149 F. 130 | 3rd Cir. | 1906
This was a suit on a promissory note for $15,050, given by the defendant to the plaintiff for an interest in a zinc mining company. The defense set up was, first, that the note was obtained by misrepresentation, and, second, that before it became due the plaintiff agreed to cancel it. Both issues were submitted to the jury, who found for the defendant; but in response to an inquiry by the court, at the time the verdict was rendered, it was put entirely upon the second ground.
Complaint is made that there was no evidence of misrepresentation, and that it was error to let that question go to the jury; the plaintiff
The real question is whether there was any consideration for the promise to release the note, which is relied upon. The facts which bear upon this are not seriously disputed. In November, 1900, the plaintiff, having taken an option on a zinc mine in Missouri which he proposed to develop, wrote to the défendant, who was in the employ of the. Standard Oil Company at Bayonne, N. J., and had had considerable general business experience, to come out and take charge of it, offering him a salary of $7,500 per annum, where he was getting but $6,000, as well as a substantial interest in the enterprise, for which he agreed to take a three-year note, with the stock of the company which was to be formed as collateral. The relations of the parties for a number of years had been of the most -friendly and intimate character, very much, indeed, like that of father and son; the defendant, who started as a stenographer, having risen by the plaintiff’s influence to a responsible and remunerative position. Moved by a sense of personal obligation, as well as by the inducements held out to him, the defendant accordingly gave up his place in the East and assumed the management of the business. The venture, however, was not a success, and the defendant was only a short time engaged with it, at least directly. The plaintiff became involved in other matters, in which he needed his assistance, and the active management of it was therefore given up after a few months; the property being eventually sold out to other parties in December following at a heavy sacrifice. The diversion from the mining business was due to a crisis in the affairs of a cattle company at Kansas City, in which the plaintiff was.even more largely interested. A receivership was necessary to extricate it, and, the plaintiff having no confidence in those with whom he was associated, -the position was pressed upon the defendant, who assumed it in May, 1901, continuing in it up to the middle of October. The duties which devolved upon him in that connection were of the most arduous and exacting character, and, combined with the personal loss entailed by the failure of the zinc mine, the strain upon him, physically and mentally, was so great that early in July he
This sale was consummated early in December, and soon afterwards, December 17th, while plaintiff and defendant were riding together in a street car, the interview occurred at which, according to the defendant, the note was forgiven him. “You may regard this note as canceled and off the books” is the way it was put; -the plaintiff at the same time explaining that he did not surrender it, because he intended to sue certain other parties, who had got him into the enterprise, whose notes for stock he was similarly carrying, and he did not wish to prejudice this. “But your matter,” as the defendant was assured, “you may consider disposed of.” The plaintiff admits this meeting, and that the subject of the note was brought up, but denies having agreed to release it, and, on the contrary, declares that the defendant wanted him
As a mere gratuity, if that was all there was to it — the plaintiff not wishing the defendant to be at a loss, as he expressed it, in the earlier offers — the promise to release would not be enforceable; the gift not having been completed by a surrender. The same is true, also, if the stock which was pledged for the note and was demonstrably worthless, was to be taken and the note canceled, which would be merely another way of putting it. Neither was anything done or omitted by the defendant at the time, so as to, furnish an inducement directly moving between the parties, although that is not essential; a past transaction being sufficient, provided it actually enters into the bargain. A consideration, however, is claimed to be found in the services rendered by the defendant, to which reference has been made above, which, fortunately for that contention, according to the testimony of the defendant, were expressly assigned by the plaintiff as the basis of his action. “He said he appreciated very much all I had done for him in connection with the receivership matter,” is the statement. “He appreciated the heavy strain on my vitality and strength it had been to go through such an experience, and he appreciated what I had done for him in relation to his brother William and other things that I had done; and for these reasons, and all reasons, I might consider that the note was finally disposed of.” As to the character and value of these services’there can be no reasonable question; nor that they were performed at the urgent solicitation of the plaintiff, for his own personal benefit, and to the marked inconvenience, if not disadvantage, of the defendant.
It is said, however, that they were fully compensated at the time by the salary which he was to get, which was' continued to be paid him, as guarantied by the plaintiff, even after the zinc company bad gone out of business. But one of the inducements held out to him to leave his position with the Standard Oil Company was that he was to have an interest in the enterprise, which having failed, his salary did not altogether meet the situation. To its payment, moreover, the defendant himself contributed the $3,800, which he was allowed by the court for his services as receiver, which he turned over, at the suggestion of the plaintiff, to help reimburse the latter for the money advanced to the zinc company, out of which the plaintiff’s salary was paid; as
The only difficulty is that the acts of the defendant were apparently rendered without expectation of reward, for which neither then nor afterwards was any direct claim ever made. At the same time, they were in no sense voluntary, in view of which, and the assurances given by the plaintiff from time to time, particularly with regard to the note in controversy, the defendant might fairly anticipate that in some way they would eventually be made up to him. It is in the light of and with reference to all this that the promise to release is to be taken. Fifteen thousand dollars is not given away for nothing, nor is it to be explained in the present instance on the score of friendship, particularly ,as the plaintiff’s regard, as he himself says, had begun to decidedly weaken. Based squarely, as it was by the express declaration of the plaintiff, on the extraordinary services which the defendant had rendered, it thus became at the same time a recognition of their value and of the obligation resting upon him to make compensation, an admission which put the defendant in a position to demand something substantial, even if the release set up were not supportable. It was not simply, as before, that the plaintiff did not want to see the defendant lose by the venture. That, also, may have actuated him. But what he proposed, as it was put, was to positively and directly remunerate him, according to what was acknowledged to be his actual due. Conceding, then, as we must, that a consideration for the promise to release, which is relied upon, must appear, and that consisting, as it did, of services already rendered, they must have been of such a character and performed under such circumstances as entitled the defendant, not only -to expect, but to enforce, compensation, there is enough, in our judgment, to meet these requirements in what is found here. It may seem dangerous to hold, as we thus apparently do, that a money obligation of this magnitude can be discharged by a casual observation in an informal interview, without anything directly moving between the parties at the time, and with nothing but the say-so of the party released to sustain it. This is not, indeed, the whole case. But, giving full force to the circumstances