Lapham v. Barnes

Prentiss, J.

delivered the opinion of the Court. — Whether the note, given by the plaintiff to Mr. Burr, was payment of the former debt, and created a cause of action in favor of the plaintiff, for so much money paid, laid out and expended, is the first question. By the common law, though it is otherwise in the civil law, the mere substitution of one simple contract in place of another, does not, while it remains unexecuted, operate as an extinguish-meet of the old debt; yet it seems that a promissory note, if it be received in satisfaction, will have that effect. (Barclay vs. Gooch, 2 Esp. Cas. 571, — Duke vs. Mitchell, 3 East, 251.) In Sheeby vs. Mandeville, 6 Cranch, 264, Marshall, Ch. J. said, that, although, as a general principle, a promissory note of the party, or of a third person, will not, of itself, discharge the original cause of action, yet if the note, by agreement, is received as payment, it satisfies the original contract, and the party receiving it must take his remedy upon it. The same doctrine was adopted in Wetherby vs. Mann, 11 Johns. Rep. 518,. and in Arnold vs. Camp, 12 Johns. Rep. 409. In the latter case, it was held, that a promissory note of one of two partners, given for anote against the partnership, was a discharge of the partnership note j and that the giving up of the latter to be cancelled was sufficient evidence that the former was intended and agreed to be received as payment. But the mere circumstance, that the original cause of action has been extinguished by the party, is not sufficient to entitle him to recover under a count for money paid. In Taylor vs. Higgins, 3 East, 169, it was held, that the giving of a new bond and warrant of attorney by a surety, although it was received in payment and satisfaction of the old debt, and the old bond and warrant of attorney were cancelled, could not be considered as so much money paid for the defendant’s use. In Cummings vs. Hackley, 8 Johns. Rep. 202, the question was, whether giving a bond in discharge of the liability of the plaintiff, as surety for the defendant, was to be considered as payment of money, so as to support aft action for money paid. It was determined-, that, although, as between the parties to the bond, it- might be sufficient to discharge the simple contract debt, because it was changingThe security to one of a higher nature, yet that a bond had no analogy to cash, and Was neither the actual payment -of money, nor equivalent to the payment of money» In Moore vs. Pyrke, 11 East, 52, where the plaintiff’s goods were distrained and sold for rent due from the defendant, it was held, that the money produced by the sale, and paid over to the landlord in satisfaction of the ¡rent, could not be considered the plaintiff’s money ; and, therefore, although the debt was extinguished by the seizure of the plaintiff’s goods, it was not paid by him in money, and he could not recover in an action for money paid for the defendant’s use. In Maxwell vs. Jameson, 2 Barn. & Ald. 51, where the plaintiff, being one of several makers of a promissory note, took up the note, giving his own bond for the amount, the question was, whether an action for money paid could be maintained. Bailey, J. said, that the plaintiff had paid no money; none had as yet come out of ’ his pocket, and non constat that any ever would ; for if he recovered from the defendant, still it was possible that he might never pay the money over •: when he paid the money due upon the bond, he might then have his remedy. -Abbott, J. said, that even supposing -that the plaintiff had entirely relieved the defendant from the demand against him, still the giving of a new security which extinguished the old debt, was not the same as payment. According to the reasoning in the two cases last cited, it would seem that nothing 'but the actual advancement of money will be sufficient to support the action for money paid. But it has been determined in several instances, that although the plaintiff has not actually paid money, yet if he has given what is equivalent to it, she action may be maintained» In the case of Barclay vs. Gooch, it was held, that if a party gives a promissory note for the debt of an other, which the creditor accepts in payment, it is a payment of money to the party’s use and may be recovered as such. And its Weiherby vs. Mann, it was determined that the giving of a negotiable note, if received in satisfaction of the debt, is equivalent to the payment of money,and may be considered as the payment cf money. These cases are supported on the ground, that a ¡negotiable note is the current representative of money, and may be regarded as money; and on the whole, we are inclined to think, that as as the plaintiff’s note was accepted by Mr. Burr, as payment, and the old debt was thereby satisfied, it may be considered the same as if so much money had been paid by the plaintiff, and will support the action for money paid.

The next question is, whether the payment made by the plain-is to be considered as so much money paid by him for the use both defendants, and this action, which is a joint action against both, can be maintained. If both defendants had been principals in the note to Mr. Burr, and the debt had been the proper joint debt of both of them, there could be no question but that the action might be maintained, although the plaintiff paid the debt at the request of one of them only; for in such case the request of one would operate as the request of both, and as the money would be paid for the use of both, the law would imply a promise on the part of both to repay it. But from what appears in the case, it must be taken, we think, that the debt was the proper debt of Barnes, and that Hitt was in fact a mere surety and considered in this view, if the plaintiff had not been a party to the note, and recognized as such by Hitt, but had paid the debt, being a stranger to the note, at the request of Barnes, the principal, it would seem, that the payment must be deemed to have been made for the separate use of Barnes, and not for the joint use of him and Hitt. In such case, the payment of the plaintiff would have the same effect, as it respects Hitt, as ifit had been made by Barnes himself, whose duty it was to pay the debt, and the plaintiff’s remedy would be against Barnes alone. In the case of Exall vs. Partridge et al. 8 T. R. 308, cited by the plaintiff’s counsel, the defendants were joint lessees of certain premises, and covenanted to pay the rent. Two of the defendants had assigned their interest in the premises to the third, and subsequent to the assignment, the plaintiff, with knowledge of that fact, put his-goods on the premises, where they were taken as a distress for rent ar-rear ; and the plaintiff in order to redeem his goods, which had been thus wrongfully taken, was obliged to pay the rent. It was held, that the plaintiff, under the circumstances of the case, might maintain an action for money paid against the three defendants. It is to be observed that the plaintiff was compelled to pay the-rent, under the coercion of a distress made on all the defendants jointly, and in consequence of their neglect to discharge a debt for which they were all jointly liable ; and the case was decided on the special ground, that the payment by the plaintiff was not a voluntary but a compulsory payment, which he was obliged to make in order to redeem his goods. Lawrence, J. admitted, that the justice of the case was, that the party, who was ultimately liable to pay the money, should be answerable to the plaintiff; and it is very apparent, that if the payment had been made at the request of the party who was ultimately liable, and without any distress of the plaintiff’s goods, the decision would have been that the action could nut be supported. In Elmendorf vs. Tappan et al. 5 Johns, Rep. 176, three of the defendants were principals, and the fourth a surety, on a bond given to the United States for duties, and the plaintiff, at the request of one of the principals, paid the bond, and .brought assumpsit for money paid against the principals and surety ; and it was held, that the action could not be maintained. Kent, Ch. J. said, that although a request by one of the debtors might well enure as the request of all who were concerned in interest, and were ultimately responsible to each other for the payment of a ratable proportion of the debt, yet this ought not to be extended to the surety ; that if the defendant, who made the request to the plaintiff, had himself paid off the bond, he never could have called upon the surety to contribute ; that when 'the bond was once discharged, the surety had no further concern or interest in the transaction ; and a payment, at the request of one of the obligors, •ought not to have a greater operation than an actual payment by that one.

It was insisted in the argument, that the indenture, executed in July, 1824, between the defendants and certain other persons, furnished conclusive evidence that Hitt was a principal in the note to Mr. Burr, and that the debt was the proper joint debt of him and Barnes. The object of the indenture appears to have been the assignment of certain property of Barnes to trustees, for the payment ofdebts for which Hitt and certain other persons, parties to the indenture, were liable for him ; and it was very natural and proper to describe the debts, and the amount, for which the parties, for whose benefit the indenture was made, were respectively holden. Accordingly, the indenture describes the note to Mr. Burr ; and after stating its amount to be $300, and that it was signed by the defendants and the plaintiff, it adds, “ of which the said Hitt is holden to pay ‡ 150.” These words do by no means import that the debt was the proper joint debt of the defendants, or at all preclude the idea of Hitt’s being a mere suretjr. The words are not that he is to pay, but is holden to pay, $150, and may, as we think, well admit of the construction, that he was liable or holden as surety to that amount. The note being also signed by the plaintiff, it was considered that the plaintiff was hol-den for the other moiety of ' the debt; and as Hitt would consequently be ultimately liable for $150 only, it was the intention to provide him with security to that amount. This is evident from the indenture itself, as well as from the testimony given in the case. ,

But the payment by the plaintiff was not a payment, made at the request of Barnes, by a mere stranger to the note. The plaintifF had previously become a party to the note, and paid the dehl in consequence of the obligation he had thus incurred. On the face of the note, he and the defendants were originally joint prom-issorsJand parties in the same engagement; and from the face of the note, the inference would be that each ivas responsible, as amongst themselves, for a ratable proportion of the debt. But it was competent for the plaintiff and equally so for Hitt, to repel this inference, by shewing, as they have done, the circumstances under which they became parties to the note. Although the plaintiff signed the note, after its execution and delivery by Barnes and Hitt, yet by thus making himselí a party to the note, and becoming a joint promissor with them, at the request of Barnes, he may be considered as intending to bind himself as a surety upon the note, for Barnes, originally with Hitt. This view of the ease, as against Hitt, is the most favorable that can be taken for the plaintiff; and his right to claim to stand in that relation appears to be supported by the indenture.. That, as well as other evidence in the case, shews, that Hitt recognized the plaintiff, not, however, as a guarantor of the note, but as a co-surety with him for Barnes, and that he considered himself and theplaintiá as'sureties, jointly responsible for the debt.’ Viewed in this light, they stood in equali jure, and the plaintiff would be entitled to a remedy against Hxitt to recover his aliquot proportion of the money advanced in payment of the debt. But, then, the plaintiff, if he would seek a contribution from Hitt, must sue him alone, and cannot maintain a joint action against him and the principal. This action, therefore, cannot be supported ; and, according to the agreement of the parties, the judgment of the county court must be reversed and a nonsuit entered.

Royce and Hodges, for defendant. Bennett, for plaintiff.

Judgment accordingly.

Case Details

Case Name: Lapham v. Barnes

Court Name: Supreme Court of Vermont

Date Published: Feb 15, 1828

Citation: 2 Vt. 213

Court Abbreviation: Vt.