Orange County Trust Co. v. Miller

Hirschberg, J.: The action is brought on a promissory note made by the defendants to the order of the plaintiffs’ testatrix. The note was made on the 29th day of July, 1907, in the sum of $293.21, payable three months after date, and the judgment is for that amount, with interest and costs, less $200 paid on account. The testatrix died in March, 1909. The answer alleged as a partial defense that at the time of the execution of the note the payee held another note made by the defendants, the amount of which was included in the note in suit, but upon which they had paid a sum of money which was to be credited on the new [293] note, though the precise amount of the sum to he credited was not known at the time. The burden of proving the partial defense was upon the defendants, and it seems clear from the evidence that they have failed to sustain it. A witness testified in their behalf that at the time of the execution of the note in suit it was agreed between the parties that the amount which had been paid on the prior note should be accurately ascertained and indorsed as a payment on the new note. The deceased claimed that such payment amounted to $75 only, while the defendants claimed that such payment amounted to about $100. It was stated at the time the new note was given that the prior note was in the bank and that the payments were indorsed on it. No proof was given on the trial as to the amount of such indorsements, but the note in suit bears the indorsement of a payment of $200 made on July 20, 1908, nearly a year after the note was given and several months after its maturity, which indorsement is in the handwriting of the defendant Nathan W. Miller. It would seem to be a fair and reasonable presumption that such indorsement included the entire credit to which the defendants were entitled at the time it was made. No evidence was offered to rebut the presumption, and such presumption would seem to be very much strengthened by the additional fact that if the payments on the first note amounted to $100, as claimed by the defendants, and such payments were not included in the $200, the entire note must have been practically paid on July 20, 1908. The evidence as to the contemporaneous oral agreement at the time of the execution of the promissory note in suit was objected to by the plaintiffs and received over such objection. Aside from the question of presumption I regard it as very doubtful whether it was competent for the defendants to vary the terms of the note by proof of the conversation between the parties at the time of its execution. As was said by Judge Werner in Jamestown Business College Assn. v. Allen (172 N. Y. 291, 294): “ The general rule, that evidence of what was said between the parties to a valid instrument in writing, either prior to or at the time of its execution, cannot be received to contradict or vary its terms, applies to promissory notes and bills of [294] exchange. (Thompson v. Ketcham, 8 Johns. 148; Norton v. Coons, 6 N. Y. 33; Read v. Bank of Attica, 124 N. Y. 671.) ” The judgment should he affirmed. Woodward and Rich, JJ., concurred; Thomas, J., read for reversal, with whom Carr, J., concurred.