that the decision in the former appeal is the law of the case to the end, and such is unquestionably the rule. But in the former appeal there were but two questions decided:
(1) That the complaint stated a good cause of action, in that the facts pleaded constituted a waiver of the conditions precedent stated in the note, and (2) That the facts found by the court were so defective that a judgment could not be rendered thereon in favor of appellees, and the judgment was reversed.
In so far as any question there decided is concerned, it constitutes the law of the case. In that appeal no question arose as to the answer, and therefore none was decided. But the record shows that after reversal and the case was remanded to the court below, an amended complaint was filed and a new answer.
We have said that the demurrer to the answer was correctly overruled, and it is now for us to determine,
Appellants insist that after the indorsement of the note to them by Kimbark, the appellee’s promise to pay it if they would extend the time of payment for thirty days, constituted a new contract, and thus brings the case within the rule announced in Brown v. First National Bank, 115 Ind. 572. We do not think so. In that case it was held that where the maker of a promissory note, not governed by the law merchant, agrees with the assignee thereof, to whom the note was signed before maturity, that if the latter would extend the time of payment for a definite term, he would pay the same at the expiration of such period, and the time was so extended, such promise of the maker, constituted a new contract, binding in law, and, capable of enforcement, though the maker had a good defense to the note before its assignment. There the note was transferred before maturity, and for a valuable consideration. It is urged by appellants that the proposals of Kimbark, stated in the first finding, were merged in the note sued on, and after its execution it became the contract between the parties, which could not be varied by parol evidence. Ordinarily this is true, but there are exceptions.
In cases of the character we are now considering,— subscriptions or donations to enterprises,, — the whole contract enters into the subscription contract, note or paper, whether written therein or not. Even in ordinary promissory notes, or other written promises to pay money, it is competent to show by parol what the consideration was, or whether or not there was any consideration upon which such writing was executed.
The answer further avers that appellee delivered the note to Dodge, to be delivered as a subscription upon the first mentioned agreement, and for no other purpose, and never authorized its delivery to be used as a subscription or donation to the last mentioned agreement; that on the several^times of each of the conversations as alleged in the complaint, the statements and promises made by him, he supposed and believed that the note had been delivered to Kimbark upon and under the terms of said first contract, and upon the conditions precedent in said note, and, but for such belief, he would not have made such statements, etc.
Bearing upon the propositon that a written contract may be varied by parol evidence, we cite the following: Burton v. Morrow, 133 Ind. 221, 227; Kentucky and Indiana Bridge Co. v. Hall, 125 Ind. 221; Wolfe v. McMillan, 117 Ind. 592; Armstrong v. Cook, 30 Ind. 22; Welz v. Rhodius, 87 Ind. 1, 44 Am. Rep. 747.
It is apparent from the whole record, and especially from the finding of facts, that the note in suit was one of many that had been executed in aid of a certain enterprise, and were given in pursuance to a contract between appellants and Kimbark. The terms of that contract were known to appellee when he executed the note, and, in the sense of being in aid of the execution of that contract on the part of appellants, must be considered a part of it. The note was given under Kimbark’s first proposal or agreement, and not upon the second, and the one that was finally consummated.
The second proposal or agreement differed materially from the first, and while Kimbark could make a new contract for himself, he could not make a new contract for appellee, and bind him thereby, without his knowledge or assent thereto. Such material
If appellants have any right'of action here, it rests solely upon the promise of appellee to pay the note, if they would extend the time of payment thirty days. At the time Kimbark indorsed the note to appellants, he had no right of action under it, for the reason he had already been paid the entire consideration guaranteed to him by his contract with appellants, and as he had no right of action, his indorsement of the note to appellants did not carry with it, or vest in them, any right of action, for he could not transfer a right he did not possess.
There is no averment in the complaint and no finding that any consideration passed to Kimbark from appellants on account of the indorsement of the note to them. We must assume from the complaint itself that appellants recognized the fact that they could not recover on the note, for it is averrqd that appellee proposed to the appellants that if they would extend the time of payment thirty days, he would pay it at the expiration of said time. Hence it is plain that they rest their right to recover wholly upon the promise to pay, in consideration of their extending the time of payment. This promise to pay was without any consideration, for where there is a promise to pay money, in consideration of an extension of time of
The question of estoppel cannot arise, for appellants did not invest any money or other thing of value on appellee’s promise to pay, if they would extend the time oí payment. The note in controversy was not negotiable by the law merchant, and ai> pellee would have the same defense to it in the hands of appellants, that he would in the hands of the original payee. Suppose that Kimbark'had not indorsed the notes to appellants, and after its maturity appellee had agreed to pay it if the time of payment was extended for thirty days; would it be contended that such promise was based upon a sufficient consideration, so that Kimbark could enforce it? We think not. In Davis v. Stout, 126 Ind. 12, 22 Am. St. 565, it was held, that where an action had been commenced upon a promissory note, and an agreement in writing made to extend the time of payment for a definite period, upon payment of a certain sum, and ‘'a dismissal of the action, such agreement was without consideration. The question in that case arose as to whether or not the surety was released by virtue of the extension, and it was held that she was not, because there was no consideration for the extension. As bearing upon the question, see, also, Warey v. Forst, 102 Ind. 205; Emery v. Royal, 117 Ind. 305; United States Mortgage Co. v. Henderson, 111 Ind. 24; Mulholland v. Bartlett, 74 Ill. 58. We conclude, therefore, that appellee’s promise to pay, upon appellants extending the time, did not constitute an en-forcible contract. As we have above remarked, the note passed to the appellants after its maturity.
The complaint avers that the appellee waived the condition in the note that Kimbark’s factory was to
In the case before ns, appellee waived the shortage in the floor capacity of the factory, because he knew' of such shortage, but he did not waive the affirmative matters alleged in his answer, for he charges that he did not know of them, and the findings support the answer. He did not know that the proposition or agreement under which the note was given had been withdrawn and abandoned by Kimbark, and that a new contract had been entered into between Kimbark and appellants. He did not know that Kimbark and appellants had surrendered and canceled the potes given by others, under the same conditions and circumstances as those upon which appellee gave his note. He did not know that Kimbark, the orginal payee, had then received the $10,000.00 which appellants promised and guaranteed to him.-. He did not know that $350.00 in excess of the sum paid Kim-bark had been collected on subscriptions, and was then in the hands of appellants, and he did not know that Kimbark had no pecuniary interest in the note in suit when he indorsed it to appellants. All these facts appellants knew, and appellee was ignorant of them when he made his subsequent promise to pay, if the time of payment should be extended.
That Kimbark had no pecuniary interest in the note when he indorsed it to appellants, is evident from the fact that he had then received all that he was entitled to receive under his contract. A waiver is the intentional relinquishment of a known right. A person cannot be bound by a waiver of his rights,
In many cases it has been held that a waiver must be an intentional act, with knowledge of the facts. Darnley v. London, etc., R. W. Co., L. R. 2 H. L. 43, 57; Traynor v. Johnson, 1 Head (Tenn.) 51; Fuller v. Bean, 34 N. H. 290; Farlow v. Ellis, 15 Gray (Mass.) 229; Smith v. Dennie, 6 Pick. (Mass.) 262; Hammett v. Linneman, 48 N. Y. 399; Hoxie v. Horne Ins. Co., 32 Conn. 40; Lewis v. Phoenix, etc., Ins. Co., 44 Conn. 91; West v. Platt, 127 Mass. 372; Holdsworth v. Tucker, 143 Mass. 374, 9 N. E. 764.
The facts found by the trial court fully sustain appellee’s first paragraph of answer, and the conclusion of law stated thereon, correctly declared the rights of the parties. Judgment affirmed.