Burkhart v. Hart

Mr. Justice Bean delivered the opinion of the court. This action was commenced October 3,1896, to recover on a promissory note for $100, executed by the defendant, and made payable to the order of the Title Guarantee & Trust Company, one year after date, and assigned to the plaintiff after maturity. The complaint is in the usual form. The answer alleges that at the time the note was made the defendant was the owner of a lot in the City of Portland, fronting on what would be Yamhill Street if extended, and that the trust company was the owner of property immediately in front thereof, within the boundaries of such street; that the defendant and other parties were desirous of procuring such extension, and it was estimated and agreed by and between the trust company and the defendant that the proportion of the expense of the dedication of sufficient land therefor, properly chargeable to the defendant, was the sum of $100, and that, if the defendant would execute the promissory note mentioned in the complaint, the trust company would, within a reasonable time thereafter, and before the maturity of such note,-cause or procure, at its own cost and charge, and without cost to the defendant, the extension of Yam-hill Street from East Twentieth to East Twenty-Fifth Street, and, if such dedication and extension were not so [588] made, there should be no liability on the note, and defendant should not be required to pay the same ; that in consideration of the performance of such undertaking and agreement on the part of the trust company, and no other or different consideration, the defendant made, executed, and delivered the promissory note mentioned; that the company has failed, neglected, and refused to procure the dedication and extension of the street as agreed or at all, and by reason thereof the consideration of the note has wholly failed. The reply denies the allegations of the answer, and sets up what plaintiff claims to have been the real contract between the parties. A judgment was rendered in favor of the defendant, and the plaintiff appeals, claiming that the court erred in overruling his objection to the admission of evidence tending to show nonperformance by the trust company of the contract alleged in the answer, to parol evidence of such contract, and in denying a motion to amend the reply so as to make it conform to the proofs. 1. The principal contention of the plaintiff is that the respective agreements of defendant and the trust company are independent covenants, and therefore the failure of the trust company to perform its contract is no defense to an action upon defendant’s note. In support of this contention he invokes the well-known rule that “if a day be appointed for payment of money, or part of it, or for doing any other act, and the day is to happen, or may happen, before the thing which is the consideration of the money or other act is to be performed, an action may be brought for the money, or for not doing such other act before performance, for it appears that the party relied upon his remedy, and did not intend to make the performance a condition precedent; and so it is where no time is fixed for performance of that which is the consideration of the money or other act:” Note to Pordage v. [589] Cole, 1 Saund. 319. This, however, is but one of the general rules adopted by the courts .for determining the character of the respective agreements of parties to a contract, and, like all general rules, is not applicable to all cases. Indeed, there is no arbitrary test by which the question can be determined. The old decisions turned upon a technical construction of the language used, but the modern doctrine is that a contract should be construed according to the meaning and intention of the parties. It is unnecessary for us to make special reference to the several rules upon the subject or the various decisions of the courts. It is sufficient to say that “in the absence of very clear indications to the contrary, promises, each of which forms the whole consideration for the other, will not be held to be independent of one another, and a failure of one party to perform on his part will excuse the other from liability to perform :” Clark, Cont. 656. Applying this principle to the case in hand, itis quite clear the court committed no error in holding that the nonperformance of its contract by the trust company within a reasonable time was a defense to an action upon the note. The whole consideration for the note was, as alleged, the performance by the company of its agreement, and if it failed to do so the consideration necessarily failed. In Hawley v. Bingham, 6 Or. 76, the consideration for the note was a mere agreement and promise of the payee ; and so, also, in Pratt v. Gulick, 13 Barb. 297. In Walker v. Clay, 21 Ala. 797, the note by its terms matured before the contract of the payee could be performed, and he was not in default at the time the action was brought. In McRaven v. Crisler, 53 Miss. 542, 546, the note was due one day after date, and there was no allegation or proof that a delivery of the deed of the land for which it was the consideration was to be made at or before the payment of the note. • It is often extremely difficult to de [590] termine whether the covenants of the respective parties to a contract are dependent or- independent, and there is much conflict in the authorities upon the question; but, as already said, each case depends upon its own facts and the justice and good sense of the matter. And certainly the payee of a promissory note, given in consideration that he should perform a promise on his part, ought not to be permitted to recover on the note when he has failed to keep his promise. 2. It is also claimed that the court erred in admitting parol evidence of the contract between the defendant and the trust company, for the reason that such contract is in writing. The original agreement was in parol, but some six or eight months later the defendant, being about to sell and dispose of his property, obtained for the purchaser a writing from the trust company, which recited that it had received from him “a promissory note for one hundred dollars, in consideration of the widening of East Yamhill Street, adjacent to Lot one, Block one, Central Park, dedication to be executed in a reasonable time.” It is contended that this writing embodies the contract between the parties ; but, as we understand the record, it is nothing more than an acknowledgment by the trust company of an existing contract. In this view of the case the other assignments of error become immaterial, and the judgment is affirmed. Aeeirmed.