Schultz v. Plankinton Bank

Moran, P. J. It is well settled in this State that where a mortgage secures several notes due at different times, and there is no special agreement to the contrary, the notes are entitled to payment from the proceeds of the mortgaged property in the order m which they become due and payable. Marseilles Manufacturing Company v. Rockford Plow Company, 26 Ill. App. 198, and cases there cited. Assuming, for the purpose of inquiring as to the rule of law applicable to the question presented, that the affidavit states facts, admissible as evidence, as they are therein stated, to show that the bank made the agreement which it is contended it did make, with reference to the note indorsed by Henry Schultz, the question is, was such parol evidence admissible to vary the legal effect of the chattel mortgage? Counsel for plaintiff in error have ingeniously suggested many theories and cited numerous authorities to support their contention that such evidence was admissible and competent. It would be a very great, and as we view the point, a profitless labor, for us to enter upon a discussion of the various grounds and attempt to distinguish the many cases on which counsel contend that the evidence was admissible. We think ¡there are a few well settled principles of law, which, when considered, make it clear that the written chattel mortgage can not be varied in its terms or legal effect by parol evidence, where the question arises between parties and under circumstances as in this case. It may be stated that the rule of law is inflexible, that as between the parties to a written instrument, it can not be altered by parol proof, and this rule applies with the same force to exclude an alteration of the implication of law that arises upon a writing, or in other words, its legal effect, as it does to a change of the written terms of the instrument. In Mason v. Burton, 54 Ill. 349, it was sought by one who had indorsed a promissory note, to prove a verbal agreement, made at the time of the indorsement, to the effect that he should not be responsible as indorser. The Supreme Court said: “This evidence was properly excluded. His assignment of the notes meant that, in certain contingencies defined by the statute, he would pay the notes, and it meant this as fully as if this agreement had heen written out in words. This was the legal effect of the assignment, and it can not he impaired hy proof of a different parol agreement.” By the Supreme Court of the United States it was said: “There is no rule of law better settled or more salutary in its application to contracts, than that which precludes the admission of parol evidence to contradict or substantially vary the legal import of a written agreement. Renner v. Bank of Columbia, 9 Wheat. 587; and see Martin v. Cole, 104 U. S. 30, where the cases are referred to, and those holding a contrary doctrine shown to have been overruled or discredited. But it is argued this rule only applies between parties to the instrument and their privies, and appellant is neither party nor privy to the mortgage. We can not assent to the proposition that appellant does not place himself in the relation of privy to the contract made between the bank and Henry Schultz. He claims that for the consideration of the goods mortgaged, the bank made a promise for his benefit. He is seeking to make his defense to the note by insisting on the enforcement of the promise. If, in fact, such a promise was written in the mortgage, and the mortgage not under seal, appellant could enforce it in his own name. If, instead of an agreement to apply the proceeds of the mortgaged property to the discharge of the note, the promise written in the mortgage had been to pay appellant a specific sum of money, he could maintain an action for it in his own name. Moore v. House, 64 Ill. 162. The agreement or promise is one claimed to be made by the hank to Henry Schultz for the benefit .of appellant. His right to maintain an action for the breach of such an agreement “does not rest upon the ground of any actual or supposed relationship between the parties as some of the earlier cases would seem to indicate, but upon the broader and more satisfactory basis that the law operating on the parties creates the duty, establishes a privity and implies the promise and obligation on which the action is founded.” Brewer v. Dyer, 7 Cush., 337; Lawrence v. Fox, 20 N. Y. 268; Hoffman v. Schwabe, 33 Barb. 194. The evidence of such a promise is to be found in the agreement between the original parties, and that agreement must be proved in accordance with the rules of evidence. If it rested in parol, then it may be established by parol evidence; if it was reduced to writing, then the writing is the best evidence and such writing can not be varied or its legal effect altered by parol. Schemerhorn v. Vanderheyden, 1 Johns. 139. Ho course of reasoning can take appellant’s claim in this case out of the operation of this rule. His only right is based on the contract, which he says was made by the Plankinton Bank with Henry Schultz in consideration of the mortgage. He introduces the contract in evidence, and claims under it. The parties to that mortgage have made it “ the" authentic memorial ” of the agreement, and for the parties to it and all who claim under it, it speaks the whole truth upon the subject-matter. The principle that one who claims under a contract is bound by this rule of evidence is recognized in many of the cases cited by appellant. Talbot v. Wilkins, 31 Ark. 420; Reynolds v. Magnus, 2 Ired. 30; Cunningham v. Milner, 56 Ala. 525; Manufacturing Company v. Wire Fence Co., 109 Ill. 79. The action of the court in excluding the statements contained in the affidavit, is to be sustained on another ground. If the reason given by the court for excluding the affidavit was a bad one, and we have seen it was not, still the action of the court in excluding it was correct for the reason that there is no statement of facts in the affidavit competent as evidence. The material part of the affidavit is “ that thereupon the plaintiff agreed with said Henry Schultz that if the said Henry Schultz would make such transfer as requested by said plaintiff, said plaintiff would, out of the proceeds of the property so to be transferred, first pay off and take up said accommodation note of this defendant, being the note in controversy; that said Schultz would not have made a transfer as thus requested, to said plaintiff, if such agreement had not been made, but relying upon such agreement said Henry Schultz did make such transfer of all his property to said plaintiff, upon the express understanding and agreement with said plaintiff, that said plaintiff would convert said property into cash, and out of the same first pay the said note of this defendant.” It will be observed that the affidavit states the conclusion that the plaintiff agreed, etc.; no conversation or words showing an agreement are set out, no statement of facts from which such agreement can be inferred; an affidavit should state facts, and not conclusions, which are merely the affiant’s opinion. It is for the court to draw inferences and conclusions, and then only from facts proved. Waarich v. Winter, 33 Ill. App. 36. “Proof is the perfection of evidence, for without evidence there is no proof, although there may be evidence which does not amount to proof. Proof by affidavit can only be made by a statement and verification of such facts as are requisite to establish the principal fact sought to be maintained.” Town of Duanesburg v. Jenkins, 40 Barb. 574. Here the principal fact sought to be maintained was the agreement. Ho issue can be taken on a conclusion, and in this affidavit there is nothing more than the bald conclusion. In Baker v. Akerman, 77 Geo. 89, the affiant alleged that he was the surety for his co-defendant, and this fact was known to plaintiff, and that plaintiff “ made a contract with the principal defendant by which, for a valuable consideration, she agreed to indulge him,” etc. The court in discussing the affidavit said: “ There is no fact set out in this affidavit upon which issue can be taken, or on which perjury could be assigned in the event it should turn out to be false. The statements are only conclusions, which it would be the province of the court, and not of the affiant, to draw from facts properly stated. * * * Such general averments amount to nothing. They are mere Irutuin fulmen and can not be passed upon by the court.” See also Gould v. Gage, 118 Penn. St. 559; Erie City v. Butler, 120 Penn. St. 374. But the affidavit is not only faulty in not stating facts showing an agreement. It fails to show with whom the agreement was made. The plaintiff is a corporation arid can only make agreements by its duly authorized agents. With what agent or officer was this alleged agreement made? It is uncertain and evasive to say it was made with the- plaintiff. There could be no agreement with the plaintiff, personally; then with whom was the agreement? How could the plaintiff disprove the allegations of this affidavit if it had been required to do so? If the witness were on the stand, he would not be allowed to state that he made an agreement with the plaintiff. Such a statement would be incompetent, and so it is incompetent when offered in an affidavit. “A corporation is a purely artificial body, and can act only through agents; hence, unless the receipting agent is set forth to whom the money has been paid, and the special circumstances attending such payment, the defendant might just as well swear to a plea of payment with lessee and offer that as an affidavit of defense.” McCracken v. First Pres. Con., etc., 111 Penn. St. 109. The affidavit, in the terms in which it was drawn, was not competent evidence to prove any agreement with the plaintiff, and therefore appellant has no ground on which to complain of its exclusion. There is no error, and the judgment must he affirmed. Judgment affirmed. Waterman, J., having decided this case in the Circuit Court, takes no part in its determination in this court.