Myers v. Kipp

20 Pa. Super. 311 | Pa. Super. Ct. | 1902

Lead Opinion

Opinion by

Rice, P. J.,

This is an appeal from a judgment for want of a sufficient affidavit of defense in an action upon the following instrument for the payment of money: “Philadelphia, June 5, 1899. Due. D. J. Myers, trustee, eight hundred and forty-six dollars and fifty cents, payable at any time within eighteen months. To secure which I have deposited nine shares of the capital stock of the Sikes Company on which I have reserved the right to vote. Payable with interest.” The* affidavit of defense alleges, inter alia, that “your defendant was requested to give and did give the note or duebill upon which suit is brought as a memorandum note to be held by the trustee until the money advanced by DeTurck, Mcllvaine and Buck, and the indebtedness due them respectively from the Hamilton Furniture Company should be repaid in full, after which the said note was to be returned and surrendered to your defendant.”

The appellants’ counsel state the question involved in the appeal as follows : Is parol evidence admissible to show a collateral contemporaneous agreement upon the faith of which a duebill was executed; such agreement being to the effect that if a certain fund in the hands of the plaintiff, a trustee, was sufficient to pay certain parties for whom he was trustee, the duebill was not to be paid, but was to be paid only if the said fund was not sufficient to pay said parties ; to be followed by proof that the said persons had been paid from the said fund in the said plaintiff’s hands as trustee, thereby showing that the contingency has arisen upon which the duebill was not to be paid?

An affirmative answer to the foregoing question does not necessarily involve a reversal of this judgment. The proposition as stated by counsel assumes two essential facts : first, that the plaintiff, or some one having authority to speak for the parties for whom he was trustee, promised and agreed that in a certain contingency the defendant should not be required to pay the sum he admittedly received; second, that the alleged contem•poraneous agreement was the inducement for the execution of the paper, without which it would not have been signed. But the first mentioned fact is not positively and unequivocally averred in the affidavit of defense, nor is that fact, namely, that the collateral promise or agreement was made by the plaintiff or some one having authority to speak for the parties for whom he was trustee, the necessary and only possible inference that can be drawn from the facts alleged. And it is scarcely necessary to say that evidence of promises made by some other person, as, for instance, promises made by Clark alone, would not be admissible to vary the terms of the contract.

As to the second fact the affidavit is silent; that is, it does not allege that it was upon the faith of the agreement the due-bill in suit was signed. ‘“This is essential to the admission of parol evidence of an agreement to vary materially or contradict a written contract: ” Callan v. Lukens, 89 Pa. 134. Even if it be conceded that on the trial the defendant would not be permitted to testify that the oral agreement was the inducement without which the written one would not have,been signed, but that this would be for the determination of the jury from what was said and done at the time but see Commonwealth v. Julius, 173 Pa. 322, and cases there cited — it is nevertheless clear that the fact is an essential part of the defense and must be distinctly averred in an affidavit of defense. It is not sufficient to aver facts from which a jury may possibly infer it. This principle has been recognized in other pleadings : Clark v. Partridge, 2 Pa. 13, and cases there cited. See also Wodock v. Robinson, 148 Pa. 503. It applies with equal reason to affidavits of defense. “ It is too well settled to need citation of authorities that the affidavit must contain all the facts necessary to make a legal answer to the claim, and that their omission cannot be supplied by possible inference. ... It is a reasonable and salutary rule which requires that the facts relied on as a defense shall be plainly stated in the affidavit, that the court may judge of their legal effect as an answer to the claim. While technical precision in the statement of the facts is not demanded, a plain and intelligible averment is necessary: ” Class v. Kingsley, 142 Pa. 636. An affidavit of defense must be complete and explicit in setting forth the essential elements of the defense, whether legal or equitable, and there are no cases in which this rule has been or ought to be more rigidly enforced than where, in defense to an action upon an instrument for the payment of money at or within a certain time, it is alleged that there was a contemporaneous parol agreement that in a certain contingency the promisor should not be required to pay. The rule as to this class of cases, as established by the decisions, has been correctly stated as follows : But wherever a parol agreement is relied upon, the agreement and all material circumstances connected with it must be set out with great clearness and particularity, and none of the allegations required to make it effective must be left to inference : 1 P. & L. Dig. of Dec. Col. 203. “ The existence of the parol contract, and of the conditions under which it may be proved, are alike in importance ; the former can be shown only when the existence of the latter is established. And when such an agreement is alleged, the conditions that make it admissible must be set forth : ” Commonwealth Title Ins. & Trust Co. v. Folz, 19 Pa. Superior Ct. 28. We are of opinion that the affidavit is defective in both of the essentials above referred to, and therefore that the court did not commit error in entering judgment for the plaintiff, “ without prejudice to the right of the defendant to file a bill for an account.” This it seems to us preserved to the latter any equitable rights that he may have.

Judgment affirmed.

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Dissenting Opinion

Dissenting Opinion by

Smith, J.

The essential matters of defense alleged in the affidavit, briefly summarized, are the following: The defendant invested $500 in the stock of the Hamilton Furniture Company, upon a guaranty by Clark, who owned substantially the remainder, of indemnity should the investment result in a loss. The company afterward went into bankruptcy. Its assets were purchased under an arrangement wherebj- they were to be converted into cash, certain debts paid from the proceeds, and any surplus remaining paid to Clark. In carrying out this arrangement, the plaintiff, Myers, acted as trustee for the parties interested. Pending the conversion into cash, and before the sufficiency of the assets to meet the preferred claims was ascertained, Clark, through Myers, repaid to the defendant the $500 invested in the stock. Myers also advanced to the defendant the further sum of $846.50 due him for wages as an employee of the furniture company; though as to this item no defense is made beyond a credit admitted by the plaintiff. To provide against a failure to pay the preferred debts from the assets, the due bill in suit was given, with a pledge of stock as collateral. The instrument was made payable in eighteen months, a period deemed sufficient to complete the conversion of the assets into cash. Should this fund be enough to meet the preferred debts, the due bill was to be surrendered.

Were this all that is alleged in the affidavit, it would present no defense. Up to this point, the case corresponds, in substance, to that of Com. Title Ins. Co. v. Folz, referred to in the opinion of the court. Following this, however, in the present case, a feature of the defense appears which is totally absent in the case of Com. Title Ins. Co. v. Folz. The affidavit further alleges that the assets of the furniture company proved sufficient to pay the preferred debts, and to yield a surplus of more than $15,000, which had been paid, or was to be paid to Clark ; and that the due bill, therefore, pursuant to the agreement under which it was given, should be surrendered.

In strictness, this is not an allegation of a parol agreement contradicting or qualifying a written contract. It is, in effect, an allegation that payment has actually been made in accordance with a parol agreement, and that, by such payment, the written contract is discharged, and the obligation arising from it at an end. According to the affidavit, it was not an indebtedness contracted by the defendant, but a payment to Mm, provisionally, of a debt due him from Clark, the party beneficially interested in the premises, that formed the consideration of the instrument in suit; this payment being made subject to recall, if necessary, to meet the preferred debts mentioned, should the assets of the furniture company prove insufficient. The affidavit alleges that these debts have been fully paid from the assets of the furniture company; hence, that the payment to him, provisionally made, has become absolute, and that the due bill no longer represents any obligation to be performed by him. This is the plain meaning of the affidavit.

It' is unnecessary to consider the representations, promises and guaranty alleged to have been made by Clark, since , it clearly appears, from the affidavit, that he recognized his liability as guarantor, and consented to the payment of $500 to the defendant in its discharge, subject to recall should the insufficiency of the assets of the furniture company make it necessary. As to the person by whom the agreement for the surrender of the due bill was made, it is obvious that when two persons are described as contracting parties, and an agreement is alleged, this necessarily implies that such agreement was made between the contracting parties, and that any promise alleged, relative to the subject-matter of the contract, was made by one or the other of the contracting parties. Hence a promise for the benefit of the defendant, in the transaction described in the affidavit, must necessarily have been made by Myers, the other contracting party, even if this is not directly averred. As to the authority of Myers in the premises, since he had authority to pay the money to the defendant, and take, at his discretion, a security for its return if required, there is an evident presumption that he had like authority to provide, at his discretion, for the surrender of the security upon the happening of a contemplated event, viz: the payment of the preferred debts from the assets of the furniture company. Indeed, such a promise was scarcely necessary, assuming, as we must, the truth of the matters set forth; since the money paid to the defendant was really due him, and the only consideration for the due bill was the possible need of the money thus paid to meet the preferred debts should the assets prove insufficient for that purpose.

I do not regard the case as one of the class in which it must appear that the parol agreement induced the execution of the written one. It belongs rather to the class in which the enforcement of the written contract, in violation of the parol agreement, would be a fraud on the defendant. Under the circumstances set forth in the affidavit, the enforcement of the due bill would be a manifest fraud on the defendant. While recovery would not be barred by a parol agreement to the contrary, without more, the actual discharge of the obligation under the terms of such agreement, and in the manner therein provided, as described in the affidavit, would be a full defense.

The defense thus set up is of an equitable nature. Under our system of enforcing equitable rights in suits at law, an equitable defense may be maintained without resort to a court of equity. Under the plea of payment, with leave, etc., and notice of special matter pursuant to rule of court, the defendant may give in evidence any equitable defense; and, if he can make out a case on which he would be entitled to relief in equity,, he will be entitled to a verdict. It is needless to cite authority for principles so long established in our jurisprudence.

As to sufficiency with respect to form and phraseology: “ It is not necessary that an affidavit of defense should be drawn with so much nicety that no critical skill can suggest an objection ; but if it sets forth substantially a good defense it should be supported : ” Thompson v. Clark, 56 Pa. 33. In substance the affidavit before us sets forth a good defense, and in form it exhibits no material defect. It should therefore have been sustained.

I would reverse the judgment and award a procedendo.