Gernon v. McCan

Howe, J. This suit was instituted by heirs of William Mish and Oliver Dubois to annul a judgment obtained against the executors of Dubois and the administratrix pro tempore of Mish by tlio defendant, McCan, on certain mortgage notes. It was contended by the plaintiffs that the notes had been paid and extinguished long before McCan brought his suit. This payment was denied by the defendant, who averred himself to be the owner and holder of the notes in good faith, for value, and before maturity. There was judgment for defendant, dismissing the suit, and dissolving the injunction which the plaintiffs had obtained, with $2800 damages, and the plaintiffs have appealed; The main question for our decision is, whether or not the notes in question were paid, and thus extinguished, as alleged by plaintiffs. There is no question of the validity of these obligations originally. They were given for borrowed money in 1859, and were secured by — 85 — mortgage on valuable property on St. Charles street. They amounted in the aggregate to §28,000 and were to fall due March 18, 1862. It seems that about a month before their maturity, McClellan, the executor of Dubois, one of the-makers, and the agent of Mish, the other maker, finding that the notes could not be met when duo, sent the witness Yenni to Mr. Kruttschnitt, the agent of William Yogel, the owner of the notes, to negotiate for an extension. The agent agreed to extend, “at current rates,” which seem to have been ten per cent, per annum. McClellan sought to do better than this, and opened negotiations with Moore, a broker, who represented a party named Stone, who had money to invest and was willing to give time for payment at five percent. per annum. In his testimony Moore says: Dubois and Mish wanted me to have the notes extended; they could not pay them at maturity; I went to the holders of the notes several times to find out about the rate at which they would be willing to extend them; I told the agent of Dubois and Mish that it would be eight per cent, for the extension, and they told me to see if I could not do any better. * * I made arrangements at five per cent, (for) two years; I acted as broker for McClellan; he had a power of attorney to act for them, (the makers), and before the notes were extended he had to bring his power to the notary. I went to the holders of the notes and told them I had made better terms for Dubois and Mish, and would take the notes up in a few days, which I did, and had them extended before W. L. Poole, notary. Question. Where did the money come from to take up the notes; whose money was it ? Answer. It wras money of William Stone. Q. That was the money you gave to Mr. Kruttschnitt ? A. Before the notes were negotiated the trade was made with Stone in the-first place, but as he was going to leave, he made the arrangement with Major Hardy. Q. But in the matter you acted as broker or intermediary of the parties ? A. Yes, sir. Q. How was the payment made; how did you get possession of the notes'? A. I went to Mr. Kruttschnitt’s office and tendered the money. He told me he wished I would go to the bank and have it deposited, as he was not a very good judge of money. He asked me to go with his young man, and then he would know it was all right, if it wras put to his credit in the bank. Q. And you did go and deposit the money to his credit ¶ A. Yes, sir. Q. And then he gave you the notes ? — 86 — A. Tes, sir. Q. And you gave the notes to Mr. Stone ? A. I gave the notes to the party who made the negotiation in the meantime, to Major Henry. Q. And this renewal was in pursuance of the original agreement under which you took up these notes ? A. Tes, sir, I had possession of the notes all the time until they were extended. The witness further says of the notes: X bought them before the maturity. They wore extended by this act before Poole, and then there was this renewal of the eighteenth March, 1864, for two years. lie then testifies to the further extension of the notes to March 18, 1867, by the defendant, McCan, who had bought them from witness’s firm for about their face value in lawful money. The two notarial extensions are in evidence, and memoranda thereof are indorsed on the notes. The last extension is indorsed by a memorandum in the handwriting of a partner of Moore. We do not understand that there is any dispute respecting the facts thus far stated, or any doubt of the truthfulness of the witness whose testimony we have quoted. • On the part of plaintiffs, Kruttschnitt, the agent of Vogel, who was holder of the notes in the early part of March, 1862, testified. Q. Were these notes ever paid to you, if so, when and where? A. I got the money on the eleventh of March, (1862), I believe, from Mr. Moore; it was Confederate money. The notes were deposited in the Citizens’ Bank. Q. Had there been any effort made to pay these notes while in the Citizens’ Bank? A. I should think so from the fact that the person — I believe Mr. Moore or some one else — came to me and said he must withdraw the notes from the bank because the bank could not receive Confederate money without a written authorization. Q. When the money was paid to you, did you make a sale of the notes to the person who paid the money; did you make a transfer of your rights to him, or did you deliver up the notes as to a person who was paying them? A. I delivered them as to a person who was paying them. ■Q. Ton never sold the notes at all for Confederate money ? A. Certainly not. ■Q- Did you want to receive payment in Confederate money ? A. I took legal advice about receiving Confederate money, and the •opinion was, I could not be forced to receive it, and that if I instituted a law suit, I might recover in gold and silver. He (the lawyer) said: — 87 — “ That is my advice as a lawyer; now I will give you my advice as a friend” — and that advice was to take Confederate money, because at that time it was very dangerous to refuse to take Confederate money. One of my personal friends was very nearly lynched for refusing to receive it. About a month or so before this I was applied to to renew those notes. There was no rate stipulated, but I told them I would renew the notes at the rates ranging in the market at the date of maturity. I gave my consent to renew the notes, but no rate was agreed on.” It is not necessary to consider the effect of the use of Confederate money in this case, since the original consideration of the notes was lawful and valuable. 21 An. 513. -The main point relied upon by plaintiffs is that the notes were paid in March, 1882, and thus extinguished, and that they are entitled to the benefit of this fact, although neither they nor their ancestors nor their ancestors’ representatives have ever paid a farthing, and, despite the fact that the executors, agent and administratrix we have named, never made any such plea, but permitted the judgment sought to be annulled to be recovered without defense. It is true that the payment of a debt which is to be acquitted in money, is permitted to be made by a third person, even one not interested. The right thus to pay is absolute; it may be exercised not only against the will of the creditor, but without the knowledge and •even against the opposition of the debtor; because on the one hand the creditor has no interest and consequently no right to refuse a regular and satisfactory payment, and it is a matter of indifference whence the money comes, and because, on the other hand, it is permitted to every one, by a kind of .“ fraternal .mandate,” to ameliorate the condition of another, even without his knowledge and against his will. Larombiere on Obligations, vol. 3, p. 66. Thus Gaius decided: “ Solvere pro ignorante et invito euique licet, cum sit jure civili constitutum lieere eliam iynorantis invitique meliorem conditionemfacere,” Dig. 46, 3, 53; and this rule of the Roman law has been continued in article 1236 •of the Code Napoleon and in the corresponding article 2130 of the Code of Louisiana. But it seems equally clear that the payment thus permitted must be the deliberate and intentional act of the third person who makes it; that this provision of law is not meant to entrap the unwary; and that one who, like Stone or Henry, sends his broker to buy negotiable paper, shall not find that paper turning to ashes in his grasp, as by a sort of legal sorcery, simply because the person to whom he gives his money •erroneously imagines that the transaction is a payment, and not a purchase. In the case of Bloodworth v. Jacobs, 2 An. 26, this court said! in regard to payment: “It is not only the delivery of a sum of — 88 — money, but tbe performance of an obligation. It is an act calling for tbe exercise of tbe will, of consent, without which it has not the characteristics of that mode of extinguishing obligations;” and we are satisfied that there was no such consent in the case at bar. We might even doubt if Kruttsehnitt was justified in forming the opinion of the nature of the transaction, which he expressed in his testimony. He knew the makers required indulgence and extension. He knew that Moore was a broker negotiating for an extension, and that he had made better terms with other parties than he (Kruttsehnitt) would grant. He had no reason to imagine that Moore delivered him the money “in the name and for the discharge of the debtors;” but he was aware that the money came before the maturity of the notes. Should it not have seemed strange to him that debtors who were praying and paying for an indulgence should be discharging the debt before maturity 1 Nor could he have easily imagined that at such a time Moore was a third person, acting in his own name, and volunteering to pay so large a debt from charitable motives, by a “fraternalmandate,” extinguishing the obligation, releasing the mortgage, and trusting for his reward, almost, to the doubtful security of an action ex wquo et bono. It is not unfair to remark that this opinion of Kruttsehnitt had but a small foundation. The notes in question were given for a consideration of the highest character. The makers were unable to pay them at maturity and sought to obtain an extension, at first from the holder, but ultimately and more advantageously, by an equally common method, a purchase by some one who had mo'ney to invest in such securities and was therefore not only willing but anxious to give further indulgence. The extension was made accordingly. We must conclude that the plaintiffs, on whom the onus rests, C. C. 2429, have not established payment and extinguishment with reason.able certainty. 16 An. p. 368; 18 An. 245. It might be urged that if there was no payment for want of consent, neither was there any purchase and transfer for the same reason. But we apprehend that the plaintiffs can not be heard to say this. Tho notes, originally valid and still unpaid, are indorsed in blank and pass from hand to hand. Yogel does not claim them, and the plaintiffs do not contend that the possession and enforcement by McCan deprived them of any defense they might have had against any previous holder. The amount of damages allowed was clearly proved. The defendant in answering the appeal has asked that they be increased, but we are not prepared to say that they should be. The plaintiffs urge that they ought not to have been allowed at all against the sureties, on tho ground that the act of 1855, providing for a judgment for damages and fees against the sureties of a plaintiff who enjoins the execution of a — 89 — judgment, applies only where the judgment has been enjoined, on an allegation of compensation, set-off or payment, since the rendition of the judgment. Acts of 1855, p. 324. A different rule, however, seems to have been settled by repeated decisions o± this court. 13 L. 380; 2 An. 822, 874; 4 An. 188 ; 10 An. 419; 11 An. 91, 280, 697; 12 An. 181, 587; 14 An. 737; 15 An 52. Judgment affirmed. Rehearing refused.