Brintnall v. Rice

Ingraham, J.: The defendant, being the owner of 100 barrels of whisky and desiring to obtain a loan of money, requested the plaintiff to execute a promissory note which would enable the defendant to obtain the loan upon depositing the whisky as collateral security, from one John Lyons, a liquor dealer doing business in Boston. The plaintiff executed his promissory note to the order of the defendant and delivered the same to him, who delivered it to Lyons and obtained the loan. The defendant gave the plaintiff a receipt for the note, which recited that it was received in payment. of 100 barrels of Brintnall pure rye whisky; and annexed to the receipt was a clause “ If Brintnall so desires he can return the 100 bbls. and I will take care' of the note.” Upon the evidence and the finding of the trial judge it must be assumed upon this appeal that the transaction was simply an arrangement by which the plaintiff gave to the defendant his accommodation note to enable the defendant to obtain a loan of money with the whisky as security. This note when due seems to have been taken up by another note given by the plaintiff to the defendant, which was also discounted by Lyons, who retained the same 100 barrels of whisky as collateral security, but when [56] the second note was delivered to Lyons there was added 25 barrels of other, whisky belonging to the plaintiff to be held as .additional security. When this second note was given the defendant gave to the plaintiff another receipt, which receipted for the note for $2,500, and also stated that the additional whisky deposited as collateral security for the payment of the note was to be returned to the plaintiff when the note was paid. The receipt then contained the following: “ The part of agreement of September 15th, 1890, wherein I agreed to pay the note and allow Brintnall to ret.. the 100 bbls. of pure rye whiskey is still in force and a part of this agreement to the amount of $2,344.38, with interest paid and to be paid.” When the second note became due in May it was not paid. The plaintiff never received the proceeds of either of the notes, and after the second one became due the plaintiff paid $500 to Lyons in order to have returned to him the twenty-five barrels of' whisky which he had deposited with Lyons as additional security for the note given for the defendant’s accommodation. And it is to recover this $500 that this action is brought. This $500 was paid by the plaintiff on August 26, 1891; and upon these facts it would seem clear that the defendant was at that time indebted to the plaintiff in that sum. The principal defense was the Statute of Limitations, and in order to take the case out of the statute certain letters that passed between the plaintiff and the defendant' were. received in evidence. The action was commenced on the 4th of October, 1898, and the statute has- run unless the plaintiff can produce an acknowledgment of the indebtedness or a promise to pay the debt within six years of the commencement of the action; Considering the relation which the plaintiff bore to this transaction ; that he advanced his note to enable the defendant to borrow money of Lyons; that when that note had become due and was not ' paid, he had given a new note; and to insure the discount of the new note he had advanced twenty-five barrels of his own whisky to be held as additional collateral; that when the second note became due and the defendant had not paid it, he had been compelled to pay to Lyons $500 to obtain possession of his property, which $500 was credited on account of the note, which by the agreement between the plaintiff and the defendant, the defendant [57] was to pay; that the plaintiff had been constantly endeavoring to obtain the payment of this $500, and had refused to have anything further to do with the transaction until it was paid, the letter written by the defendant dated December 21, 1892, must be considered an express promise to pay this sum. He there says: “ Notwithstanding that you have done some very foolish talking, entirely uncalled for, I will see that you will be at no loss in the Lyons transaction.” It was said in Shaw v. Lambert (14 App. Div. 267): “ There must be, however, an acknowledgment of a debt of a promise to pay a debt; and in dealing with each particular case what has to be ascertained is the intention of the writer of the instrument, upon which is based the acknowledgment of the existing liability or the new promise to pay the debt. Was it his intention to acknowledge that an obligation or debt existed, or was it his intention to promise to pay a demand made upon him ? The writing must show that it was the intention of the writer to either acknowledge the debt or promise to pay it.” The defendant was bound to pay the noté held by Lyons, and upon his default the plaintiff had paid $500 on account thereof. The plaintiff then endeavored to obtain from the defendant the repayment of this $500, and when the defendant wrote, “ I will see that you will be at no loss in the Lyons transaction,” it could only have related to a repayment to the plaintiff of the money that he had paid to Lyons.on account of the note, which,, as between the plaintiff and the defendant, the defendant was bound to pay and which payment was essential in order to prevent the-plaintiff from sustaining loss. In the case of Connecticut Trust Company v. Wead (58 App. Div. 493) we applied the same principle, but held that in that case-the letter of the defendant was not a promise to pay. There is no-uncertainty as to the rule. The only question is whether the writing relied on to take the case out of the Statute of Limitations is sufficient for that purpose. To be sufficient it must acknowledge the existence of the liability or contain a promise to pay. In this case it seems to me that there was contained in this letter such a promise to pay the $500. The promise in this case was not conditional as it was in the case of Tebo v. Robinson (100 N. Y. 27), and I cannot see that that case has anything to do with this question. The question is as to what «was intended by the defendant when he [58] wrote this letter of December 21, 1892, and it seems to me that he certainly intended to promise to pay to' the plaintiff the amount that he had been compelled to pay on the Lyons transaction which was necessary to prevent him from sustaining loss. The judgment appealed from should be affirmed, with costs. . O’Brien and Hatch, J.J., concurred; Van Brunt, P. J., and McLaughlin, J., dissented.