Riverside Milling & Power Co. v. Bank of Cartersville

Lumpkin, J. (After stating the foregoing facts.) 1. The demurrer to paragraphs seven, eight, and nine of the answer was properly sustained. This point is controlled by the decision in Strickland v. Bank of Cartersville, ante, 565. Nor was there error in rejecting and striking paragraphs one to eight and part of paragraph nine of the amendment to the answer, upon the objections made to them. 2. The suit was based on notes which contained a provision for the payment of ten per cent, on the 'amount of the debt, as attorney’s fees. The defendants were the Biverside Milling and Power Company 'as maker, and George W. Brooke and A. Strickland as sureties. As preparatory to bringing suit (as required by the Civil Code (1910), § 4252), three copies of a notice of an intention to sue were prepared. Each was directed to the three defendants. One had entered on the back of it the word “Strickland,” another the word “Brooke,” and the third the words, [581] “Brooke, Riverside Milling and Power Company.” The first two were signed by the “Bank of Cartersville, by J. W. Knight, Y. P.” The last was unsigned. The vice-president of the bank testified that he served the first notice on Strickland and the other two on Brooke, who testified that he was superintendent and manager of the defendant company. They were brought in by the defendants under notices to produce. The third paragraph of the defendants’ answer admitted that they received written notice of the plaintiff’s intention to sue on the notes, but denied that it was such notice as was required by law. This admission as to the company was afterward withdrawn by amendment, but it was introduced in evidence by the plaintiff. There was no error in admitting in evidence the unsigned notice, in connection with the other two and the accompanying evidence. 3. A written receipt for money may be denied or explained by parol. Civil Code (1910), § 5795. If an instrument contains an acknowledgment of the receipt of money, and also contains a written contract, the contract can not be altered by parol. § 4268; Southern Bell Telephone & Telegraph Co. v. Smith, 129 Ga. 558 (59 S. E. 215); Graham v. Peacock, 131 Ga. 785 (63 S. E. 348); Pennsylvania Casualty Co. v. Thompson, 130 Ga. 766 (61 S. E. 829); Coleman v. Barber, 137 Ga. 22 (72 S. E. 399). Indeed, many written contracts contain a receipt for, or recital of payment of, the consideration, and also an. agreement between the parties. Where a payment is made by a debtor to a creditor who holds several demands against him, if there is'no agreement as to the application of it, the debtor has a right to direct to which claim it shall be applied. If he does not do so, the creditor may apply it at his election. Civil Code (1910), § 4316. If there is a contract fixing the mode of application, it will control. But parties may, by mutual concurrence, depart from the mode so fixed and may apply the payment otherwise in whole or in part; and if an application is made by mutual action of the debtor and creditor, though not in strict accord with the contract, the debtor can not afterward complain thereof or have a reapplication made. Here a written contract was made between the bank and Brooke, in regard to additional security for the payment of the note of Brooke and Strickland and other notes on which Brooke was surety. It agreed that $5,000 was to be paid by Brooke on or before August 1, 1909, “to be applied to past and accrued interest due said bank, and [582] the placing the remainder to the said obligations as endorsed by said George "W. Brooke as the bank may elect.” Brooke also agreed to pay certain taxes, insurance premiums, and attorney’s fees. The $5,000 was not paid on August 1; but on August 13, Brooke brought to the Bank of Cartersville a check of one Jones for $5,000, drawn on a bank in Atlanta, and the cashier gave him a receipt in the following words: “Received of G. W. Brooke one check for Five Thousand Dollars on American National Bank, Atlanta, Ga., signed R. T. Jones, and one check for $14.44, signed by G. W. Brooke, on 1st National Bank, Cartersville, to be credited on notes signed by Riverside Milling & Power Co.” The cashier testified that he and Brooke figured in detail the mode in which this payment was to be applied, and that it was applied accordingly; and a memorandum was introduced, showing that a part of the payment was applied to interest on the note of Strickland and Brooke held by the bank, as well as on the debt of the defendant company indorsed by them, and also that $87.50 was paid to attorneys for fees. If the words in the receipt, “to be credited on notes signed by Riverside Milling and Power Company,” be treated as an agreement or election on the part of the bank to apply the proceeds of the check, when collected, to the notes signed by that company alone, it was not signed or agreed to by Brooke, according to the evidence for the plaintiff. At least it was no agreement with any one else than Brooke, or enforceable by any one else; and if he directed or agreed to a different application, it gave him no right afterward to demand a reapplication. In the case of Strickland v. Bank of Cartersville, which was by agreement argued with this case, it appears that Brooke is still insisting that a part of the $5,000, which the bank applied to the payment of interest on the note of himself and Strickland, should go in reduction of the principal of that note. He can not have the payment applied both on that note and on the one here involved. He denied in his testimony that he ever had any agreement modifying or changing the original written contract as to the application of the payments. The receipt included not only the check of Jones for $5,000, but also a check of Brooke for $14.44, which was shown to be the interest on the entire indebtedness from August 1, when the payment was. to have been made, to August 13, when it was made. This renders the paper open to some doubt as to its intention. But if the evidence of the cashier to the effect that the language of the [583] receipt-was “to show that the payment was to be .applied in a general way more than anything else," and that there was nothing in the receipt to change the application from the figures he and Brooke made, was of doubtful admissibility,, or .even inadmissible, under the evidence and charge of the court, it Would .not require a new trial. While the evidence of Brooke as to the application; of the payment did not accord with that of the cashier of the bank, the judge submitted to the jury the question of whether it .wag, qaade by the concurrence of the two parties, and the evidence authorized such submission. 4. The notes in suit were payable to the Bank of Cártersville or order, and signed by the Riverside Milling and Power .Company. Each of them contained a clause that “if we fail to pay this note at maturity, and the same is placed in the hands of an attorney for collection, then and in that event we hereby admit that we have damaged the Bank of Cártersville or the holder -of this note ten per cent, on the amount of said debt by forcing them to employ .an attorney on account of our default, and said damage is hereby declared, for value received, to be liquidated as a part of said original debt." Each note had upon it the following indorsement, signed by Brooke and Strickland: “Eor value received-• — rr hereby sell 'and assign to the Bank of Cártersville, 6a., the within note, and guarantee the payment of the same at maturity, or at any time thereafter, with interest at the rate of-per cent, per aumrm until paid, waiving homestead, demand, notice of non-payment, and protest.” Under this indorsement, the signers were liable for the attorney’s fees stipulated, as well as for the principal and interest, if the notes were not paid at maturity and were placed in the hands of an attorney and suit brought upon them, after proper written notice. 5. The evidence authorized a verdict for the plaintiff.’ .The verdict found was not specified or brought up in the record, but was referred to in the bill of exceptions as being for a stated amount as principal, and for interest and attorney’s fees. No specific exception was made as to its form, or on the ground that it undertook to declare any lien. Under the evidence, there is nothing -in any of the grounds of the motion for a new trial which requires a reversal. Judgment affirmed. All the Justices concur, except Atkinson-, J., absent.