Grovenor v. Signor

Wallin, C. J. This action originated in a justice’s court, and is based upon a promissory note, which note is admitted to have been executed by the defendants, and delivered by them to the plaintiff. So far as material the note reads: “Casselton, Dakota, Nov. 9th, 1889. October 1st after date, with exchange, we promise to pay Wallace Gx-ovenor one hundred sixtjr-four and 3-100 dollars.” The complaint alleges that payments had been made on the note in the years. 1892, 1894, and 1895, and judgment was demanded for the balance due, with interest, after deducting the total of such payments. The defendants appeared before the justice of the peace, and filed separate answers to the complaint. The answer of the defendant Elmer L. Signor raised certain issues of fact, which issues will not be further mentioned. The separate answer of George A. Signor embi-aced a copy of the note, and, after admitting the execution and delivery of the same said answer contained.a denial that defendant (George A.) ever made the payments on the notes as stated in the complaint, and further alleged that he never made any payment or payments on the — 507 — note. Said answer further alleged that the cause of action set out in complaint did not accrue within six years before the commencement of the action. To this separate answer the plaintiff filed a demurrer upon the ground that the same did not state facts sufficient to constitute a.cause of action. After the issues were so framed, the justice of the peace, against the objection of the defendant George A. Signor severed the trial of the action, and proceeded to separately try the issues of fact arising upon the answer of the defendant Elmer L. Signor, and in which trial George A. was not allowed to participate. At the conclusion of such separate trial a judgment was entered against Elmer L. Signor for the amount claimed in the complaint, with costs of suit. After said judgment was entered, the defendant; George A. Signor filed a supplemental answer, which embraced an allegation to the effect that the plaintiff was barred from proceeding further against him in the action, for the reason that the plaintiff had already recovered a judgment in this action for the full amount claimed against his co-defendant and joint obligor, Elmer L. Sign.or, To the supplemental answer the plaintiff filed a demurrer on the ground that the facts stated therein did not constitute a defense to the cause of action stated in the complaint, whereupon the justice adjourned court, and later, and on the adjourned day, such proceedings were had that the justice entered an oredr sustaining said demurrers to the said answer and the said supplemental answer of George A. Signor. Said George A. Signor stood upon his said answer and supplemental answer whereupon the plaintiff offered said note in evidence, and rested his case, and the defendant George A. rested his case without offering evidence. Thereupon the justice entered judgment in the action in favor of the plaintiff and against the defendant George A. Signor for the amount claimed in the complaint, with costs. . The defendant George A. Signor appealed from said last-mentioned judgment to the district court,' and such appeal was taken on questions of law alone. In the notice of appeal the appellant specified the errors of law of which he complained substantially as follows: First, that the said magistrate erred in sustaining the plaintiff’s demurrer to the separate answer of the appellant, and in not permitting the appellant to defend the action upon the facts alleged in the said separate answer of George A. Signor; second, that the magistrate erred in sustaining the demurrer to the supplemental answer of the appellant, and in not permitting the appellant to defend the action upon the facts set out in the supplemental answer. It. further appears that the appellant’s case was heard and determined in the district court upon questions of law alone, and that in disposing of the case that court’s order for judgment directed, in substance, that the demurrers of the plaintiff to the appellant’s separate answer and supplemental answer should be severalty overruled, and the judgment entered by the justice against the appellant should in all things be reversed, and that the action as against the appellant should be dismissed, with costs to be taxed in favor of the appellant, George A. Signor. Judgment was — 508 — entered in the district court in conformity to such order, from which judgment the plaintiff has appealed to this court. The errors assigned in this court by the plaintiff and appellant are as follows: (I) The district court erred in overruling the plaintiff’s demurrer to the separate answer and supplemental answer of George A. Signor; (2) The district court erred in not affirming the judgment of the justice of the peace, and in dismissing the action as against George A. Signor; (3) the district court erred in not directing said action to be tried bn its merits as to said George A. Signor. The facts narrated will suffice to raise the questions of law presented for determination. In sustaining the demurrers to the answer and supplemental answer of George A. Signor the court of original jurisdiction necessarily decided that the facts set out in said answers were not sufficient to constitute a defense to the plaintiff’s cause of action, and, when said defendant stood on such answers, and did not offer to amend the same, it was at least logical, from the standpoint of the justice, to enter judgment for the amount due on the note; and that is what was done by the justice. On appeal to the district court from such judgment, that court, under the notice of appeal, was required to consider and decide two questions of law, and no more, viz.: (1) Whether the justice erred in sustaining the plaintiff’s demurrer to the separate answer of George A. Signor, and (2) whether the justice erred in sustaining the demurrer to the supplemental answer of George A. Signor Both of these questions, as appears by the order directing a judgment, were expressly ruled upon in the district court. That court overruled the justice, and entered an order overruling each and both of the demurrers to said separate answers. In this ruling the district court adjudged, necessarity, that the facts stated in said answers did constitute a defense to the cause of action stated in the complaint. But it is our opinion that the conclusion reached by the trial court, if sound and legal, did not warrant the order for a dismissal of the action against George A. Signor, which order was entered then and there without a hearing upon the facts and merits in the district court. As we see the case, the order overruling the demurrers to the two answers operated onty as a judicial determination that the facts stated in the answers, if established by evidence, constituted a defense to the plaintiff’s cause of action. But this holding certainly did not go further, and adjudicate that the allegations in said answers were not only sufficient in law, but were also severally true in fact. In our judgment, the effect of overruling the demurrers was to leave an issue of fact 3ret to be tried. From the nature and effect of the order overruling these demurrers we are clearly of the opinion that the case would fall within the letter and spirit of the following provision of the statute regulating appeals to the district court: “When the decision of the district court reopens the case for the trial of an issue of fact the decision, shall direct that the action shall be retained and placed — 509 — on the calendar of the court for trial accordingly as in other cases; and thereupon the parties may be allowed to serve and file any pleadings that, may be necessary or proper within such time as the court deems reasonable.” See § 6771a, Rev. Codes 1899. Section 6779, Id., declares: “The action shall be tried anew in the district court in the same manner as actions originally commenced therein.”- In actions commenced in the district court, in which issues of law are framed, such issues are, as a rule, first determined; and when, in such cases, the decision of the legal issues leaves questions of fact undetermined, the court will in due course proceed to hear and determine the questions of fact. This familiar rule of practice is clearly voiced in the statute governing appeals from justice’s court, from which we have quoted above'. From the briefs filed by counsel in this court we are led to believe that the district court held that the note in suit is strictly a joint obligation, and is not a joint and several obligation; and, further, that the note was barred, as against George A. Signor, because he, by answer, denied that he had personally made the payments set out in the complaint, and alleged that he had made no payments whatever on the note. But, as we have said, these vital allegations of fact were never established by any evidence offered in this action. It is true that the demurrers admitted the facts pleaded in the answer of George A. Signor, but such admission was made for the purposes of the demurrers only, and, when the demurrers were overruled and held for naught in the district court, the answers were intact, and the same raised issues of fact upon which the litigants were severally entitled to a trial upon the facts and merits. The separate answer of George A. Signor set out the statute of limitations in bar of the action, but to sustain this defense it was essential that his averment that he had made no payments on the note should be established by'competent testimony, and any such testimony could, of course, be controverted by the plaintiff, and under the statute from which we have quoted the trial court, in the exercise of its discretion, could have allowed other issues to be framed in the district court after the demurrers were overruled. The case was in the district court for trial anew. In our investigations of the case we have been greatly aided by the briefs of counsel, but, as this court has reached the conclusion that the case must be remanded to the district court for further proceedings, it is not deemed necessary or expedient to discuss all the questions which arise upon the record; and hence we shall consider but one further, matter. We have reached the conclusion that the note in suit, upon all the facts appearing of record, is a joint note, and is not a joint and several obligation. The instrument, as written, embraces no terms from which this court can infer as a matter , of law that the same is joint and several. Nor do the- pleadings lend color to any such conclusion. Neither the complaint nor the separate answer of-George A. Signor embraced a suggestion, much less an — 510 — averment, that each and both of the defendants received a benefit from the consideration for which the note was executed. The pleadings, therefore, as well as the note itself, show that the obligation was joint, and not joint and several. The note, by its terms, imposed an obligation to be performed by several persons; and hence, under the mandate of the statute, the courts are bound to presume that the note is a joint, and not a joint and several, obligation. Section 3766, Rev. Codes 1899. We have seen that no facts appear in the record whereby this note can be brought within the exception to this rule, as provided in § 3917, Id. Both parties, by their pleadings, have elected to stand upon the note as it was written; and this election, in our opinion, precludes the courts from holding otherwise. Section 3766, supra. The remaining question is whether the facts set out in the separate answer of George A. Signor, if established, constitute a bar to the action as against him. The action was commenced more than .six years after the maturity of the note, and hence the same is barred by the statute, unless the time has been extended in some manner. George A. Signor pleads the statute in bar of the action, and alleges that he never at any time made a payment on the note. We have assumed that the district court held that this defense was valid in law, and this court has reached the same conclusion. There is considerable conflict of authority upon this point, both in England and in this country; but the decided weight of modern authority will support our conclusion. Oleson v. Wilson, 20 Mont. 544, 52 Pac. Rep. 372, 63 Am. St. Rep. 639; Hance v. Hair, 25 Ohio St. 349; Mayberry v. Willoughby, 5 Neb. 368, 25 Am. Rep. 491; Littlefield, v. Dingwall, 71 Mich. 223, 39 N. W. Rep. 38; Kallenbach v. Dickinson, 100 Ill. 427, 39 Am. Rep. 47; Cooper v. Wood, 1 Colo. App. 101, 27 Pac. Rep. 884; Van Keuren v. Parmelee, 2 N. Y. 523, 51 Am. Dec. 322; Murdock v. Waterman, 145 N. Y. 55, 39 N. E. Rep. 829, 27 L. R. A. 418; Harper v. Fairley, 53 N. Y. 443; Shoemaker v. Benedict, 11 N. Y. 177, 62 Am. Rep. 95; Willoughby v. Irish, 35 Minn. 63, 27 N. W. Rep. 379, 59 Am. Rep. 297; Bell v. Morrison, 1 Pet. 351, 7 L. Ed. 174. The cases cited from the states of New York and Minnesota are decisive authority here, inasmuch as they are decided under a statute identical in language with that in this state. See Rev. Codes N. D. 1899, § 5220. The courts in the cases cited, in construing this statute, hold that a payment upon a debt is equivalent to a new promise resting upon the original consideration. But when such payment is made by one joint debtor such payment does not operate as a promise binding any one except the debtor who makes or authorizes the pajunent, and this rule is based upon the theory that the relation of agency does does not arise upon the mere relation of joint or joint and several debtors. • Counsel have devoted a good deal of time and attention to the question of whether the supplemental answer contains a defense to plaintiff’s cause of action, and this question, as presented upon this re — 511 — cord, is one of some degree of nicety; but, inasmuch as the case must, in any event, be remanded to the district court for further proceedings, we do not deem it advisable or proper at this time to pass upon this question. The issues to be presented to the district court at the next hearing of the case cannot be anticipated with any degree of certainty for the reason that the trial court, on motion therefor, may deem it advisable to allow the pleadings to be amended and upon such amendment, if made, the fact may appear that the note in suit, while joint in form, is, in its legal effect, a joint and .several obligation. (88 N. W. Rep. 278.) The judgment of the district court will be reversed, and the case remanded for further proceedings in that court. All the judges •concurring»