Bank of Hallowell v. Baker

By the, Cou/rt Ohatfield, J. When this case was before me on the demurrer to the answer, I was of the opinion that the Defendants had not done enough to fix the liability of the Bank upon the contract set out in the answer, and I consequently decided that the answer did not contain any defense'to the action and allowed the demurrer. That conclusion rendered it unnecessary to consider the questions raised upon the legal validity of the contract, and upon the admissibility or competency of the evidence thereof, (the contracts being oral,) to qualify the terms of the note on-which the action is brought, and change the character of its obligations. The answer had been interposed upon leave after it was due, and should have contained a full and true statement of the defense. The Court was bound to presume that it did contain all the defense that existed against the cause of' action alleged in the complaint. It was for that reason that — 265 — the Court in malting the order on the demurrer refused leave to amend, except upon proof showing new matter of defense. The Defendants now ask leave to amend their answer, but do not propose to insert any new matter of defense. They only propose to amend the statement of the proceedings of Baker, under the alleged contracts so as to show more fully and definitely what was done by him to fix the liability of the Bank thereon. Strictly this is not new matter of defense. It is only a new statement of matter insufficiently stated in the former answer, and not properly within the terms of the order made on the demurrer. Still I do not feel disposed to refuse to consider the matter thus proposed to be inserted in the answer or to exclude it because it is not strictly within the terms of the order. I choose rather to examine the legal effect of the matter proposed to be inserted, for if the matter thus proposed to be inserted, will so strengthen the answer as to constitute a. good defense, the Defendants should in equity have the benefit of it; if not, then there is no legal propriety in allowing it to be inserted. In the view which I am constrained now to take of this application, it will not be necessary to inquire whether the matter proposed to be inserted in the answer will have the effect to avoid the point upon which the demurrer was allowed, for if it will, then the questions upon the legal validity of the contracts set out in the answer and the competency of the evidence by which they are to be proved, will again arise, either upon a new demurrer or upon objection at the trial. They cannot be avoided. It therefore appears to me to be incumbent upon the Court now to consider whether the answer as proposed to be amended, would, if thus amended, constitute any defense to the action. It will avail nothing to determine whether or not the contract set out in the answer and therein alleged to have been made between the Bank and Baker, in January, 1854, is legally valid, unless the contract alleged to have been made at the time of the execution of the note, may be proved by oral evidence to qualify the terms and change the obligations of the note; for by the alleged terms of that contract, the money — 266 — received by Baker and for which, the note was made and endorsed, was to be taken by him as a part of the $20,000 mentioned in the first contract. The terms of the alleged contract made at the time of the ■execution and delivery of the note are wholly inconsistent with the terms of the note; and the obligations of the note are wholly incompatible with those of the alleged contract. Both ■cannot stand, for both relate to the same subject matter, the ■same money, and the time and place of its payment. The allowance of either avoids the other. The said contract is alleged to have been made orally. The note is made and endorsed in writing. The Defendants do not ■allege there was any fraud, mistake or oversight in the transaction, but it appears that the whole transaction was deliberate and well understood. Under this state of facts, it seems to me that there cannot be much doubt or question as to the rule of law governing the case. When a contract between parties is made by which fone party incurs liabilities or obligations to the other and the terms and conditions of such liabilities or obligations are reduced to writing and deliberately signed by the party assuming them, and the matter is fre.e from fraud or mistake, the writing must control and supersede all allegations of other and different terms founded upon any preexistent or contemporaneous understanding. The writing is ■conclusive of what the agreement and the whole agreement was. The same rule applies in equity, for Courts of Equity will not interpose to avoid or relieve against a contract reduced to writing and signed by the party, except upon allegations of fraud or mistake. Contracts resting in bills and promissory notes stand subject to the same rule. To illustrate — suppose a party makes a promissory note payable in ninety days ; at the expiration of sixty days, the payee .brings his action to recover the amount of the note and offers to prove an oral contract made at the time of the execution of the note, that it was to be due in sixty days, would it be admissible or competent ? Clearly not. On the other hand, suppose the payee of such a note after maturity, brings an action upon it, and the Defendant should in defense allege or •offer to prove an oral contract made at the time of the execu — 267 — tion of the note, that it should run six months, would such defense be admissible or competent against the express written terms of the note? Certainly not. A Court of Equity would not interfere in such a case, and it seems to me such a case is, in all its material characteristics, parallel with the one under consideration. The rule is too clear and firmly established and too directly applicable to this case to admit of doubt. It so seems to me. 1 Greenleaf’s Ev., S. 275, p. 351; Chitty on Bills, 162; 2 Starkie’s Ev., 549-50; 14 Wend. R., 26; 17 Wend. R., 190; 1 Hill’s R., 116; 4 Hill’s R., 420; 5 Hill’s R., 413,-17; 6 Hill’s R., 219; 7 Hill’s R., 416. This being my view of the case, the' amendment proposed to be made to the answer, would not help it at all. The defense which it discloses is not, in my judgment, legally competent or admissible. The motion for leave to amend must be denied with ten dollars costs of the motion. This cause was afterwards removed to the Supreme Court by Writ of Error. Specification of errors, points and authorities submitted by Plaintiffs in Error. Burst. That the Court erred in denying the amendment to the answer offered by the Plaintiffs in Error. Second. That the Court erred in sustaining the demurrer. 1. Because it appeared by the answer that the consideration of the said note upon which the action was brought, was the performance of a certain contract entered into by the parties therein described, and that the Plaintiffs below had not performed their contract. 2. Because it appeared by the said answer that the said contract was to be performed by the said Plaintiffs below before the maturity of said note. 3. Because the Defendants below complied with their part of the contract or tendered a compliance. 4. Because the money received by the Defendants below at the time the note was given, was received from the Plain — 268 — tiffs below as part perfdtaiance of their said contract and under the same. 5. Because by the terms of said contract, moneys to be received under the same, were not to be repaid to the Plaintiffs below until two years thereafter with interest at the rate of four per cent, per annum. 6. Because enforcing payment of the note is in fraud of the ' stipulations and conditions of said contract. TTwrd. That the Judgment is erroneous. 1. Because of the reasons above stated. 2. Because interest is therein computed and included at the rate of six per cent, per annum; whereas, by the terms of the contract admitted by the demurrer, the Defendants below were chargeable with only four per cent, per annum. . Fowrth. That the Court erred in deciding the said contract set up in the answer to be insufficient, as a defense to this action, because the same was verbal. 1. Because the rule that a written agreement shall not be affected or varied by parol, applies only to the evidence and manner and conelusiveness of proof. 2. Because the rule does not apply where the fact is not denied or is admitted by the pleadings. 3 Because the said contract was not required by law to be in wilting. 4 Because the said contract is not in issue. AUTHORITIES. As to the second alleged error assigned, and the points thereunder specified: Miles vs. O’Hara, 1 S. and R., 32; Snydam vs. Westfall, 4 Hill., 211; Allen vs. Matthews, 1 Stewart, 273, cited in 3d Vol. U. S. Digest, Sec. 88. p. 260; Rasson vs. Smith, 8 Wend, 437; Tillotson vs. Grupes, 4 New Hamp., 444, cited in 3d U. S. Digest, Sec. 649, p. 282; Sanders vs. Howe, 1 Chip., 363, cited in 3d U. S. Digest, Sec. 699, p. 283; Denniston vs. T. L. Bacon, 10 Johns., 198; Amherst Academy vs. Cowles, 6 Pick., 427, cited in 3d U. S. Digest, Sec. 698, p. 284; Hill vs. Eli, 5 Sergeant and Rawle, 363, and (authorities therein cited; Field vs. Biddle, 1 Yeates, 171; Woodhull — 269 — vs. Holmes, 10 Johns., 231; Skelding vs. Haight, 15 Johns., 274, 3 Starkie on Evidence, page 1015, (Metcalf, 3d Am. Ed.,) ibid., 1049. Hollinsheab & Beoker, Counsel for Plaintiffs in Ejror. Geo. A. Nourse, and Brisbin & Bigelow, Counsel for Defendants in Error. The Decision of the District Court was affirmed with costs, but no opinion was filed. As to the fourth error assigned and points thereunder specified: 3d Starkie on Ev., page 996, 995; 1 Starkie on Ev., page 388, 389, 390, 393, &c.; Sec. 8, Vol. 1, page 145 to 153, Fonblanques Equity, (4th Am. Ed.,) ibid., note, under p. 146; Niven vs. Belknap, 2 Johns. R, 589; Marquis of Normandie vs. Duke of Devonshire, 2 Freeman, 216; Smith vs. Patten, 1 Serg. and Rowle, 83, 84, cited; Whitchurch vs. Bevis, 2 Brok., 566; Child vs. Godolphin, Dick. Rep., 39; Cooth vs. Jackson, 6 Ves., 39, cited, and see notes to pages 148, 149, 150, 151, 152, Fonblanque’s Equity, and Cases cited therein; Sec. 127, Story on Contracts, p. 81; 1 Whillake’s Pr., 323; Boyn vs. Brown, 7 Barb., 80; 2 Story’s Equity, Sec. 755, p. 68; ibid., Sec’s 755 to 757, pages 68 to 72. The points and authorities of Defendants in Error, are" not on file.