Empire Cream Separator Co. v. Marshall

Taylor, C. Plaintiff brought suit for a balance claimed to be due on a book account for goods sold defendant. At tbe opening of tbe trial, it was stipulated that defendant was indebted to plaintiff in tbe amount claimed, unless sucb indebtedness bad been paid by tbe giving and acceptance of certain promissory notes tberefor. After making this stipulation defendant. claimed and was accorded tbe right to open and close. He presented bis evidence, and at its close tbe court directed a verdict for plaintiff. A motion for a new trial was denied and defendant appealed. On June 1, 1921, defendant bad on band machines and implements purchased from plaintiff of tbe value of about $12,000, and owed plaintiff tberefor a balance of $4,332. On that date defendant sold this entire stock to John Hammer for something over $11,-500. Plaintiff’s representative, one Evans, was present and took part in this transaction. By agreement between tbe three, Hammer executed his notes for tbe balance due plaintiff which were then indorsed by defendant and delivered to Evans. Hammer failed to pay tbe notes and plaintiff seeks to recover from defendant on the original account. Defendant insists that under tbe evidence tbe question whether tbe original debt was extinguished by tbe notes was at least a question for tbe jury. Giving notes for an antecedent debt is presumed to be conditional payment only, and does not discharge tbe debt unless expressly given and received as absolute payment; and tbe rule is tbe same though third parties join in tbe notes. Mikolas v. Val Blatz Brewing Co. 147 Minn. 230, 180 N. W. 109, and cases cited therein. Tbe party claiming that sucb notes were given and accepted in payment [238] and satisfaction of the original debt has the burden of proving that fact. In the present case defendant claims that the agreement under which the notes were executed shows that they were given and accepted for the purpose of paying and discharging the original account. He testified concerning what took place as follows: “Mr. Evans and Mr. Hammer came into my office. Mr. Hammer says to Mr. Evans, he says, ‘Sam has got more to do than he can take care of and if you will turn these goods over to me and take my note and turn these goods over to me I will give you my note and I can go out and sell them and I can- pay this whole deal.’ Mr. Evans says, ‘if Sam will endorse these notes I will turn over the goods to you and take your note.’ I said no, that I didn’t want to have any more dealings with the company, I wanted to be through. Mr. Evans says, ‘Unless you guarantee these notes we cannot give your account credit but if you will endorse these notes we will credit your account, or we will release you’ — didn’t say credit, ‘we will release you from this obligation.’ I then said I would do so.” Hammer testified concerning the same matter as follows: “Well, I .told Mr. Marshall that Mr. Evans was here now to make a settlement and- clean up on this deal and I was going to. take the stuff over, and Mr/ Marshall says all right, and Mr: Evans told him, he says, ‘You will have to sign those papers or I can’t release you.’Mr. Marshall refused to do so at different times and fin-ally Mr. Evans told him again that he would have to. sign-those notes if he wanted to be released from it and so in the course of time Mr.Marshall did sign those papers.” This testimony stands undisputed and unexplained. It shows that defendant was induced to indorse the notes in order tó be released from something. The only claim or obligation of any sort, existing against him, disclosed by the record, was the claim of plaintiff for the balance due on this account. We think that the evidence was sufficient to make the question whether these notes were given and accepted for the purpose and with the intention of releasing defend [239] ant from liability for the original debt a question of fact for tbe jury, and that it should have been submitted to them. Order reversed.