Sykes v. Citizens' National Bank

76 P. 393 | Kan. | 1904

The opinion of the court was delivered by

Smith, J. :

The note for the amount of which judgment was rendered was a non-negotiable instrument. (Bank v. Gunter, 67 Kan. 227, 72 Pac. 842.) Itis evident that the court below regarded the note as negotiable ; otherwise, the demurrer to the original answer alleging payment by the makers to the payees would have been overruled. The testimony admitted showed payment by R. A. Sykes & Son to .Ladd, Penny & Swazey before the maturity of the paper. The payment was made by the shipment of cattle to the latter. The makers of the paper had no notice of its transfer on March 28, 1900, when the proceeds of the cattle shipped by them to Ladd, Penny & Swazey were placed to their credit in satisfaction of the debt evidenced by the note. That the note was not due ■did not affect the sufficiency of the payment. There was no objection on the part of the payees to receiving the amount prior to the maturity of the debt.

Considering the letters which passed between the parties as having been admitted in evidence, they show that on March 26, 1900, defendants below wrote to Ladd, Penny & Swazey, stating: “Will ship four cars to-morrow, Tuesday. We want to pay our note, $3300. The bal. please ex. to us.” In response to this, two days later, Ladd, Penny & Swazey wrote to R. A. Sykes & Son: “Your letter received and we applied the proceeds of your sale as directed, and will call in the note and obtain for you all the rebate possible on same.” The information contained in this letter assured the debtors that the proceeds of the cattle sale had been applied as they directed ; that is, to the payment of the note. The volunteered statement by the payees that they would call in the note and obtain all rebate possible came after the proceeds of the cattle sale had been appropriated by Ladd, Penny & Swazey to the payment of the indebtedness. The payment was complete, and the debt discharged at the moment the payees sold the cattle and received from the proceeds a sufficient sum to pay the amount of the note. When this was done the instructions contained in the letter of R. A. Sykes & Son of March 26 were followed.

The vital question is whether the makers of the note, at the time they paid the amount of it to the original payees, were without notice that the latter had by assignment parted with their ownership. If the makers had such notice before payment, they are not protected ; if they paid without notice, the debt is discharged. That part of the letter of March 28 from Ladd, Penny & Swazey to R. A. Sykes & Son in .which they say that the proceeds of the sale of cattle were applied as the letter directed narrated a past transaction, and the remainder, which informed them that they would call in the note, was a promise to do something in the future which in no manner affected the application of the payment- to the debt made before the letter was written1. The letters should have been received in evidence and the case submitted to the jury.

The judgment of the court below will be reversed and a new trial granted.

All the Justices concurring.