126 Ark. 14 | Ark. | 1916
(after stating the facts). It is first insisted by counsel for appellant that there was a failure of consideration, and for that reason appellee is not entitled to recover on the note, and to have a foreclosure of the mortgage given to secure it. He bases his contention on the fact that Ditto agreed to lend him $500, and only let him have $200, and that he also agreed to organize a corporation for the purpose of selling the patented device in the territory described in the contract and that he failed to do so. The record shows that appellant knew that his note had been transferred t© appellee, and that he sought and ob-, tained a renewal of his note with the knowledge that there had not been a compliance with the contract in the' matters that he now complains of. Even if it be considered that these matters amounted to a total failure of .consideration, appellant is not entitled to defeat a recovery on this ground. In Stewart v. Simon, 111 Ark. 358, and Haglin v. Friedman, 118 Ark. 465, the court held that one who gives a note in renewal of another note with the knowledge at the time of the partial failure of the consideration for the original note is estopped from setting up the defense of failure of consideration, in an action on the renewal note. Again, it is contended that the renewal note sued on is void because section 513 of Kirby’s Digest was not complied with in its execution. The section reads as follows: “Any vendor of any patented machine, implement, substance or instrument of any kind or character whatsoever, when the said vendor of the same effects the sale of the same to any citizen of this State on a credit, and takes any character of negotiable instrument in payment of the same, the said negotiable instrument ' shall be executed on a printed form, and show upon its ' face that it was issued in consideration of a patented machine, implement, substance or instrument, as the case may be, and no person shall be considered an innocent holder of the same, though he may have given value for the same before maturity, and the -maker thereof may make defense to the collection of the same in the hands of any holder of said negotiable instrument, and all such notes not showing on their face for what they were given shall be absolutely void.” The note in question was not executed on a printed form, and did not show on its face that it was issued in consideration of a patented machine as required by the statute. This statute was intended for the protection of the citizens of the State, and makes void all notes given for patent rights or territory which are
executed in this State, and do not comply with the statute. This court has upheld the statute as a valid exercise of the police power. Woods v. Carl, 75 Ark. 328. We do not think, however, the section has any application to the facts oí the instant case. The original contract was executed at St. Louis in the State of Missouri. It was a Missouri contract. No attempt is made to show that the original note and contract was not valid under the laws of the State of Missouri. Consequently, the contract was valid under the laws of that State, and it. will be enforced and adjudicated by the courts of this State precisely as it would be adjudicated in the courts of the State of Missouri. Parsons Oil Co. v. Boyett, 44 Ark. 230; Grider v. Driver, 46 Ark. 50; Sawyer v. Dickson, 66 Ark. 77. But it is contended that the execution of the renewal note brings the case within the prohibition of section 513 of Kirby’s Digest. We do not agree with counsel in this contention. The execution of the renewal note did not constitute a new indebtedness. The time when the debt was contracted was not when the renewal note was executed, but when the original debt was made and the original note given. When a note or debt is renewed by the execution of a new note therefor, it is but an extension of the time of payment of such prior note or debt. Griffin v. Long, 96. Ark. 268. The mere renewal of a note does not, as between the original parties, affect the essential nature of the transaction represented by it. For that reason the principle is well established that, as between the maker and the payee, any defense that would be good against the original note would be equally good against a note taken in renewal without additional consideration. King v. Doane, 139 U. S. 166. By analogy, the renewal note would be valid, if the original debt and note were valid. There was no new consideration for the note Sued on, it was merely a renewal and extension of, time for the debt evidenced by the original note. It was not the making of a new contract for the sale of patent right territory, and does not fall within the prohibition of section 513 of Bur by’s Digest.
It follows that the decree must be affirmed.’