Summary
In Noel v. Murray (supra) the Court of Appeals indicated that the test as to whether or not the acceptance of a third party's obligation was contemporaneous with the creation of the original indebtedness was whether it was intended that title to the property involved pass contemporaneously with the acceptance of the third party's obligation.
Summary of this case from Siegel v. CobertOpinion
December Term, 1855
George C. Goddard, for the appellants.
Henry Day, for the respondent.
It may be conceded that the acceptance of the note of a third person by the creditor from his debtor does not operate as a satisfaction of the precedent debt, unless it be shown that such at the time was the agreement of the parties. The difficulties in the application of this rule have generally been found to be in determining what evidence was sufficient to establish the fact of the agreement, or to justify submitting the evidence to the jury as raising a question of fact for their determination. ( See Waydell v. Luer., 3 Den., 410, and cases cited by Lott, Senator; Breed v. Cook, 15 J.R., 241; Whitbeck v. Van Ness, 11 J.R., 409; Arnold v. Camp., 12 J.R., 409.) The onus of showing that the note or bill was taken by the creditor in payment or satisfaction of the precedent debt is upon the debtor. In the present case, the plaintiffs' counsel insists that the sale of the looking glass plates was complete on the 10th October; that at that time the defendant became and was the debtor to the plaintiffs for the $1027, and that upon the 12th of October, he paid a small sum in money upon the account, and delivered the note made and endorsed by J. Howard Son; and he claims that there was no evidence tending to show an agreement between the parties that such note should be received by the plaintiffs in payment of the balance of the account. In short, that the evidence did not justify a submission of this question to the jury.
Without here stopping to consider the sufficiency of the evidence to fairly raise the question of fact, whether the note was by the agreement of the parties taken as payment, I think the counsel is mistaken as to there being any debt on the 10th October. There was no valid binding contract between the parties until the 12th October, when some of the plates, and the bill of them, were delivered, and when the note was delivered and the balance paid in money. The defendant called and ordered the plates on the 8th. He sent the man who was to make frames for them to measure them on the 10th. They were measured on that day, and the bill, bearing date that day, made out. On the 12th, the defendant called and settled the bill, and a portion of the plates were actually delivered on that day; and others remained with the plaintiffs until they were wanted. When was the sale completed? When did the title pass? There is no evidence that credit was to be given. The whole proceeding was conducted in the ordinary way of cash sales. The bargain to purchase was probably made on the 8th, or say the 10th when the plates were measured and the bill bears date; but there is no evidence whatever of any agreement or understanding that the plaintiffs should deliver the plates until they had received the pay for them. The fair construction of the evidence, including what is said in the pleadings, is that the plaintiffs were not to part with the title to their property until the matter of payment had been arranged. The sale was not completed so as to pass the title until the matter of payment was arranged; and that was at the time the note was delivered and the money paid. The sale and delivery and payment were to be simultaneous acts. Thus understood, there was no precedent debt; and the case comes under the rule, that when, at the time of the sale and delivery of goods, the vendor receives from the vendee the note of a third person for the price, the presumption is, that he takes it in payment. ( Whitbeck v. Van Ness, 11 J.R., 409; 3 Cow., 280; 15 J.R., 241.)
In this view of the case, it is quite unnecessary to refer to the statute of frauds. But by the statute, whatever agreement the parties may have made in relation to the sale of the goods on the 8th or 10th of October, was void, as the value exceeded $50, and there was no note or memorandum in writing, and no part of the consideration was paid, or any part of the goods accepted. (2 R.S., 136.) The plaintiffs' counsel argues that there was a delivery and acceptance at the time the plates were measured for the frames, on the 10th October. In this, as I have already said, I think he is mistaken. Nothing occurred which could divest the plaintiffs of their title and vest it in the defendant. (3 Barn. Ald., 680; id., 321; 5 id., 855.)
The plaintiffs have no cause to complain of the charge. The question was put to the jury to say whether it was a part of the agreement at the time of the sale and delivery of the goods, that the note was to be taken and received in payment. There was certainly evidence tending to show that such was the agreement between the parties. Aside from the receipt, there was evidence tending to show this. As we have seen, if there was no acceptance, and acceptance implies a delivery, until the payment was made, then the presumption was that the note was taken in payment. If there was an acceptance prior to the time of payment, then the receipt of the note and money " in full for the above bill" was evidence unexplained of the taking of the note in payment. There was no evidence to explain the receipt and other circumstances, tending to show that the note was taken as payment for the goods.
The judgment should be affirmed.
It is well settled, both on authority and principle, that the acceptance by the creditor, of the note of a third person for an antecedent debt, is no extinguishment of the debt, unless it is shown that there was an agreement between the parties that it should operate as an extinguishment; and that in such case, the onus is upon the party seeking to set it up as a payment. But where there is no debt existing between the parties, and the one delivers to the other property and receives in return the note of a third person in full or part payment, and gives a receipt saying that it is received in full or part payment, the presumption is that it was so received, and the onus is then upon the party receiving such note to show the contrary.
In the case at bar, the price of the goods being more than $50, and as there was no payment, memorandum in writing or part delivery until the 12th October, there was no debt until that time; consequently the case is one where the creation of the debt and the receipt of the note were cotemporaneous acts. And the whole question was left fairly to the jury. They have found that the note was received in payment and their verdict is conclusive.
The judgment should be affirmed.
Judgment accordingly