206 P. 432 | Mont. | 1922
Lead Opinion
sitting in place of MR. JUSTICE REYNOLDS, disqualified, delivered the opinion of the court.
This cause of action is stated in three counts. In the first, the plaintiffs allege that they are copartners, and the Havre National Bank, defendant, is a corporation; that on the twenty-ninth day of September, 1917, Ever Nielsen was indebted to the plaintiffs in the sum of $1,833.27; that immediately prior to the twenty-ninth day of September, 1917, Ever Nielsen had made arrangements with the defendant, hereinafter referred to as the bank, whereby the bank was to take charge, supervision, and control of all the real and personal property of Nielsen
The second count sets forth the same facts as the first, except that in this count the bank is alleged to be a trustee, as follows: “That by reason of the action of the bank in accepting the real and personal property of Nielsen, and the sale thereof and the receipt of the proceeds under the conditions that the bank should use sufficient of the proceeds to pay the indebtedness of Nielsen to the bank and to the plaintiffs, the bank became, was, and is a trustee for the use and benefit of these plaintiffs in applying sufficient of the proceeds of the sale to pay the indebtedness of Nielsen to the plaintiffs,” and that the bank has failed to execute the trust.
The answer is, in effect, a general denial. By stipulation the cause was tried by the court without a jury. Plaintiffs prevailed in the district court. The bank appealed from the judgment and from, an order denying its motion for a new trial.
It is first contended by the bank that the third count, the one upon which the plaintiffs relied in the district court, does not state facts sufficient to constitute a cause of action, for the reason that it is not alleged that there was any agreement on the part of the plaintiffs to forbear to sue and attach. We have examined this count carefully, and do not believe the poinf is well taken. There is recited therein the promise on the part of the bank through Hitt, its cashier, that the plaintiffs’ claim would be paid out of the proceeds of the sale after the obligation of Nielsen to the bank was satisfied, if the plaintiffs would forbear the filing of suit, attaching the property and stopping the sale. It is further alleged that plaintiffs did, by reason of the representations made to them by the bank, forbear to sue Nielsen and attach his property, and that the bank at the time knew that plaintiffs would and did rely upon the promises and agreements of the bank and refrained from filing their action against Nielsen and attaching his property by reason of the promises and representations of the bank, and not otherwise.
Mere forbearance to sue, without an agreement to that effect, is not a sufficient consideration for a promise of another to pay the debt of the person liable; but such agreement may be either express or implied. “It is well settled that forbearance to sue is a sufficient consideration to support a promise. However, a mere forbearance to sue is not enough in the absence of circumstances from which an agreement to
While an express agreement to forbear to sue is not alleged, and the pleading is not a model, yet we hold that sufficient is set forth in this count to show an implied agreement to that effect.
It is next insisted that plaintiffs should have offered evidence to show that there was a balance from the proceeds of the sale after paying the indebtedness of Nielsen to the Bank, and that, having failed to do so, the motion for nonsuit should have been granted. The evidence on behalf of plaintiffs showed that after the auction sale, Mr. Ritt, the cashier of the defendant bank, and Mr. Nielsen were in the bank, "and there Mr. Ritt, with a list of all the bills that Mr. Nielsen owed and knowing the amount for which Nielsen’s property sold, made a computation, evidently with the view of determining how near the proceeds of the sale of Nielsen’s property would come to liquidating his obligations, and remarked to Nielsen: “Well, there is about $4,500 that would not be touched. You will have that much.” It is a well-settled rule that on a motion for a nonsuit everything is deemed proved which the evidence tends to prove. (Herbert v. King, 1 Mont. 475; Cain v. Gold Mt. Min. Co., 27 Mont. 529, 71 Pac. 1004; McCabe v. Montana Cent. Ry. Co., 30 Mont. 323, 76 Pac. 701; Stewart v. Stone & Webster Eng. Corp., 44 Mont. 160, 119 Pac. 568; Morelli v. Twohy Bros. Co., 54 Mont. 366, 170 Pac. 757.) The evidence produced by plaintiffs at least tended to show
Nielsen’s property sold for the following-amounts: Real estate, $36,000; sheep, $6,970; other personal property, $4,684.75. To refute plaintiff’s evidence that there was a balance after paying the bank, defendant offered to prove that there were not sufficient available funds to satisfy its claims against Nielsen, to which evidence plaintiffs interposed an objection which was by the court sustained. The bank then made the following offer of proof: “We will offer to show that the contract for sale to William Williamson was for the sum of $36,000 and as a part of the purchase price he was to assume two mortgages, one for $10,000 and one for $5,000. That was the contract with William Williamson, provided that we should furnish him with the title free and clear of all encumbrances except these two amounts; that ■at the time of sale to' Mr. Williamson there were the following encumbrances against the land: # * * The sum of $1,726.93, payable to J. B. Cox on a contract for purchase of land which was still due from Nielsen and covering the land included in the sale made to Mr. Williamson; the sum of $560.26 due to the Iowa Land Company on a mortgage given by Mr. Nielsen on land included in the land purchased by Mr. Williamson; the sum of $411.75, the amount of a judgment in favor of the St. Anthony & Dakota Lumber Company against Ever Nielsen, which item was a lien upon the land conveyed to Mr. Williamson; the sum of $1,338.23, the amount of a judgment in favor of the Monticello State Bank against Ever Nielsen, which judgment was a lien upon the land covered by the conveyance to Mr. Williamson; the sum of $8,000 which was paid to Mr. J. H. Schmedeke in settlement of a mortgage of $10,000 and interest, given by Mr. Nielsen to Mr. Schmedeke and covering the land included in the conveyance to Mr. Williamson; also the sum of $91.10 paid to Mr. Fred Schick on a judgment in favor of Fred Schick against Ever Nielsen which was a lien upon the land in question at the time of
Defendant offered in evidence its Exhibits “A,” “B,” and “D,” representing the indebtedness of Ever Nielsen to the bank, to which evidence plaintiffs interposed an objection, which was sustained. It then made an offer of proof. Exhibit “A” is a promissory note dated December 13, 1916, made, executed, and delivered by Ever Nielsen to the bank for the principal sum of $7,094.34, payable on demand with interest at the rate of eight per cent per annum from date thereof. Exhibit “B” is a promissory note dated October 5, 1916, made, executed, and delivered by Ever Nielsen to the defendant bank for the sum of $6,200, payable on demand, with interest at the rate of twelve per cent per annum from date thereof. Exhibit “D” is a promissory note, dated August 25, 1917, made, executed, and delivered by Ever Nielsen to the defendant bank for the sum of $1,578.25, payable on demand with interest at the rate of twelve per cent per annum.
We think the evidence included in both offers should have admitted, the first to show the amount of proceeds from the sale of Nielsen’s property available to apply on the bank’s
Plaintiffs contend, however, that the bank’s promise to pay their claim against Nielsen from the proceeds of the sale was unconditional, and therefore the offered evidence was immaterial. There was evidence admitted on behalf of plaintiffs, over the objection of defendant bank that its promise of payment was unconditional, but there is no allegation in the complaint that would permit such evidence and the same should have been excluded.
Plaintiffs also contend that, when the bank promised to pay them from the proceeds of the sale, it meant “gross proceeds,” and that therefore the first offer of proof was immaterial. There are cases holding that the word “proceeds,” when used in connection with the sale of property, means “gross proceeds,” and there are others holding that it means “net proceeds”; but we believe that the general rule, and the one supported by the weight of authority, is to the effect that the word is one of equivocal import, and its construction depends very much upon the context and the subject matter to which it applies. Applying this rule to the evidence in this ease, what did the parties mean by the word “proceeds”? At this time Nielsen’s property, both real and personal, was mortgaged. There were judgments against him. These were matters of record, and the parties hereto were charged with knowledge of the same. All these claims were superior to the bank’s claim to the proceeds of the sale. We then hold that, under the facts and circumstances in this case, the word “proceeds” means the sum for which the property sold after deducting the amount of the mortgages and judgments.
The court erred in excluding the evidence included in the offers of proof and also in admitting evidence of an unconditional promise by the bank to pay plaintiffs. The judgment and order are therefore reversed, and the cause is remanded to the district court, with directions to grant defendant’s motion for a new trial.
Reversed and remanded.
Dissenting Opinion
I dissent. In my opinion the third count contained in plaintiff’s complaint stated a cause of action, based on a direct promise to pay, and this is abundantly supported by the proof. The plaintiffs relying upon the promises made by the bank refrained from attaching Nielsen’s property, and in my opinion they should not now be defeated in their just rights. The bank represented to the plaintiffs that, if they would forbear the collection and enforcement of their indebtedness against Nielsen, the bank would pay the amount of Nielsen’s indebtedness to them from the proceeds of the sale of Nielsen’s property, real and personal, which the bank proposed to make. The bank was in possession of all the facts as to Nielsen’s property, and, having induced the plaintiffs to forbear suit against Nielsen upon positive assurance by it that the property would sell for a sum largely in excess of the amount necessary to pay the indebtedness to the bank and leave sufficient to pay the entire amount due the plaintiffs, the bank should be held to its contract.
