Lindsay Bros. v. Montgomery

MR. JUSTICE GALEN delivered the opinion of the court. This is an action upon a promissory note for $4,000, executed by the defendants in part settlement for certain plows and machinery purchased by the defendants from the plaintiff under a conditional sales contract. The defendants interposed the defense of want of consideration; otherwise the allegations of plaintiff’s complaint, save as to allowance of attorney’s fees, are admitted. At the close of the trial, which was had before a jury, both parties moved for a directed verdict, and the cause was by the court taken from the jury with the consent of counsel. Thereafter the court made certain findings of fact and conclusions of law in the defendants’ favor, upon which judgment was duly entered dismissing the action, costs being taxed against the plaintiff. The appeal is from the judgment. The question determinative of this appeal is whether there was consideration for the note. There is no dispute as to the facts. It appears that the defendants were engaged in the business of retailing farm implements and machinery at Great Falls, and that the note sued upon was one of four executed by the defendants, aggregating a total of $8,276.62, in settlement for twenty-one plows, 150 disc blades, and 'other machinery consigned by the plaintiff to the defendants under a conditional sales contract whereby title and right of possession of the goods were to remain with the plaintiff until fully paid for. Written order for the plows and machinery was given by the defendants to the plaintiff November 26, 1919, on the back of which the terms [298] of sale were incorporated in contract form. Shipment of the goods was made May. 23, 1920, and they were duly received by the defendants, ivho in regular course of business disposed of a portion thereof. On November 1, 1920, the parties had a settlement of account, and the note in suit, together with the other three notes, were then executed by the defendants to cover the aggregate amount on that date agreed to be due and owing to the plaintiff on account. The notes so executed not having been paid, on December 21, 1921, the plaintiff herein instituted an action in claim and delivery against the defendants to recover therein a portion of the property consigned to the defendants. Certain of the property was retaken in that action, and thereafter the plaintiff gave credit to the defendants on the other three notes for the value of the property so recovered, and instituted the present action on April 21, 1922. The trial court found as facts that the defendants executed the note, together with the other three notes, in settlement of the purchase price of the plows under the terms of the contract of sale, and made default in payment of all of the notes, although they had disposed of seven of the plows up to December 20, 1921, and had only fourteen thereof on hand at that time. Farther, that under the terms of the contract of sale the plaintiff took possession of the remaining fourteen plows, and gave the defendants credit therefor to the full amount of the other three notes. In our opinion these findings of fact do not support the court’s conclusion and judgment in defendants’ favor. Defendants cite and rely upon the ease of Madison River Live Stock Co. v. Osler, 39 Mont. 244, 133 Am. St. Rep. 558, 102 Pac. 325, but in our opinion it is without application to the present case. The Osier Case merely dealt with a vendor’s remedy for alleged breach of contract on sale of certain cattle, horses and harness. It appeared therein that the plaintiff [299] took possession of all of the property sold, save a few head of cattle which had died during the winter, and long before the notes given in payment for the property were due. The jury found that the property was wrongfully retaken from the vendee’s possession, and it was there held by this court, and properly so under the facts, that the plaintiff could not thus retake the property sold, renounce the contract of sale, and at the same time insist upon payment under the contract. Here we have a different situation. There is no rescission of the contract; the plaintiff merely insisting on its right of recovery thereon. It is admitted that the defendants bought and received the goods sold to them by plaintiff, that the note in suit was executed in payment thereof, that no part of it has been paid, and that defendants have sold and retained a portion of the property consigned to them by the plaintiff. Had the defendants shown that plaintiff rescinded the contract of sale and wrongfully took possession of all of the property sold as alleged in their answer, there would be merit in defendants’ contention. It would be a manifest injustice to permit the defendants to escape payment of their just and admittedly due indebtedness upon any such flimsy pretext. The absurdity of the defendants’ position is conclusively demonstrable upon its mere statement, insisting, as they do, upon their right to retain a portion of the goods consigned to them by the plaintiff, and avoid the payment therefor simply because some of the property sold and delivered to them by the plaintiff in consequence of defendants’ default in payment has been retaken and applied upon the defendants’ indebtedness; a unique and unheard-of method of liquidating such an obligation. To us it appears too plain to require further discussion or citation of authorities that a sufficient consideration existed for the execution of the note (sec. 7503, Rev. Codes 1921), and that the defendants are liable for the payment thereof. Rehearing denied September 11, 1923. The judgment is reversed, and the cause remanded to the district court of Cascade county, with directions to enter its judgment for the plaintiff. Reversed and remanded. Mr. Chief Justice Callaway and Associate Justices Cooper, Holloway and Stark concur.