202 N.W. 448 | Minn. | 1925
Appellant proved the execution of the note, introduced it in evidence and rested. Evidence tending to substantiate the allegations of the answer was received and contradictory evidence in rebuttal. Appellant then moved for a directed verdict for the face of the note, the unpaid interest, and $150 attorney's fees. The motion was denied and the jury returned a verdict in respondent's favor.
Other attorneys were substituted for those who tried the case for appellant and they moved in the alternative for judgment or a new trial and prosecute this appeal from an order denying the motion.
The vital question is whether the trial court erred in receiving evidence of declarations made by appellant when the note was executed, and before and after, to the effect that the money represented by the note was given to and accepted by appellant's son as an advancement.
1. A good definition of an advancement is found in 18 C.J. p. 911:
"In its legal sense * * * an advancement is an irrevocable gift in praesenti of money or property * * * to a child by a parent to enable the donee to anticipate his inheritance to the extent of the gift."
The law of advancements was discussed in Kragnes v. Kragnes,
Although an advancement is in the nature of a gift, it differs from the ordinary gift in that, while the property or money given need not be returned or repaid, it must be accounted for by the donee upon the distribution of the estate of the donor, sections 7404-7407, G.S. 1913. Whether a particular gift was an advancement is a question to be determined by ascertaining the intention of the donor at the time the gift was made. 3 Woerner, Adm. (3d ed.) p. 1884.
2. A promise to pay interest on the sum received is a circumstance to be considered in determining whether a gift or a loan was *162
intended, but such a promise does not compel the conclusion that as to the principal sum the relation between the parties is that of debtor and creditor. Baum v. Palmer,
In Kragnes v. Kragnes, supra, the note upon which suit was brought bore interest, and part of the principal and interest for six years had been paid, nevertheless it was held that it was competent for defendant to prove that he received the principal from his father as a gift in the nature of an advancement.
3. It is an admitted fact that the makers of this note intended to pay and are bound to pay interest. To that extent at least the note expresses the true agreement of the parties. To permit respondent to testify that the note was intended to obligate her husband for the payment of interest only, nothing more being shown, would certainly trench upon the rule excluding parol evidence to vary or contradict the terms of a written instrument. Skelton v. Grimm,
Had the respondent brought suit for a reformation of the note, she would have prevailed if she established to the satisfaction of the *163
court the facts upon which she here relies as a defense. Under the code system of pleading, all distinctions between actions at law and suits in equity, and the forms thereof, have been abolished, and in any action the defendant may plead all equities in his favor existing at the time of the commencement of the action or afterwards and before the service of the answer. Sections 7673, 7756, G.S. 1913. If, under the old practice, the facts would entitle the complainant to relief in a court of chancery, he may now plead them by way of defense to an action at law. Probstfield v. Czizek,
The answer states facts sufficient to give respondent the right to a reformation of the note. There is no demand for affirmative relief, but that is unnecessary. An equity may be pleaded as a defense, that is, as an obstacle which prevents a recovery. The statute so provides and the courts so hold. Pomeroy, Code Remedies, § 29. Proof of the facts pleaded is not admitted to vary the terms of the note. It is received to show the mutual misapprehension under which the parties labored when the note was executed; to show that what erroneously purports to be their contract is not the contract they intended to make or did make.
4. The sufficiency of the answer is questioned on the ground that it fails to plead that the money represented by the note was received as an advancement. The answer is not a model of clarity, but it does state sufficient facts to furnish a basis for the defense relied upon.
5. In examining the evidence, we have kept in mind the rule of Hooper v. Vanstrum,
No doubt there was a consideration for the promise to pay interest, but none for the payment of the principal of the note, for, if the money was received as an advancement, the amount will be deducted from the son's share in the mother's estate if she dies intestate, and is not otherwise recoverable because the gift was irrevocable and there is no consideration for a promise to refund the subject of a gift.
6. The action was begun in July, 1922. At that time six months' interest was due and unpaid. Liability for the interest cannot be disputed. In ruling on appellant's motions, the trial judge said that the action was on the note and no interest could be recovered except as incidental to the recovery of the principal; that no suggestion to the contrary was made at the trial, and, therefore, the failure of the jury to find a sum due as interest is of no avail to respondent. We think this is the correct view and that the judgment which may be entered in this action will not bar a subsequent action for the recovery of interest.
The other assignments of error do not require discussion.
Order affirmed. *165