Etscheid v. Baker

Cassoday, C. J. The principal difficulty we have experienced in deciding this case has arisen from the ambiguous, if not inconsistent, language employed in the “ whereases ” or recitals contained in the bond, set forth in full in the foregoing statement. To ascertain the true meaning of such language, regard should be had to the relation of the parties named and the object or purpose to be secured by the parents in giving the deed of the farm to the defendant and taking back from him the bond and mortgage. There is no dispute but that at the time of the execution of the conveyance, August 27, 1883, the farm was worth $5,000, and that the defendant was to pay that amount for it. He claims that he did secure the payment of $1,000 of that amount at the time he received the deed by giving to the plaintiff his two notes of $500 each, which he paid a few months after-wards. The remaining $4,000 was to draw interest at the rate of seven per cent, per annum, payable semi-annually to the parents and to the survivor of them. Such payments of interest amounted to $140 every six months, or $280 a year. No part of the principal sum was to be paid until five years after the date of the bond; and then $2,000 of the principal sum was to be paid to the parents and to the survivor of them. No part of the other $2,000 of the principal sum was to be paid until after the death of both parents ; and the $1,000 of that amount here in question was [135] to be paid to the daughter Augusta “ within one year after the decease of both ” parents; and the other $1,000 of the principal sum was to be retained by the defendant and his wife, the other daughter, Ida. It is true the provisions for such payments are followed in the bond by a statement to the effect that it was “distinctly agreed and understood that in case one of the ” parents “ should die the survivor ” should “ be entitled to receive and receipt for the whole of the interest and principal.” The last two words appear to have been interlined after the bond was written and before it was signed. Of course, when the bond was executed, either of the parents was liable to die within the five years; and so, in view of the language of the bond, we are constrained to hold that the words “and principal,” so interlined, refer to the principal sum of $2,000, which was to become due at the end of five years. This givds effect to all the words employed. True, the bond was for $5,000, and ran to Gottlieb and Anna, and contained a statement that the defendant “agreed to pay to them ” $4,000, and semi-annual interest thereon at the rate of seven per cent, per an-num; but such statement is immediately followed by an explanation that the principal was “ to be paid as follows, to wit, $2,000 within five years from the date thereof,. $1,000 within one year after ” the death of both parents “to their daughter Augusta,” and the remaining $1,000 was to be retained by the defendant and his wife. There is no pretense that the $1,000 for which the defendant gave the two' notes of $500 each to the plaintiff was to be paid to the parents, nor that the principal sum of the $1,000 which was to be retained by the defendant and his wife was ever to be paid to the parents, or either of them. It seems to be equally clear from the wording of the bond that there was no intention that the principal sum of $1,000 which the defendant thereby so agreed to pay to Augusta should' ever be paid to the parents, or either of them. [136] The defendant ivas allowed, against objection, to testify in his own behalf to the effect that he had paid to Gottlieb “in his lifetime the full $4,000 called for by the’mortgage.” Assuming the competency of such testimony, yet he testified that his first payment was $200; that his nest payment was $800; that he next paid him $600; then $400; then $1,500; and then he gave him a note for $500, which he paid. But he further testified that the indorsements were made on the mortgage by himself. Turning to those indorsements, we first find: “May 27, 1889, paid $200, the interest called for the jmar 1889.” We next find: “ Paid on mortgage, Nov. 7, 1889, $800.” We next find: “ $2,000 paid on this mortgage, 1890. This is all paid on this mortgage.” The release of the mortgage was executed November 1, 1889. The only indorsement on the mortgage prior to such release was for interest. The other indorsements were confessedly made subsequent to such release. In fact, the defendant so testified. It is safe to say that he never made any payment not so indorsed. When we remember that the interest on the $4,000 up to the time of such release amounted to more than $1,700, it is manifest from the defendant’s own testimony that he never paid to Gottlieb the $1,000 which by the terms of the bond he had agreed to pay to Augusta. The question recurs whether the defendant is to escape such payment by reason of such release of the mortgage. Gottlieb never surrendered the bond to the defendant. The manifest purpose of the parents, as disclosed in the transaction, was to secure to themselves, in addition to the wood mentioned in the bond, a stated income, to be paid to them and the survivor of them, semi-annually, so long as either of them lived, and $2,000 of the principal sum at the expiration of five years from the date of the bond; and that the balance of the $5,000 consideration of the farm should go in the manner indicated to their two daughters and their husbands, respectively. Counsel contends that, if the $1,000 [137] which the defendant so agreed to pay to Augusta was intended as a gift from her parents, yet there is no evidence that it was in fact ever delivered to her, nor that she ever accepted the same. The bond was mostly to secure benefits to the parents during their lives and the life of the survivor of them. Augusta could claim nothing under the bond until a year after the death of both of her parents. It is not a question of gift by delivery, but a question of the obligations of a contract. “ It is the settled law of this state that when one person, for a valuable consideration, engages with another (whether by simple contract or by covenant under seal) to do some act for the benefit of a third person, the latter may maintain an action against the- promisor for breach of the engagement. After knowledge of and assent to such engagement by the person for whose benefit it is made, his right of action on it cannot be affected by a rescission- of the agreement by the immediate parties thereto.” Bassett v. Hughes, 43 Wis. 319. See, also, Grant v. Diebold S. & L. Co. 77 Wis. 75; Fulmer v. Wightman, 87 Wis. 573; Enos v. Sanger, 96 Wis. 150; Stites v. Thompson, 98 Wis. 331; New York L. Ins. Co. v. Hamlin, 100 Wis. 23; Kuhl v. C. & N. W. R. Co. 101 Wis. 56; Lessel v. Zillmer, 105 Wis. 338. There is evidence that Augusta and the plaintiff knew that the agreement between the defendant and the parents had been made, and that she assented to the agreement, as found by the court. The propositions stated are peculiarly applicable to the case at bar. The defendant took a conveyance of the farm, and agreed to pay the $1,000 in question as a part of the purchase price. He never paid it, nor any part of it; certainly not to Augusta, nor to anyone acting for'her. The release mentioned did not discharge the defendant from such obligation, and is no defense. Besides, under the rule of law stated and the fact found, Gottlieb had no authority to discharge the defendant from such liability to Augusta. By the Court.— The judgment of the circuit court is affirmed.