PRESTON COUNTY COKE COMPANY v. PRESTON COUNTY LIGHT AND POWER COMPANY
(No. 12007)
Supreme Court of Appeals of West Virginia
Submittеd September 13, 1960. Resubmitted October 18, 1960. Decided March 28, 1961.
Dissenting Opinion April 24, 1961. Rehearing Denied May 9, 1961.
231
GIVEN, JUDGE, dissenting.
Steptoe & Johnson, James M. Guiher, Charles V. Wehner, for plaintiff in error.
Charles H. Brown, Russell L. Furbee, Daniel Gersen, New York City, for defendant in error.
HAYMOND, PRESIDENT:
This is an action of assumpsit instituted in the Circuit Court of Preston County April 22, 1958. The plaintiff, Preston County Coke Company, a corporation, herein designated as the coke company, seeks to recover from the defendant, Preston County Light and Power Company, a corporation, herein designated as the power company, the sum of $272,571.12, representing a balance of an open account between the parties which began about the year 1923 and continued until the institution of this action. This balance the plaintiff alleges the defendant owes and has refused to pay.
To the declaration, which contains three counts and with which the plaintiff filed two itemized statements of account, the defendant filed its statement of particulars of defense, its plea of nonassumpsit, its plea of the five year statute of limitations and its plea of payment; and to the plea of the statute of limitations the plaintiff filed its special replication in which it alleged that within that period the defendant in writing had acknowledged, and by a new promise had agreed to pay, its debt of $272,571.12. The defendant also asserted a claim of set-off consisting of three items aggregating approximately $26,000.00 against the plaintiff.
The plaintiff was incorporated in 1907 and since shortly after its inception it has owned and operated a plant for the manufacture and sale of electricity and, until recently, coal and coke producing facilities in Preston County.
The defendant was incorporated in November 1923 and it acquired the ownership of an electric distribution system in Preston County by which it sells and distributes to the public generally electricity which it has, since its inception, purchased from the plaintiff.
The account here in suit which has been active and continuous during a period of approximately thirty-five years before the institution of this action has resulted mainly from transactions involving the sale and purchase of electricity, although the plaintiff from time to time has furnished coal and coke and various other materials to the defendant, and the defendant, which also owns and оperates a telephone system and an appliance store in Preston County, has furnished telephone service, electrical materials and supplies, and labor to the plaintiff. During a part of the period of the existence of the present account, in making its partial payments, the defendant deducted the amount of its invoices from the larger invoices sent to it by
H. C. Greer controlled the management and the policies оf each company from its inception until his death in 1948. The plaintiff and the defendant have always maintained separate offices, have kept separate books and bank accounts, and have made separate tax returns; and during most of the time each has had a separate bookkeeper. The office of the plaintiff has been located at Cascade and the office of the defendant has been located at Masontown, in Preston County. The distance between the two offices is about one mile. Until sometime in 1955 the same persons were officers in both companies.
After Greer‘s death, his widow, Mrs. H. C. Greer owned a majority of the stock in the coke company and during 1951 her daughter, then Jane Raese, now Jane Kelly, obtained control of the power company. On May 3, 1955 Jane and her then husband Dyke Raese were divorced and on May 6, 1955, she married H. B. Kelly in Florida. Several days later Raese resigned as president and director of the power company and on August
A. W. Hawley, who was first employed by the plaintiff in 1908, has bеen its president since 1948 although he has not been active in its management after his retirement from his duties in 1953. He was also vice president of the power company from 1923 until the early part of 1954. From January 1939 through January 1950 all entries in the ledger sheets of the plaintiff relating to its account with the defendant were in his handwriting and until April 1953 all checks issued by the defendant for payments to the plaintiff were signed by him as its vice president. H. W. Moore, who has been general manager and treasurer of the plaintiff since January 1, 1953, has been in charge of its office at Cascade and has had supervision of the work of its bookkeeper, Howard Burge; and from April 1953 until September 1955 Moore was authorized to sign and signed all checks issued by the defendant for payments on its account with the plaintiff. As the bookkeeper of the plaintiff, Burge has made the actual entries in its ledger in connection with its account with the defendant since February 1950. Until January 1953 he worked under the supervision of Hawley and, after Hawley‘s retirement, under the supervision of Moore.
Both parties concede that the amount of the balance of the account, when this action was instituted, was $272,571.12 and that no part of that amount has been paid to the plaintiff by the defendant.
In June 1954 Burge, the bookkeeper of the plaintiff, at the office of the defendant, compared the financial records of the plaintiff and the defendant with Crane, who was then the commercial manager of the defendant in charge of its books and records. At that time it was
From April 30, 1955 until the institution of this action in April 1958, the plaintiff sent to the defendant monthly statements showing the balance owed by the defendant and the copies of the balance sheets of the defendant which, after February 1957, were sent each month to the plaintiff, carried the same amount as a debt it owed to the plaintiff. Each monthly statement sent to the defendant by the plaintiff during the foregoing period showed a balance of $272,571.12 owed by the defendant as of the date indicated on the statement. For example the statements show the balance of $272,571.12 as of April 15, May 13, June 22, July 13, August 12, September 16 and December 31, 1955; January 27, February 21, March 19, April 27, May 16, June 15, July 18, and December 14, 1956; January 31, February 26, March 22, April 18, May 31, June 30, July 31, August 22, September 27, October 18, November 29 and December 16, 1957; and January 14, February 18 and March 18, 1958. These monthly statements also show that payments made by the defendant during the period April 30, 1955 to the time of the institution of this action in April 1958, were credited to and applied by the plaintiff against the fluctuating monthly balance owed by the defendant according to the records of the plaintiff and that when the monthly charge against the defendant for March 1958 of
In its annual verified reports to the public service commission the defendant listed as a liability to associated companies $272,571.12 as of December 31, 1957; $273,004.12 as of December 31, 1956; $283,207.39 as of December 31, 1955; $283,196.18 as of December 31, 1954; $292,098.03 as of December 31, 1953; and $291,594.04 as of December 31, 1952. These amounts represented or included the indebtedness of the defendant to the plaintiff as of the date indicated in each report. Since February 29, 1956, the indebtedness of the defendant to the plaintiff as shown by the ledger sheets of the defendant amounted to the sum of $272,571.12. The federal income tax return of the defendant for the calendar year 1957 stated that it owed the plaintiff the sum of $272,571.12. Jane Kelly testified that this balance of $272,571.12 was carried on the bоoks of the defendant and included in its report to the public service commission because her mother Mrs. H. C. Greer told her that this was necessary to avoid tax difficulties. Mrs. Greer, however, denied this testimony of her daughter.
No representative of the defendant, at any time before the institution of this action, ever questioned or denied the amount of its indebtedness to the plaintiff, or challenged the correctness of any of the statements of the plaintiff concerning the account, or complained of the amount of the balance at any given time, or objected to the manner, in which the payments made by the defendant from time to time, and of which the defendant had full knowledge, were applied to or credited against the balance as indicated by the records of the plaintiff and by the monthly statements which the plaintiff sent to the defendant. Burge saw Crane almost daily while Burge was the bookkeeper of the
According to the statements of account, designated No. 1 and No. 2, and Exhibit No. 11, identified as Schedule 1-A, filed by the plaintiff, and testimony introduced in its behalf, the amount owed by the defendant at the time of the institution of this action was the sum of $272,571.12. The amount of its indebtedness as of June 1955, after crediting all payments upon the account made by the defendant, including the payments
From April 12, 1951 to August 8, 1952, the defendant made payments by eleven checks which were signed by A. W. Hawley, then its vice president. These checks exactly corresponded in amount with the net amount of the invoices sent by the plaintiff to the defendant and charged against its account. None of these checks contained any notation or was accompanied by any invoice, memorandum or statement which indicated or directed how the amount of each check should be applied in the payment of the account. Hawley testified that in signing these checks in behalf of the defendant he did not intend that any of them should be applied to the payment of any specific invoice or portion of the account and that all of them were applied as general credits against the account. He also testified that prior to 1951 other payments made by the defendant in specific amounts had, according to the established practice, been applied as general credits against the account, that the transactions between the plaintiff and the defеndant in connection with the account were not conducted on a monthly basis, and that after the account began it continued for years before the defendant “paid anything much on the account.” His testimony as to the application of these payments is not directly controverted by any evidence introduced by the defendant and their application as general payments is reflected by the books and the financial records of both the plaintiff and the defendant.
During the five year period, April 1953 to April 1958, immediately preceding the institution of this action, sixty four checks were issued by the defendant. Thirty one of these checks, issued between April 22, 1953 and August 11, 1955, were signed in behalf of the defendant by H. W. Moore as general manager. Moore
For the three months of April, May and June, 1953, however, the defendant made no payments on the account. The invoices against the defendant for those three months aggregated $26,364.75. Between May 1953 and January 1955, eight payments aggregating $20,000.00, which did not correspond in amount with the amount of any invoice issued by the plaintiff, were made by the defendant and were applied by the plaintiff as general credits against the account. The dates and the amounts of these eight payments were May 1953, $8000.00; August 1954, $2000.00; September 1954, $2000.00; October 1954, $2000.00; November 1954, $2000.00; December 1954, $2000.00; and January 1955, $2000.00. With respect to these payments Crane testified that he did not know what they were for except that the plaintiff was in the process of rebuilding its power plant and needed additional funds. The plaintiff contends that these eight payments were properly applied as general payments on the account. On the contrary the defendant insists that the aggregate of the payments of $20,000.00 together with a credit of $5060.25 to which it was entitled was in payment of the
A meeting of the directors of the defendant was held in Morgantown on December 16, 1952 which, according to the minutes, was attended by Jane Kelly, then Jane Raese, A. W. Hawley, Mrs. H. C. Greer and Dyke Raese. Raese was president of the defendant, Hawley was its vice president, Jane Kelly, then Jane Raese, was its secretary, and Mrs. Greer was its treasurer. The minutes show that the only business discussed or transacted at the meeting was the release by Mrs. Greer of notes of the defendant and certain accrued rentals in the amount of $28,989.88, which the power company owed Mrs. Greer personally. Jane Kelly testified that at that meeting Mrs. Greer told her that the plaintiff would forgive the balance of the account which the defendant owed the plaintiff and which at that time, according to the report of the defendant to the public service commission for the year 1952, was the sum of $291,497.97. She also testified that she reminded Mrs. Greer of this matter in a telephone conversation in June 1955 and again at a meeting held in Florida in May 1956. She did not state what, if anything, would accrue to the plaintiff in exchange for its action in cancelling or releasing the amount of the account. Raese, Hawley and Mrs. Greer testified positively that no such conversation or transaction relating to the account occurred in their presence at the meeting on December 16, 1952, and that they had never heard of any claim or contention made by the defendant that the account had been forgiven until after the institution of this action. McKee, who had been employed by both the plaintiff and the defendant, also testified that he was present at the Florida meeting in 1955 and that at that time, although the account was discussed, Jane Kelly did not at any time say that the account had been forgiven. The testimony of Jane Kelly concerning the forgiveness of the account was objected to by the plain-
On April 4, 1958, Moore by letter demanded payment of the account by the defendant in the amount of $272,571.12. The plaintiff received no reply to this demand and on April 22, 1958, it instituted this action to recover that amount from the defendant.
By its numerous assignments of error in the final judgment the plaintiff complains of the action of the circuit court (1) in overruling the motion of the plaintiff to set aside the verdict and grant it a new trial and in entering judgment in favor of the plaintiff for the sum of $1304.43 instead of the sum of $272,571.12; (2) in overruling the motion of the plaintiff, at the conclusion of the evidence, for a directed verdict in its favor for $272,571.12; (3) in refusing to give to the jury certain instructions offered, and a special interrogatory submitted, by the plaintiff; (4) in modifying, over the objection of the plaintiff, Instruction No. 6 offered by the plaintiff and in giving that instruction in its modified form; (5) in giving to the jury, over the objection of the plaintiff, certain instructions offered by the defendant; (6) in overruling the motion of the plaintiff to strike from the record all the testimony of Jane Kelly relating to forgiveness or release of the account which the plaintiff alleges the defendant owes the plaintiff in the amount of $272,571.12; (7) in excluding, over the objection of the plaintiff, certain evidence offered by it during the trial of the action; and (8) in admitting, over the objection of the plaintiff, certain evidence offered by the defendant during the trial of the action.
After the case was originally argued in this Court, it was reargued at the direction of this Court, particularly with respect to the controlling question whether the account asserted by the plaintiff or any part of it was barred by the five year statute of limi-
Before considering the controlling question whether the account between the parties which was a single open and continuing account which began in 1923 and continued until, and even after, the institution of this action in April 1958, or any part of it, is barred by the statute of limitations, it is necessary to consider and dispose of several specific incidental or related contentions of the plaintiff on which it relies for reversal by this Court of the final judgment of the circuit court. These contentions are, in substance, (1) that the delivery by the defendant to the plaintiff of its monthly balance sheets, containing an express acknowledgment of the sum of $272,571.12 as a current liability which it owed to the plaintiff constituted a new promise within the meaning of
Contentions 1 and 2 are unsound for the reason that the designated balаnce sheets of the defendant which show the sum of $272,571.12 as a current liability of the defendant do not constitute a written signed promise to pay the plaintiff that amount of money or an acknowledgment from which such promise may be implied. The balance sheets and the annual report do, however, constitute an admission of its existing liability to the plaintiff in a designated sum. Fayette Liquor Co. v. Jones, 75 W. Va. 119, 83 S. E. 726. The provisions of
Contention 3, relating to the alleged account stated, is not well founded because the documents on which it is based, except the annual report, likewise lack the signature of the defendant. Though there is authority for the proposition that it is not necessary that an acknowledgment of the correctness of an account, in order to constitute an account stated, should be either in writing or made in express words, Baltimore and Ohio Railroad Company v. Berkeley Springs and Potomac Railroad Comрany, 168 Fed. 770, this Court has expressly held in point 4 of the syllabus in Stiles v. Laurel Fork Oil and Coal Company, 47 W. Va. 838, 35 S. E. 986, that “A stated account, not signed by the
A promise sufficient to toll the statute of limitations should be made directly to the creditor or some person acting for him, and declarations or admissions to strangers are insufficient for that purpose. 12 Michie‘s Jurisprudence, Limitation of Actions, Section 60; Layman v. Layman, 171 Va. 317, 198 S. E. 923; Dinguid v. Schoolfield, 32 Gratt. 803, 73 Va. 803. The proof submitted by the plaintiff does not show that the annual report of the defendant to the public service commission or its 1957 income tax return was directed or delivered to the plaintiff or to any person acting for it.
This Court has held that a party who relies upon a new promise to remove the bar of the statute of limitations has the burden of proving such promise. Bank of Union v. Nickell, 57 W. Va. 57, 49 S. E. 1003; Stansbury v. Stansbury‘s Adm‘rs., 20 W. Va. 23. In Stans-bury v. Stansbury‘s Adm‘rs., 20 W. Va. 23, the opinion contains this language: “The current of modern authority establishes, that the burden of removing the statutory bar rests upon the plaintiff. * * *“. Though point 3 of the syllabus in that case states that “The burden of removing the bar of the statute of limitations by a new promise rests upon the defendants;” the word “defendants” manifestly is erroneously used for and actually means the word “plaintiffs“; for obviously a defendant who interposes the defense of the statute of limitations would not destroy such defense by attempting to establish a new promise to remove the bar of the statute on the application of which he bases that defense. The evidence in behalf of the plaintiff in this case manifestly does not satisfy or discharge the burden of proof imposed upon it on that issue.
On the decisive and controlling question whether the five year statute of limitations applies to and bars in whole or in part the demand of the plaintiff upon the open and continuous running acсount between the parties, the clear and decided preponderance of the evidence, much of which is not disputed or controverted by evidence introduced in behalf of the defendant, amply supports the contention of the plaintiff that no part of the account is barred by or subject to the application of the statute of limitations. The undisputed evidence shows that all of the payments made by the defendant from the inception of the account in 1923 until the institution of this action in April 1958 were without exception actually applied by the plaintiff, with full knowledge of and without objection by the defendant, as general credits upon the account.
Hawley, who as vice president of the defendant issued eleven checks during the period April 12, 1951 to August 8, 1952, testified positively that when he issued the checks they were not intended to be applied in payment of any specific amount and that all of them were intended to be and were actually applied as general credits against the account, and that the checks contained no notation or direction with respect to the
In addition to the testimony of these witnesses the undisputed evidence shows that the monthly statements of the plaintiff which it delivered to the defendant and the balance sheets of the defendant which it delivered to the plaintiff, at least since January 1955, carried the same balance and showed that the various payments were applied to and credited against the balance of the account which fluctuated from time to time until March 1958, at which time the balance sheet of the defendant showed the balance which it owed to the plaintiff to be $272,571.12. The undisputed evidence also shows that the income tax return filed by the defendant for the year 1957 reported the liability of the defendant to the plaintiff in the amount of $272,571.12, that the annual reports of the defendant to the public service commission for the calendar years 1957, 1956, 1955, 1954, 1953 and 1952 listed its liability to “associated companies” in the sum of $272,571.12 or in an amount in excess of that sum, and that since February 29, 1956 the ledger sheets of the defendant showed it to be indebted to the plaintiff in the sum of $272,571.12. All the evidence, except the dubious testimony of Jane
The only material evidence which in any way contradicts the above recited evidence in support of the contention of the plaintiff, or which gives rise to an inference contrary to that contention, consists of the testimony of Crane that in issuing the thirty one checks in amounts which corresponded with the amount of the monthly invoices during the period September 15, 1955 to April 16, 1958, it was his intention that the amounts of those checks should be applied to the payment of those invoices, although he admitted, in effect, that he never communicated such intention to any representative of the plaintiff, which is necessary to constitute a designation of the manner in which such payments should be applied, Stone Company v. Rich, 160 N. C. 161, 75 S. E. 1077, 1914C Ann. Cas. 247; 40 Am. Jur., Payments, Section 115; the evidence that during the period April 12, 1951 to August 8, 1952, the eleven checks issued by Hawley corresponded in amount with the invoices issued by the plaintiff during that period of time; the evidence that during the five year period April 22, 1953 to April 22, 1958, the date of the institution of this action, the sixty four checks issued by the defendant either singly or together cor
The inference in favor of the defendant arising from the foregoing evidence in its behalf, however, is weakened by the lack of evidence to show that any checks which corresponded in amount with the invoices of the plaintiff were issued by the defendant between August 8, 1952 and April 22, 1953, by the failure of the defendant to issue any checks which equalled in amount the invoices of the plaintiff for the three months of April, May and June, 1953, which aggregated the sum of $26,364.75, by the issuance by the defendant between May 1953 and January 1955 of eight checks aggregating $20,000.00 which did not correspond in amount with the amount of any invoice of the plaintiff and by the actual application by the plaintiff, with knowledge of the defendant and without objection by it, of the payments made by these checks as general credits on the account.
The defendant cites and especially relies upon the case of F. M. Slagle and Company v. Bushnell, 70 S. D. 250, 16 N. W. 2d 914, in support of its contention that the identity in the amounts of its checks and the invoices of the plaintiff constituted a direction that the amounts of the checks should be applied by the plaintiff to the payment of such invoices. The material differences in the facts in that case from the established facts in this case readily distinguish these two cases. There the account existed for a period of approximately ten years before the institution of suit; here the account continued for a period of thirty five years. There the amount of the indebtedness was disputed; here the amount of the unpaid balance is admitted. There twenty six payments ranging from $1.10 to $75.65 were made during a six year statutory period before suit was instituted. There the largest payments were one for $75.65 and another for $54.20 and all of them were represented by the personal checks of the defendant who directly testified that the checks were in payment of current items. Here there is no such direct testimony. There the evidence did not disclose whether anything was said or written in connection with the delivery of any of the checks. Here the evidence is clear and undisputed that nothing was said or written by the defendant which directed the plaintiff to credit the amounts of the checks against the identical amounts of the invoices and, unlike the factual situation in the Slagle case, the undisputed evidence in the case at bar is that the plaintiff, with full knowledge of and without objection by the defendant, actually applied the checks as general credits against the account. Other material differences between the factual situation involved in the Slagle case and the factual situation here involved appear from the opinion in that case; and these differences will readily appear from even a casual consideration of that opinion. But even if there were no differences in the material facts of that case and of this case, the decision in the Slagle case is not binding but only persuasive authority, to be accepted or rejected or given such weight by this Court as it may determine. The decision in the Slagle case is not in accord with the
As heretofore pointed out the clear and decided preponderance of all the evidence amply supports the contention of the plaintiff that no part of the account is barred by or subject to the application of the statute of limitations. For this reason the verdict of the jury cannot stand. This Court has consistently held that a verdict of a jury, which is without sufficient evidence to support it, or is plainly against the decided weight and preponderance of conflicting evidence, will on proper motion be set aside by the court. Mulroy v. Co-Operative Transit Company, 142 W. Va. 165, 95 S. E. 2d 63; Kap-Tex, Inc. v. Romans, 136 W. Va. 489, 67 S. E. 2d 847; Cannaday v. Chestonia, 106 W. Va. 254, 145 S. E. 390; Palmer v. Magers, 85 W. Va. 415, 102 S. E. 100; Griffith v. American Coal Company, 78 W. Va. 34, 88 S. E. 595; Kelley v. Aetna Insurance Company, 75 W. Va. 637, 84 S. E. 502; Sims v. Carpenter, Frazier and Company, 68 W. Va. 223, 69 S. E. 794; Coalmer v. Barrett, 61 W. Va. 237, 56 S. E. 385; Chapman v. Liverpool Salt and Coal Company, 57 W. Va. 395, 50 S. E. 601.
As previously indicated, the evidence in this case, though in some respects conflicting, embraces uncontradicted facts and circumstances which caused the case to turn in favor of the plaintiff. In numerous cases this Court has held that when the evidence, though conflicting as a whole, embraces uncontradicted facts and circumstances which cause the case to turn in favor of one of the parties so that a verdict adverse to such party can not stand, the court should direct a verdict in his favor. Mulroy v. Co-Operative Transit Company, 142 W. Va. 165, 95 S. E. 2d 63; Adkins v. Aetna Life Insurance Company, 130 W. Va. 362, 43 S. E. 2d 372; Norvell v. Kanawha and Michigan Railway Company, 67 W. Va. 467, 68 S. E. 288, 29 L.R.A., N.S., 325. See Tochek v. Monongahela Transport Company, 109 W. Va. 20, 152 S. E. 776; Smith v. Abbott, 106 W. Va. 119, 145 S. E. 596; Summit Coal Company v. Raleigh Smokeless Fuel Company, 99 W. Va. 11, 128 S. E. 298; Hicks v. New River and Pocahontas Consolidated Coal Company, 95 W. Va. 17, 120 S. E. 898. See also England v. Aetna Life Insurance Cоmpany, 285 Mich. 302, 280 N. W. 771.
Inasmuch as the circuit court, upon the evidence as a whole, refused to direct a verdict for the plaintiff for the sum of $272,571.12, it should have granted the motion of the plaintiff to set aside the verdict and award it a new trial.
In this jurisdiction and according to the weight of authority, the burden rests upon the defendant, under its plea of the statute of limitations, to establish by a preponderance of the evidence that the claim of the plaintiff is barred by the statute. Knight v. Chesapeake Coal Company, 99 W. Va. 261, 128 S. E. 318; Buck v. Newberry, 55 W. Va. 681, 47 S. E. 889; Burke, Pleading and Practice, Fourth Edition, Section 240; 34 Am. Jur., Limitation of Actions, Section 450; 54 C.J.S., Limitations of Action, Section 386. From the evidence as a whole it is clear that the defendant has failed to meet or discharge that essential legal requirement in this case.
As to the manner of the application of payments made by a debtor upon an account the debtor, at the time of making payments, has an absolute right to direct to which of his debts payments shall be applied, but if he omits to exercise such right, the creditor to whom the payments are made may apply such payments as he may choose to apply them; and if an account sued upon contains credits, either in money or other thing, such credits will be applied, in the absence of any special application by the parties themselves, to such portions of the account, if any there be, as would otherwise be barrеd by the statute of limitations. Ryan v. Casto, 76 W. Va. 314, 85 S. E. 553. In general when application of payment is made
To the contention of the plaintiff that the action of the circuit court in admitting the testimony of Jane Kelly that the account was forgiven or released by the plaintiff by virtue of a verbal statement made to her by Mrs. Greer at a meeting of the directors of the power company on December 16, 1952, and in giving an instruction to the jury based upon such testimony constituted reversible error, the defendant replies in substance that the question of forgiveness was removed from the case and that defense was abandoned by the defendant inasmuch as it did not present that question in its argument to the jury and does not rely upon that defense on this writ of error. That testimony, however, and the instruction based upon it, which, together with the other instructions, at the request of the jury, was read to it a second time by the trial judge, were not stricken or removed but remained in the case and before the jury for its consideration. If the action of the circuit court constituted error it was not corrected, as it could have been, by directing the jury to disregard the evidence and by withdrawing the instruction from the jury. The evidence was inadmissible for the reasons that the purported forgiveness or release was not authorized by any valid corporate action of the plaintiff, as clearly appears from the minutes of the meeting, and was not supported by any sufficient legal consideration. It can not be said that this testimony was not prejudicial to the plaintiff. On the contrary any statement to the effect that the account had been forgiven or released could readily induce the jury to disallow the large portion of the account which existed when the statement was made in December 1952 or to reduce the unpaid amount of the plaintiff‘s account, as it did by its verdict, to the relatively insignificant sum of
It was also error for the circuit court to give Instruction No. 6 offered by the plaintiff as modified by the circuit court relating to the alleged forgiveness or release of the account for the reason that the instruction, as modified, omitted the essential requirement that an unsealed release of an obligation to be
In view of the pronouncements in this opinion with respect to the questions specifically dealt with and
The judgment of the Circuit Court of Preston County is reversed, the verdict is set aside, and this case is remanded for a new trial which is here awarded the plaintiff.
Judgment reversed, verdict set aside, new trial awarded.
GIVEN, JUDGE, dissenting:
Being of the firm view that the controlling question, the question relating to the application of the statute of limitations, was unquestionably for jury determination, and that the experienced and learned trial judge properly submitted that question to the jury, I am forced to dissent. It is of interest to note that the majority admits that there is a conflict in the evidence, and though the majority now says that the verdict was contrary to the “clear and decided” preponderance of the evidence, it did not seem so when the re-argument was ordered, on the very same record. Moreover, in the study of the evidence, and in the decision conferences of this Court, the view of the majority members of the Court, on the very same question, was not always the same, yet the majority points out that ordinarily the question here involved is one for jury determination.
I do not doubt the power or duty of this Court to set aside a verdict which is against a clear preponderance of the evidence, but it is just as clear that every reasonable inference warranted by the evidence should be considered in support of a verdict. In other words, the jury is the proper body to weigh the evidence and draw inferences.
In considering the cogency or probative value of the evidence as to either party, it is necessary to keep in mind certain basic facts not disputed. The plaintiff‘s account of its indebtedness, filed with its declara
It should also be noted that during the five year period, the monthly charges made by defendant against the plaintiff were paid to defendant each month, to the very cent, either by check or by deduction from the larger amount owed plaintiff by the defendant. Thus, hundreds of items of charges, both as to plaintiff and defendant, to the very cent, were settled, satisfied and paid monthly. Can we believe that if there had been no such understanding as to the application of payments, as contended for by defendant, that the plaintiff would have continued to make regular monthly payments to defendant of the charges made by the defendant against plaintiff? It is also
Looking to the whole of plaintiff‘s evidence, as to its cogency and probative value as related to the particular problem, five witnesses testified in chief. Three of them gave no testimony concerning the question here involved, except as it related to the manner or method of bookkeeping. The other two, in addition to their testimony relating to the method of bookkeeping, were morе emphatic as to the intention of plaintiff to apply the monthly settlement-payments to the older part of the account. None of the witnesses, however, contended that any specific requirement or instruction to that effect was ever made by the officers of the plaintiff company, or that any such instruction existed. It is admitted by the witnesses for plain
“If we are unable to acquire control of your company and bring about a unification of management and resources, we shall be forced to choose from two alternative courses of action.” The alternatives were either that the defendant should accept the proрosal of plaintiff concerning an increase in rates or charges for power sold by it to defendant, so that plaintiff would not “be forced to proceed with collection of the $272,571.12 account receivable due from the Light & Power Company. Prompt court action of this matter is particularly desirable to the Coke Company since even in the unlikely event of an adverse decision it would have the tax advantage of an established loss while the Light & Power Company would have an empty victory and incur an income tax liability of $141,736.98; a debt which could crush that company“, or, the other alternative, “cease all expansion work“, thereby forcing defendant to purchase power from a different company at a rate considered prohibitive. Again the written statement of plaintiff recognized the $272,571.12 as an old account carried on the books of the two companies as something wholly different from the monthly settlements and payments, and also that defendant was denying liability in relation thereto.
While I believe the whole evidence of the plaintiff, considering the inferences the jury would have
In addition to the foregoing facts, especially the uniform pattern of the monthly settlement and payment for the entire five year period, and long before, other pertinent and strong testimony exists supporting the verdict of the jury. Mr. Crane, vice president of the defendant company and the only person authorized to sign checks for it, testified: “I can speak from the period from August, 1953, on in which I either made up the checks personally or gave directions to one of the girls in the office to make them up to which they were intended to pay a specific month‘s invoice, or invoices, and they were always made exactly to the penny. Q. Mr. Crane, does your answer to that question cover also the checks and invoices embraced in Defendant‘s Exhibit No. 3? A. They do.” Mr. Crane further testified positively that the sum claimed, $272,571.12, “represents an amount that had been accumulated on our books prior to the time I went with the company“, 1953, and that no “express demand” other than the one made just before institution of the action was ever made of the defendant for payment of any part of the old account.
In a letter from plaintiff to defendant dated September 16, 1955, the plaintiff said: “Your accounts are in pretty good shape now and if your collections
Honig, an experienced certified public accountant, engaged in the business since 1928, made a thorough examination of the account books of defendant and plaintiff, especially as to the claim here involved. From his testimony, not denied, it appears that during the five year period here material, the amount of the monthly invoices of defendant, plus the amount of payments to plaintiff as represented by defendant‘s cancelled checks, was “equal to the penny” to the exact amount of the payments made by defendant. He also testified as to a notation on the ledger of plaintiff in connection with the credit of the November, 1953, charge, in handwriting, saying, “paid on November account“, which unquestionably constituted a recognition by plaintiff of a monthly account, and of the payment of that monthly account. The witness further testified to the effect that such a memorandum was not necessary as to subsequent monthly payments, for the reason that, as a matter of bookkeeping, such fact “was obvious“. Also, the November, 1953, worksheet of defendant showed a “Bal due Coke Co. Nov. 3,365.30“; and a cancelled check for that exact amount was exhibited to the jury, indicating the pattern of monthly settlement and payment of monthly accounts.
Beginning long before the commencement of the five year period, at least by March, 1951, and continuing through the period in which the monthly charges made by defendant against plaintiff were deducted from the monthly charges made each month by the plaintiff against the defendant, each individual monthly statement or invoice received from plaintiff by defendant, or defendant‘s worksheet for that particular month attached to such monthly statement, was marked “paid“, with the further notation,
Mrs. Kelly testified as to various conversations with Mrs. Greer and other officers of the plaintiff company, and stated that it was her understanding that the old account was being carried on the books “and should remain on the bоoks only in some reference to some tax difficulties we would get in if it were removed * * *,, *“. She further testified that she had a conversation with the treasurer and general manager of the plaintiff company, who desired an exchange of
Mrs. Kelly also testified to the effect that Mrs. Greer agreed to release or cancel the entire old account. Though, as pointed out by the majority, there was probably lack of sufficient consideration for such cancellation, the testimony most certainly had probative value as to the reason for the carrying of the old debt on the books for so many years, without any demand for even a partial payment thereon.
In F. M. Slagle & Co. v. Bushnell, 70 S. D. 250, 16 N. W. 2d 914, a case in point factually, though the facts proved or admitted in the instant case are much stronger, it was held: “19. Evidence еstablished that payments by check in small amounts, most of which exactly matched current purchases, were intended as in payment of particular items of indebtedness and not as payment on general balance of account and that such intention was manifest to creditor so that such payments did not interrupt running of six year statute of limitations as to balance of account. 20. A person owing money under distinct contracts may apply payments to whichever debt he may choose and direction as to application of payment may be evidenced by circumstances as well as by words. 21. Payments were earmarked as specific rather than general payments on balance of account by fact that they were made by checks drawn in comparatively small odd dollar and cent amounts, and hence appropriation by debtor of such payments to particular items resulted
Being of the views indicated, I respectfully dissent. As definitely appears from the testimony of defendant, quoted above, and from undisputed facts pointed out, the verdict of the jury on which the judgment of the lower court was founded, was not only warranted but was the only verdict that could be justified.