107 P.2d 790 | Kan. | 1940
The opinion of the court was delivered by
On October 16, 1937, plaintiffs commenced an action to recover on a promissory note signed by each of the four defendants, dated June 1, 1932, due December 1, 1932, for the principal amount of $4,190. Defendants filed a very long answer made up of ten divisions, which we summarize:
(1) Admits execution of the note and denies liability.
(2) The defendants, except Wilbur Sink, allege they are sureties, and they signed the note on Wilbur Sink’s representation he was indebted to plaintiffs; that Wilbur Sink was not so indebted and there was no consideration for the note.
(3)That in June, 1919, Wilbur Sink purchased from plaintiffs a motor-cultivator manufactured by Avery Company and in consideration gave plaintiffs his note dated June 23, 1919, for $850; that the machine was unsatisfactory, etc., and on September 25, 1920, the
(4) That plaintiffs were authorized dealers and agents of Avery Company.
(5) That on September 25, 1920, and prior to the signing of the contract for the second machine, Wilbur Sink expressed a doubt the second machine would be any better than the first; that plaintiffs stated to him he had not only the guarantee of the Avery Company but of the plaintiffs, and that if Wilbur Sink would sign the order if the machine did not perform as represented, plaintiffs would see that he was not called on to pay the original purchase price and that he would be given credit upon the note for the first machine and all interest he had paid and the $100 difference he had paid as well as for parts used on the first machine; that such representations were oral, he relied upon them and signed the order to the Avery Company; that later he tried the machine and it would not perform, he tendered return and was induced to keep it upon the promises and representations previously set out.
(6) That thereafter and on numerous occasions he offered to return the machine and on each occasion he was told to keep it, and if a satisfactory adjustment was not made by Avery Company plaintiffs would adjust the matter by credits in the manner heretofore mentioned, and Wilbur Sink would never be required to pay anything.
(7) That in October, 1919, Wilbur Sink was indebted to plaintiffs on three notes in no way connected with the motor-cultivator mat
(8) That during the month of June, 1920, plaintiff held his note for $4,500 and he paid thereon the sum of $1,000, for which he was not given credit and that he did not discover such failure until after plaintiffs commenced this action; that had proper credit been given for the payment of $1,000, the amount due and owing on October 6, 1924, after the payment of the $2,000, would have been considerably less than the purchase price of the first motor-cultivator, the cost of parts, interest thereon, plus the sum of $100 paid on the exchange, and that after payment of the $2,000 on September 6, 1924, he was not indebted to plaintiffs in any amount.
(9) That Wilbur Sink executed several renewals of the purported indebtedness under the mistaken belief he was indebted to plaintiffs in some amount, and that the renewal notes were wholly without consideration; that all of the renewal notes were made under mutual mistake of fact, all parties believing there was some amount due
(10) That the note sued on represents the amount of $2,643, being the indebtedness apparently due October 6, 1924, together with accrued interest; that the renewal notes were wholly without consideration and were executed by all of the defendants under the mistaken belief there was some amount due to plaintiffs. The prayer of the answer was that the plaintiffs take nothing and that defendants go hence without day.
The contract or order referred to in the answer was dated September 25, 1920, was signed by Wilbur Sink, and directed Avery Company to ship him a described motor-cultivator, in consideration of which he was to pay the company $100 and deliver a described cultivator to Mankato, Kan. It was provided no dealer or representative of the Avery Company was authorized to change the warranty. The warranty on the motor-cultivator was that it was well made, of good material, and any piece or part that proved defective within thirty days would be made good. Under head of representations, pulling power of tractors was specified, and it was provided that if within six days from the first starting the purchaser was not satisfied that the tractor could be made to operate and do the work, the purchaser agreed to notify the company by registered mail or telegram addressed to the company at Peoria, Ill., etc., as provided, and that failure to give such notice should be a waiver by the purchaser of all right under the representations, and use of the machinery after six days, etc., should be deemed proof that the same was in all respects as represented.
The plaintiffs’ reply was a denial of new matter, and allegations that defendants were barred, estopped and precluded by ratification, novation, waiver, acquiescence, estoppel and laches from questioning the note sued on or the indebtedness represented by it, and that the several oral agreements and claims of damage exhibited in the amended answer were barred by the statute of limitations.
At the beginning of the trial, the plaintiffs filed a motion to compel defendants to elect whether they relied on the oral promise alleged in part 3 of their answer, or on the oral promise alleged in part 5, or on the oral promise alleged in part 6, or on oral promises in other parts, and whether they relied on rescission or breach of warranty. The motion was denied.
It was shown that about the last date the note was delivered to Wilbur Sink, who kept it for a time, then gave it to his mother, the joint-maker, and Wilbur Sink stated he didn’t see it again “until this trial came up,” when he discovered he didn’t get credit for $1,000 which he had paid. There is some confusion as to exact dates, but his explanation was that on June 10,1920, he gave plaintiffs his two checks for $800 and for $27.75, and out of the same interest on the $4,500 note was deducted, the balance of $616.69 being credited on the principal; that on June 29,1920, he paid $1,000 and directed it be applied on the note; that the $1,000 was made up of two checks of $500 each delivered to him by other parties and by him endorsed and delivered to plaintiffs, and that he had been given no credit therefor. Plaintiff’s evidence admitted receipt of the various checks, but explained their application to other debts and
After both sides had rested, plaintiffs moved the court to withdraw from the consideration of the jury all issues concerning the motor-cultivator sale, assigning among other reasons that the defendants’ evidence showed only an oral guaranty by plaintiffs to defendant Wilbur Sink which was unenforceable because of the statute of frauds, and to withdraw the matter of the $1,000 payment on the $4,500 note for the reason the defendant Wilbur Sink was precluded by his laches. This motion was denied, as was plaintiffs’ request for instructions to the jury.
The court submitted the matter to the jury under voluminous instructions which need not be reviewed. The jury returned a general verdict:
“We, the jury, empaneled and sworn in the above-entitled ease, do upon our oaths find for the defendants, Wilbur Sink, Emit Sink, John Sink and Bert Sink. (That at the time of October 6, 1924, the defendants owed the plaintiffs nothing.)”
Originally, the court submitted eleven special questions. When the verdict and answers were returned, plaintiffs requested a direct answer to question 1. The court then submitted what appears as question 12. A similar motion was made to its answer and the court thereupon submitted what appears as question 13. We omit
“1. Who sold the motor-cultivator to Wilbur Sink on September 25, 1920? A. The motor-cultivator placed with Wilbur Sink on September 25, 1920, was the adjustment asked for Wilbur Sink by the McCarthy Hardware Company with the first motor-cultivator and $100 as a consideration.
“2. Did the Avery Company warrant this machine to Wilbur Sink? A. Yes.
“3. Was the machine sold to Wilbur Sink on September 25, 1920, warranted by McCarthy Hardware Company? A. The machine placed with Wilbur Sink on September 25, 1920, was warranted by the McCarthy Hardware Company.
“4. If you answer Question No. 3 ‘Yes,’ then state fully, (a) The terms of the warranty. A. The plaintiffs warranted the motor-cultivator to Wilbur Sink to perform the work it was designated to do. If it failed in any respect, the plaintiffs would credit all money and interest involved if the Avery Company did not. (b) What was the consideration, if any, for Wilbur Sink signing such contract? A. The consideration that induced Wilbur Sink to sign said contract was the oral warranty of the McCarthy Hardware Company.
“5. Was the $1,000 paid plaintiffs by Wilbur Sink in June, 1920, applied by plaintiffs as follows: To the principal of his $4,500 note, $616.69; to interest thereon in the sum of $198.50; and to his book account in the sum of $184.81? A. No.
“6. Did the Hardware Company orally promise Wilbur Sink on September 25, 1920, that it would make the second motor-cultivator good? A. Yes.
“7. If you answer Question No. 6, ‘Yes/ then state whether such promise was made before or after Wilbur Sink signed the written order for the second motor-cultivator. A. Before.
“8. If you answer Question No. 6, ‘Yes/ then state fully what was the consideration for such oral promise. A. The consideration given for such oral promise was the signing of the order for the second motor-cultivator by Wilbur Sink in acceptance of the adjustment offered by the Avery Company, which adjustment was asked for by the McCarthy Hardware Company.
“9. Do you find that at the time Wilbur Sink gave the three notes to the Hardware Company in 1930, he did so upon the promise that the Hardware Company would make an adjustment of his indebtedness? A. Yes.
“10. Did Wilbur Sink before he signed the order to the Avery Company on September 25, 1920, tell M. E. McCarthy that he could not see any difference between the second motor-cultivator except that it was a little narrower in width and that he did not think it would do his work, or words to that effect? A. Yes.
“11. Were the three notes, defendants’ exhibits 10 A, B and C, given to George Brosius, a collector of The McCarthy Hardware Company? A. No.
“12. Who sold the motor-cultivator to Wilbur Sink on September 25, 1920? This question refers to the Avery Company and the The McCarthy Hardware Company. A. The motor-cultivator sold to Wilbur Sink on September 25, 1920, was the adjustment asked of the Avery Company for Wilbur Sink by the McCarthy Hardware Company with the first motor-cultivator and $100 as a consideration.
*667 “13. Who made the cultivator deal with Wilbur Sink on September 25, 1920? A. The McCarthy Hardware Company, the Avery agent.”
In due time the plaintiffs filed motions to set aside answers to special questions, to set aside the verdict and for judgment for plaintiffs and for a new trial. These various motions were denied and plaintiffs appeal, specifying error in many particulars. •
In a preliminary way, it may be said that execution of the note sued on is admitted and that there is no dispute it represents the last of a series of notes covering an indebtedness made up of many items other than for the motor-cultivator purchased in September, 1920. The defense to the note is two-fold, that a certain payment of $1,000 claimed to have been made in June, 1920, was not credited on the then current note of $4,500, and that by reason of certain agreements claimed to have been made in connection with the purchase of a motor-cultivator in September, 1920, there was no liability for a part of the note, and by reason of both there was no consideration for the current note of $2,643 made October 6, 1924, nor for any note subsequently made.
We shall first consider the contention of the appellants the trial court erred in not withdrawing from the consideration of the jury all issues concerning the $1,000 payment alleged to have been made by Wilbur Sink and not credited on the then current note, our attention being confined solely to the testimony of the defendants. On January 10, 1920, Wilbur Sink and Jennie Sink delivered to plaintiffs their note for $4,500. On June 10, 1920, Wilbur Sink testified he delivered to plaintiffs two checks for $800 and $27.75 out of which interest was paid, the balance of $616.69 being credited on the note, and that on June 29, 1920, he paid by delivering to plaintiffs two checks for the further sum of $1,000 for which he received no credit. Assuming correctness of this, the following January he owed principal of $2,883.31, plus not to exceed six months’ interest at ten percent, amounting to $144.16, or a total of $3,027.47. Under date of January 15, 1921, he gave a new note to plaintiffs for $4,936.58, the consideration of which he states was the balance due on the old note, plus a book account of $883.10. The total of these last two items was $3,910.57, or over $1,000 less than the new note. At the time the new note was given, the old note bearing the endorsement of interest paid to June 29, 1920, and the credit of $616.69 and of no other amount, and marked across its face “Paid 1/17/1921,” was returned to him. He made no con
We next consider the matter of that part of the indebtedness evidenced by the note said to have arisen out of the purchase of a motor-cultivator. It is conceded by all parties that Wilbur Sink purchased a machine from the Avery Company in June, 1919, and that to pay for it he gave his note to plaintiffs for $850 and that note was later merged in the larger note of $6,06.6.85 and succeeding renewals thereof. It is admitted by Wilbur Sink that in September, 1920, he settled all matters of controversy respecting the first motor-cultivator and whether it was as represented by his entering into
“In any case founded on contract when ... an acknowledgment of an existing liability, debt or claim, or any promise to pay the same shall have been made, an action may be brought in such case within the period prescribed for the same, after such . . . acknowledgment or promise; but such acknowledgment or promise must be in writing, signed by the party to be charged thereby.”
During the course of the trial, plaintiffs made many objections to defendants’ evidence on the theory that their defenses were barred by the statute of limitations. At those times defendants insisted the matters being urged by them were in the nature of pure defenses and not counterclaims or setoffs. The trial court had not compelled them to elect whether they stood on one or several alleged oral promises, whether they were affirming the contract for the purchase of the motor-cultivator and seeking damages or whether they were attempting to have that contract set aside for fraud. As has been pointed out, the jury by its answers to special questions resolved the conflicts and found Wilbur Sink purchased the machine. It was undisputed his purchase from the Avery Company was under written warranty, and the jury found that plaintiff’s obligation was that if the machine did not perform the work it was designed to do and if Avery Company did not credit all money involved, plaintiffs would. There was no evidence and no finding of fraud. Nor was there any evidence that Wilbur Sink ever made any demand on Avery Company either under his written contract or otherwise. The evidence did show that the note for the first tractor was merged with other indebtedness of Wilbur Sink and Jennie Sink in a note given over nine months before the second motor-cultivator transaction, and that the second transaction was in full settlement of any disputes concerning the first machine. The second transaction had no connection with the giving of any note and was not coincident with any note.
In Muckenthaler v. Noller, 104 Kan. 551, 180 Pac. 453, suit was brought by plaintiffs to enforce contribution from defendants on a note signed by plaintiffs and defendants and which plaintiffs had been compelled to pay. The trial court held that the defense that defendants’ signatures were procured by fraud was barred by the statute of limitations. On appeal, this court reviewed our authorities and, notwithstanding a vigorous dissent by Burch, J., held:
“Statutes of limitation are not applicable to mere defenses.” (Syl. 1Í 3.)
“Section 24 of the code of civil procedure, which declares that, ‘When a right of action is barred by the provisions of any statute, it shall be unavailable either as a cause of action or ground of defense,’ is construed to mean that a barred right of action cannot be used as a setoff, or counterclaim, or for the purpose of obtaining affirmative relief, but not to apply to matters of pure defense.” (Syl. If 4.)
In the cases where the rule stated was applied, the defensive matter was connected with and grew out of the same transaction or matter which formed the basis of the plaintiff’s claim.
The question is whether the failure of the plaintiffs to perform the contract the jury found they made on September 25, 1920, was a pure defense to the note sued on. As has been stated, the note for the first motor-cultivator was merged with other indebtedness which at the above date was for the sum of $4,500. When the second motor-cultivator transaction was had, all matters concerning the first transaction were settled, as is alleged in the answer. The new agreement was separate and apart from the then existing note. It obligated the plaintiffs only in a secondary way; the primary obligation was that of the Avery Company. Those new obligations were no part of the note, did not grow out of the note, the note did not grow out of the transaction, and there was only an indirect connection between the two. Had the note been due on September 26, 1921, and an action then been brought upon it, the transaction of the day before would not have been a defense. Was the situation altered because later the motor-cultivator did not stand up to the primary warranty? The defendant Wilbur Sink had a distinct cause of action against the Avery Company and the plaintiffs on account of the transaction of September 25, 1921, which was separate and apart from the note. Timely begun, that cause of action might have been the basis of a counterclaim or setoff, but defendant, Wilbur Sink, permitted that cause of action to become barred by the statute of limitations, for, as has been heretofore shown, the statute was not tolled by subsequent oral promises. Under the special finding as to the agreement of September 25, 1921, the default of plaintiffs with
Other contentions discussed in the briefs do not require attention.
The judgment of the trial court is reversed, and the cause remanded with instructions to render judgment in favor of the plaintiffs and against the defendants.