Bassett v. Lawrence

Mr. Justice Carter delivered the opinion of the court: The ultimate question in this case is, was the indebtedness created by the note sued on included in the agreement and release of January 1, 1896? There can be no , doubt that the court decided correctly in refusing to instruct the jury that it was so included, or, which was, in. effect, the same thing, to instruct the jury to find a verdict for the defendant. We are of the opinion that the agreement of January 1, 1896, canceling the original contract and releasing each of the parties therefrom, does not include the indebtedness evidenced by the note sued on. The law is, that “general words of release will be restrained in effect by the recitals contained in the instrument as applied to the subject matter; and this is true at law as well as in equity.” Todd v. Mitchell, 168 Ill. 199, and cases there cited; Lyall v. Edwards, 6 H. & N. 336; Addison on Contracts, 1223; Hazelgrove v. House, 6 B. & S. 975; Blair v. Chicago and Alton Railroad Co. 89 Mo. 383; Paylor v. Hormishan, 4 M. & S. 423; Lyman v. Clark, 9 Mass. 235; Rich v. Lord, 18 Pick. 322. The provision in the instrument which appellant contends releases him from all liability on the note is this: “It is further agreed that from and after this date no indebtedness exists in favor of either of said parties, T. F. Lawrence or O. P. Bassett, against the other.” All the recitals and all prior provisions of this contract were by their terms limited to matters involved in the contract of December, 1889, (that contract being referred to as “the within contract,”) and applying the rule of construction to the clause above set forth, the indebtedness for borrowed money evidenced by the note was not included in the release when this release was executed. Lawrence had paid all of the installments of purchase money due to that time, but by the original contract nearly as many more would remain to be paid. It is not clear that Bassett owed him anything outside of the note; but be that as it may, the agreement that “from and after this date no indebtedness exists in favor of either of said parties,” must, in accordance with well settled rules, be held to mean that no indebtedness involved in or created by or growing out of said contract should thereafter exist from either of said parties to the other. The agreement of January 1, 1896, was a cancellation of the prior contract and an adjustment of matters involved in and a release of indebtedness created by or growing out of it, and of no other matter whatever. Even if the evidence showed that prior to such cancellation and release Bassett had requested Lawrence to let the note be applied as a payment on the prior contract and Lawrence had assented to such request, still, inasmuch as it was never so applied, but Lawrence continued to pay in full the installments as they became due until the original contract was canceled by the agreement of January 1, 1896, we are unable to see how it can be contended that the note was also released, without an agreement to that effect. The note was given for borrowed money. The payments on the contract were credited to Lawrence when made and receipted for, but this note remained outstanding, and neither principal nor interest was credited to Lawrence as a payment on his contract, but he otherwise made all payments in full as they accrued, and when, by mutual agreement, the remaining payments not then due were released, nothing more remained to be paid upon which this note could have been applied. By the contract of Bassett all indebtedness of Lawrence to him upon which the note might have been applied was released before the application was made, and it follows that if there ever was a verbal agreement to apply the principal and interest as a payment on the contract, that agreement, rather than the note, was canceled by the settlement of January 1, 1896. After the time when the alleged agreement was claimed to have been made Bassett continued to receive the weekly payments from Lawrence in full without crediting the amount of the note to Lawrence and without asking for its surrender, and then, by his contract of cancellation and release, he made it impossible to make the alleged agreed application; and the effect would be the same, also, on the theory that it was agreed application should be made of the amount of the note on the contract as an advance payment, because before any such application was made the instrument upon which such advance payments could be made was abrogated by the parties. There had been no casting up of the amount due "on the note, and it is not contended that there was any agreement that the amount of it should be treated as already applied, or that it should be so treated at any particular date, but the alleged agreement was wholly of an executory character. If we are correct in this view of the case it is immaterial whether the trial court did or did not err, as against appellant, in the admission or rejection of evidence or in instructing the jury, for, taking as proved all that the appellant claimed the facts to be, there was no evidence fairly tending to establish his defense, and the court would have been justified in instructing the jury to find for the plaintiff in the amount of the principal and interest of the note. Finding no error the judgment of the Appellate Court will be affirmed. Judgment affirmed.