Johnson v. McIntosh

| N.Y. Sup. Ct. | Apr 6, 1859

Pratt, J.

I do not think that the objection to the exams ination of the defendant McIntosh, as a witness on his own behalf, was well taken. The provision of the 399th section of the code, that a party shall not be examined as a witness unless the adverse party or person in interest is living, does not exclude a party from being a witness when the opposite party is a corporation.

1st. The general rule is in favor of admission. The cases of exclusion are exceptions. To exclude, therefore, a party to a suit from the privilege of testifying in his own behalf, it must appear, that the opposite party or person in interest is dead, or that the opposite party is an assignee, administrator, executor or legal representative of a deceased person. A cor-* poration is neither of these. For while it cannot be said to be alive in the sense applied to natural persons, it cannot be said to be dead. It clearly has an existence. This restrict-; ing clause, therefore, cannot be applied to corporations.

2d. As corporations must necessarily act through living agencies, the reasons upon which this restriction was based do not apply to them, especially so long as the agents through whom the contract in controversy was made are alive. They would be proper and competent witnesses, and the considerations, therefore, which would exclude a party in the case of the death of the other party to the transaction, do not apply at all to the case of a corporation. s

Indeed it has often, under the common law rule, been felt as a hardship, that the officers and agents of corporations who manifested all the feelings and interest of parties to the record should be allowed to testify and give their own version of the transaction, while the mouth of the other party, with no more apparent feeling and interest, should be closed in silence. The authors of the code manifestly did not design to perpetuate this evil.

But upon the other points in the case, I think there should be a new trial. The complaint sets out the execution of the note by one Barker, the indorsement by the defendant, delivery to the bank, and demand and notice. The answer, which formed the issue upon which the action was tried, admits all these averments, and alleges circumstances under which the indorsement was made, showing a sufficient consideration, but sets up as a defense a contemporaneous parol agreement by which the defendant was not to be made liable upon his indorsement, unless he should realize a certain amount from a chattel mortgage given by Barker to him, to secure him against his liability upon the indorsement. In other words, the defense set up in the answer was a parol stipulation, contemporaneous with the indorsement, that the latter should not create the liability which it purported upon its face to create, but that it was to take effect as an indorsement upon a certain condition which had not been performed. It is not necessary to cite authorities to show that contemporaneous parol stipulations, contradicting or varying the legal effect of written contract^, cannot be received in evidence. The answer, therefore, showed no defense to the complaint.

But the defendant upon the trial claimed, and so the referee has found-, that there was in fact no consideration for the indorsement by the defendant; that the defendant in the whole transaction acted as the agent of the bank, and therefore indorsed the note merely to transfer the legal title to the bank. This, if true, was undoubtedly a good defense to the action, but was it proper to be admitted under the pleadings P It was clearly not within the issue presented by the pleadings. And it was not a mere variance in some particular, but in the entire scope and meaning of the defense. If the objection had been interposed to the evidence as it was offered, the referee, if he thought it not within the issue, might undoubtedly have allowed an amendment of the answer upon such terms as he deemed proper. But on the other hand, if the trial had proceeded upon the amended answer, the plaintiff, for aught is known, might have called the cashier and other witnesses to disprove this defense. But no amendment was asked for, or made. The parties on both sides seemed to consent that all objections to the evidence might be reserved to be made at the close of the trial. The objection to this defense was then made on the part of the plaintiff. No suggestion, in regard to an amendment of the answer was made on behalf of the defendant. It seems to me, therefore, that the question presented is this, and this alone—was the objection a valid one upon the pleadings as they then stood ? As I have already suggested, it is not a variance merely in some particular, but it is an entire change of the defense, and was therefore, upon the issue as it then was, clearly incompetent. The defense set up was unproved, not in some particular, but in its entire scope and meaning. And the consideration that if the answer set up had been proved it would have constituted no defense, cannot make the case any better for the defendant.

Nor is the case cleared of the difficulty by the subsequent order giving leave to amend the answer. That order was probably granted upon the assumption that the rulings of the referee were correct. And if the judgment be allowed to stand, the order was clearly proper. And this brings us right back to the question, whether the ruling of the referee was right or not. If wrong, it surely should not be deemed cured by the order allowing the amendment. It would be exceedingly dangerous to allow a party not only to prove a defense upon the trial which was not hinted at in his answer, but to contradict facts which he had admitted by his pleadings, and then, after a verdict or decision of the referee in his favor, to allow him to make a new answer to suit the proof. This would be carrying the privilege of amendment a little too far.

The order was therefore also erroneous and should be reversed, without prejudice to the right of the defendant to move to amend his answer.

Upon the whole, I think the exceptions to the report of the referee well taken, and that the judgment should be reversed.

[Onondaga General Term, April 6, 1859.

W. F. Allen and Mullin, Justices, concurred.

Bacon, J. dissented.

Pratt, Bacon, W. F. Allen and Mullin, Justices.]