14 Ga. App. 344 | Ga. Ct. App. | 1914
(After stating the foregoing facts.) The contract set out in this ease is for the sale of a specified number of bales of a certain grade of cotton, at Winder, Georgia, to be delivered “on the 1st to the 25th day of November, 1909,” at a fixed price. The contract recites a mutual obligation to sell and to buy, and a consideration of one dollar paid. If the contract stopped here, there could be no suspicion aroused by its perusal. If the seller failed to deliver, the buyer would have a cause of action against him, and the measure of his damages would be the difference between the market value of the cotton at the time of the breach of the contract and the price named in the contract. If the seller tendered the cotton and the buyer failed or refused to take it, the seller would have the right to sell the cotton in the open market, — that is, sell it for its market value, — and sue for and recover the difference, if any, between the agreed price and the proceeds of the sale. The contract, however, provides for the contingency of failure to deliver or to accept, and, instead of leaving the result of 'a breach of the contract to be settled as above stated, it is agreed that time is of the essence- of the contract, and that, if the seller fails to deliver or the buyer fails to accept, then the damages shall be liquidated; and the amount of damages is fixed at the difference between the contract price and the market value at Winder of the grade of cotton named in the contract. Upon the face of the contract there appears
If the contract was valid upon its face, it was incumbent, upon Mr. Russell, to show that it was the intention of both parties — of himself and Lyle & Company that no actual cotton was to be delivered. In the ease of Forsyth Manufacturing Co. v. Castlen, 112 Ga. 199 (37 S. E. 485, 81 Am. St. R. 28), it is held: “When a contract is valid upon its face, or3> when taken in the light of the circumstances surrounding the parties at the time it was entered into, appears to be valid, it is incumbent on him who attacks the contract to show its invalidity.” Did the defendant Russell carry this burden? He testified in substance that he did not expect or intend to deliver the cotton, that it was his intention to settle on differences. He did not specifically say that Lyle & Company had the same intention, but he did say that Lyle knew he had other contracts of the same nature, and that it was the intention to settle on differences. Lyle’s testimony was to the effect that his under
If the contract between Russell and Lyle & Company was for cotton futures, that is to say, a speculation in chances, and no actual cotton was to be delivered, then it can not be enforced. Neither Russell nor Ljde & Company, under such circumstances, could have enforced it; and if there was nothing more than a transfer of the right of Lyle & Company under it to Turner, if it was illegal he could not enforce it. A gaming contract transferred to an innocent holder for value, before due and without notice, can not be enforced. Cunningham v. National Bank of Augusta, 71 Ga. 400 (51 Am. R. 266). As we have said, if the contract was valid and binding, then Turner, as transferee, could_enforce it; and he could collect the note given in lieu of it. But suppose it was a contract for cotton futures, and concede that Lyle & Company could not enforce it, and that Turner, simply as a transferee for value, could not enforce it, then let us see how the case stands under the facts and circumstances under which the evidence shows Turner got the note sued on. Russell and Lyle entered into a contract for the sale and delivery of fifty bales of cotton, as shown by a contract which Russell prepared. Lyle testified: "I owed Mr. Turner when I transferred this contract to him. That contract represents what I owed him. I owed him the amount of that contract; . . and when Mr. Russell gave Turner the note, he (Turner) credited me; he made a settlement with me by accepting the note of Mr. Russell.” It is conceded that Russell’s contract was turned over to Turner before the time for the delivery of the cotton arrived. It is clear that, where two parties enter into a contract apparently legal on its face, and one of the parties seeks to avoid it upon the ground that it can not be enforced because it was a contract for the‘sale of' cotton futures, he must show that it was the intention of both parties that actual delivery should not be made. In Forsyth Manufacturing Co. v. Gastlen, supra, it is held that "an executory agreement for the sale of goods to be delivered at a future day
In regard to the question of no consideration: There was an agreement.to sell and an agreement to buy. If the contract was illegal, — if it was a contract for cotton futures, a gaming contract, —then it was void, whether there was a consideration for it or no consideration; and we are here considering the consideration solely on the question as to whether or not the contract, if otherwise legal, was supported by a consideration. And we conclude that, if otherwise legal, it will not fail for want of a consideration. In Nathans v. Arkwright, 66 Ga. 179, it was held: “The recital of the payment of one dollar as the consideration of a quit-claim deed is sufficient; that' it was not actually paid does not affect the validity of-the conveyance; if not paid, it was recoverable.” In Southern Bell Tel. Co. v. Harris, 117 Ga. 1001 (44 S. E. 885), it was held: “Where a contract contains a recital of the payment of one dolíalas its consideration, the contract is valid though the sum named was not actually paid. It creates an obligation to pay that sum, which can be enforced by the other party.”
The plaintiff contended that the defendant Russell was estopped to plead that the contract was a deal in cotton futures; that even if it was in fact such a contract, Russell had done things and kept
In the case of Edenfield v. Canady, 60 Ga. 456, it was held: “That, on'the part of the two debtors, the motive to the substitution was a 'gaming contract between themselves, which contract was illegal and void, will not hinder the substitution from being effective by way of estoppel, if the creditor discharged his original debtor and accepted the substitute without any notice that the transaction involved the execution or settlement of a gaming contract.” In that case Judge Bleckley said: “That one set of parties had between them a gaming contract, which was illegal and void, will not hinder the substitution from being effective by way of estoppel, if the legal creditor discharged his own legal debtor and accepted the substitute without notice that the transaction involved the execution 'or settlement of a gaming contract.” In Angier v. Smith, 101 Ga. 844 (28 S. E. 167), it was held that “the defense of usury is good, even against a bona fide holder for value
Was there a novation of the contract? Section 4226 of the Civil Code of 1910 is as follows: “One simple contract as to the same matter, and on no new consideration, does not destroy another between the same parties; but if' new parties are introduced by novation, so as to change the person to whom the obligation is due, the original contract is at an end.” ' In this case the obligation of the plaintiff in error originally was to Lyle & Compány, while the note sued on is payable to N. S. 'Turner, to whom the evidence shows the original contract of the plaintiff in error was transferred. In Windham v. Doles, 59 Ga. 265, it was held: “The purchaser of lands, who gave his notes therefor in 1870, and renewed them from time to time after they got into the hands óf a bearer, who bought before due and for value, and gave said bearer, in 1873, new security and indorsement thereon for the balance due, with time extended for payment, can not set up the partial failure of consideration in the original trade, against the payment of the notes so renewed, although the bearer may have heard of the partial failure of consideration. The renewal for the consideration of additional time, and the new parties to the renewed contract, make a novation which estops the defendants from opening the question of the original consideration.” In the case of Dever v. Akin, 40 Ga. 423, it was held, that where one was indebted to another for slaves bought of him, and the person to whom the debt was due was indebted to a third person,for land, and by mutual •agreement of the three parties they wound up the several transactions by the giving of a note by the party who owed the debt for the slaves, to the .party to whom the debt for land was due, the amounts of the debts being the same, this transaction was a novation, and the maker of the note could not plead that it was void on the ground that the original indebtedness for slaves was void.
In conclusion, we decide that, even if errors in the charge really existed as set out in the motion for a new trial, they were harmless, because, as we view the ease, the verdict was demanded, and there would have been no reversible error if the judge below had directed it. Judgment affirmed.