130 P. 303 | Okla. | 1913
Plaintiffs in error, defendants below, were indebted to defendant in error, plaintiff below, on two promissory notes, one for $368.50, secured by chattel mortgage; a second for $500, which was unsecured. The note secured by the chattel mortgage was executed in the month of December, 1908; the unsecured note, in January, 1909. At the time of the execution of the notes, plaintiff in error, A. J. Carson, was a salesman in the employ of plaintiff, and it was agreed between the parties that the plaintiff was to deduct $50 per month out of each and every month's wages or earnings, the same to be credited on the said A. J. Carson's indebtedness. On the evening of the day that the second note was executed, it is claimed by said A. J. Carson that he notified David Dreeben, one of the partners of plaintiff company, that the accruing monthly credits should be applied on the secured note, and Dreeben, on behalf of the partnership, so agreed. The latter in his deposition testified that no such agreement was ever made by him as claimed by Carson. Defendant A. J. Carson continued in the employ of *14 the plaintiff for something over a year, and was entitled to a total credit of $625. Instead of applying the credits to the payment of the secured note, they were first applied by plaintiff to the payment of the unsecured note, and, after its payment, the balance was credited on the secured note. The case was tried before the court without the intervention of a jury. Special findings of fact and conclusions of law were made, of which the following form a part:
"I find that the defendant A. J. Carson at some time after the making of the two notes, one secured and one unsecured, to the plaintiff, requested one of the plaintiffs, Mr. Dreeben, to credit his payments, to wit, $50 a month, upon the secured note. I find, however, that the said Dreeben did not positively agree or enter into a contract so to do. I find that the defendant A. J. Carson did not make a demand for payment to be credited to the secured note at the time he made each particular payment thereon."
The conclusions of law predicated upon the findings of fact, in brief, were that the credits were properly applied, and that the plaintiff was entitled to recover a judgment for the possession of the property mortgaged to secure the payment of the first note. In the first place, it was not necessary that any agreement be made as to the application of the payments. The general rule is that, when a creditor holds more than one claim against his debtor, the latter on making a payment has the right to direct upon which debt it shall be credited, and it is only where no direction is given that the creditor can make the application; that, where a direction by the debtor to apply payments exists at the time the payments are made, it is the duty of the creditor to so apply them. Kent Barnett v.Marks Gayle,
Nor is the rule of the application of payments affected by the fact that one of the debts owing is secured, while the other is unsecured. Green v. Ford,
It was not necessary that Carson should direct the application *17
of the payments at the precise time that the payments were made or credits entered. This he could do beforehand. Having once notified the creditor upon what debt the credits should be entered, it was unnecessary to repeat this notice at the end of each month, or on each pay day. Petty v. Dill,
It is insisted, however, by counsel for plaintiff in error that the performance of work by a debtor for the creditor is not a payment within the rule allowing the debtor to direct the application of payment to a particular debt. Treating the payment made as services rendered, the general rule is to the contrary, as it is not necessary that the payment be made in money. It may be made in notes, or property, or labor. 4 A.
E. Enc. L. P. 1057. In Smith v. Vaughn,
For the foregoing reasons, the judgment of the trial court should be reversed, and the cause remanded.
By the Court: It is so ordered.
