73 N.J.L. 29 | N.J. | 1905
The opinion of tire court was delivered by
This action was brought to recover the amount due upon a promissory note dated June 11th, 1903, payable to the order of the plaintiff, for $3,866.57, signed by the defendant and her husband, Christian Schepflin, who -died before the commencement of suit. The malting and delivery of the note were not disputed. The defence was that it was made without consideration moving to the defendant; that at the time of the malting thereof she was a married woman, and gave the note as surety for her husband, and that she neither directly nor indirectly obtained any money, property or other things of value, for her own use or for the benefit of her separate estate, on the faith of the note. Motions for nonsuit and for direction of a verdict in defendant’s favor were made upon grounds that properly raised the questions presently ti> be dealt with. These motions were overruled, and the learned trial justice, against objection, di
The evidence showed that tire note in suit was the last renewal of a series of notes that had been discounted by the plaintiff bank under the following circumstances: On September 16th, 1899, Mrs. Schepflin gave to her husband for his accommodation her promissory note for $2,500, payable four months after date at plaintiff’s bank. Whether the note was payable to her own order and by her endorsed before delivery to her husband, or whether it was payable to his order, does not clearly appear, and in our view makes no difference. The note was given for the purpose of enabling the husband to procure a loan from the bank for his own benefit. He endorsed it and presented it to the cashier for discount. The cashier testified that upon being applied to by the husband he explained to him that the bank could not loan the money to him, but would loan it to Mrs. Schepflin. The cashier thereupon filled out what is called in the case a “proceeds check,” handed it to Mr. Schepflin and told him that -if he would get the check signed by his wife the bank would discount the note. The check was in the following form:
“$2,500.00 New Brunswick, N. J., Sept. 19, 1899.
51.33
- 2,448.67 The Peoples National Bank pay to the order of Proceeds of Note Twenty-four hundred Forty-eight and 67/100 Dollars.”
Mrs. Schepflin signed this check, and the husband turned it over to the bank on September 21st. Whether the cashier of the bank was present at the signing of the check, or whether the husband alone was present with Mrs. Schepflin at that time, was in dispute, but in our view the difference is immaterial. Hpon the presentation- of the proceeds check,
On January 5th, 1900, Mrs. Scliepflin made another note, in like form, for the further sum of $2,500, and delivered it to her husband for his accommodation and benefit. lie applied to the bank to discount this note and again was met with a refusal unless he would first procure a proceeds cheek from his wife. A check was thereupon filled up by the cashier, dated January 4th, 1900, and reading, “The Peoples National Bank pay to Proceeds of Note Twenty-four Hundred Forty-eight and 67/100 Dollars,” and delivered to Mr. Scliepflin in order that the wife’s signature might be procured. It was procured, the cheek was returned to the bank on January 6th, and the second note was thereupon discounted, the proceeds thereof ($2,448.67) being' entered as in the former instance to- the credit of her name upon the discount-book and upon the ledger of “Sundry Accounts.” At the same time her name was debited upon this ledger with the like amount on account of the proceeds check, and the amount was carried over to the credit of the husband.
These two notes of $2,500 each were renewed from time to time thereafter, in whole or in part, the successive renewal notes being signed by Mrs. Scliepflin, endorsed by her husband and delivered to the bank. On each occasion her name seems to have been credited on the ledger with the proceeds of the renewal note and debited at the same time with the like amount, the debits being represented by the maturing notes, although these did not always agree in amount with
This series of discounts and renewals finally eventuated in the giving of the note in suit, which represented the balance at that time due to the bank.
The evidence renders it clear, beyond dispute, that unless Mrs. Schepflin can be deemed to have received the proceeds of the original discounts, she did not, either at the time of the making of the original notes, or at any other time, receive any consideration of value for her own use or for the benefit of her separate estate. She had no other banking transactions with the plaintiff, kept no funds on deposit there, drew none, and gave no checks saving the "proceeds checks” above mentioned.
Section 5 of our revised Married Woman’s act of 1874, as amended in 1895 (Pamph. L., p. 821; Gen. Stat., p. 2017), declares that any married woman shall have the right to bind herself by contract in the same manner and to the same extent 'as though she were unmarried- — "provided, that nothing herein shall enable such married woman to become an accommodation endorser, guarantor or surety, nor shall she be liable on any promise to pay the debt or answer for the default or liability of any other person; provided further, however, that if on the faith of any endorsement, contract of guaranty or suretyship, promise to pay the debt or answer for the default or liability of any other person, any married woman obtains, directly or indirectly, any money, property or other thing of value, for her own use, or for the use, benefit or advantage of her separate estate, she shall be liable thereon as though she were unmarried.”
Under the facts of the present case the second proviso has no applicancy, and the question is whether the note in suit can have legal efficacy in view of the first proviso. The validity of the note in suit manifestly depends upon the validity of the original notes for $2,500 each, dated September 16th, 1899, and January 6th, 1900. If Mrs. .Schepflin did not, in a legal sense, receive the proceeds of the discount of those
Prior to the enactment of the Negotiable Instruments law (Pamph. L. 1902, p. 583) it was held by our courts that in an action at law upon a promissory note made by two persons, one of them could not set up as a defence that he was, to the knowledge of the payee, an accommodation maker, and therefore entitled to the privileges of a surety, on. the ground that his right to the status of surety was an .equity not enforceable in the courts of common law. Anthony v. Fritts, 16 Vroom 1; Shute v. Taylor, 32 Id. 256. It'was pointed out by Chief
Even with respect to parties capable of contracting, it is well settled that the rule against varying the terms of a written instrument by parol evidence does not apply at all to evidence tending to show, as between the parties, that the contract was void for want of consideration or the like. Metlar’s Administrators v. Metler, 3 C. E. Gr. 270, 273; 4 Id. 457; Chaddock v. Vanness, 6 Vroom 517 (at pp. 520, 522); Johnson v. Ramsey, 14 Id. 279 (at p. 282); Middleton v. Griffith, 28 Id. 442 (at p. 448). And this is still the case under the Negotiable Instruments act of 1902. Pamph L., p. 583, §§ 16, 24, 28, 29, 68, 196.
The fundamental inquiry, therefore, upon which the present case turns is whether the loans resulting from the discount of the two notes of $2,500 each, were made to Mrs. Sehepflin or to her husband; and this is a question of substance, not of form. So treating it, in our opinion, the question admits of but one answer. In each instance (for the evidence renders • it clear that the circumstances of the two transactions were indistinguishable), while the cashier of the bank professed an
The present case is thus clearly distinguishable from those cases in which it has been held that if the loan is made in fact to the wife she is a principal debtor and not a surety, although it be her purpose at the time to afterwards lend the money to her husband and she proceeds to carry out that purpose when she is placed in control of the fund. Such were the cases of First National Bank of Elizabeth v. Craig, 1 N. J. L. J. 153, where the note in suit was discounted for the wife, tire proceeds placed to her credit on the books of the bank and in her own bank-book, and she drew them after-wards by her own checks, payable to her husband’s order; Todd v. Bailey, 29 Vroom 10, where there was evidence (believed by the jury) showing plainly that the loan was made to the wife, and the trial judge instructed the jury that if
In those cases the wife, at the time of the discount, became the actual recipient of the money or its equivalent, which thereupon became her separate property and subject to her own disposition by virtue of the Married Woman’s act. In the ease before us there was no instant of time during which the defendant had possession or control of the proceeds of the discounts. The loans were not made, nor was any credit entered in her name at the bank, until after the "proceeds checks” had been lodged with the cashier. In form — in fiction — those checks operated to assign in advance the proceeds of a loan made to her; in substance and in fact they prevented, as they were intended to prevent, the loan from reaching her.
To attribute any binding force to her promissory notes given under such circumstances would be running counter not only to the spirit but to the letter of section 5 of the Married Woman’s act.
It may be suggested that if a married woman is to be permitted,-as in the cases just cited, to lend to her husband, or
The original note in question here, and most of the renewals, were given prior to the Negotiable Instruments act of 1902. The note in suit was given after the passage of that act. In our view, this makes no difference. This statute gives no validity to the contract of a married woman made by way of suretyship or promise to pay the debt of another person.
It follows that the learned trial justice erred in refusing defendant’s motions for nonsuit and for direction of a verdict, and the rule to show cause should be made absoluto.