Moore v. McHaney

ALLEN, J. This is an action begun before a justice of the peace to recover from defendant the amount remaining unpaid on a certain note executed by one Hodge to plaintiff. It is averred that defendant, for a valuable consideration, “and for the purpose of extending the time of payment of said note, ’ ’ contracted to pay the unpaid balance due upon the note, and paid fifty dollars on account thereof, leaving a balance of $129.30 due and unpaid thereupon; and judgment is prayed for said sum with costs. Plaintiff prevailed before the justice of the peace, and upon defendant’s appeal to the circuit court and a trial there de novo, before the court and a jury, there was a verdict -and judgment for plaintiff, and the case is here on defendant’s appeal. One J. B. Hodge was indebted to plaintiff upon a promissory note theretofore executed by him and secured by a chattel mortgage upon a team of mules which he had purchased from plaintiff. Hodge went to work for the defendant, McHaney, apparently early in 1911, using this team of mules in clearing land, building fences and doing other work upon defendant’s property. The note to plaintiff was then overdue, and Hodge testified that when defendant asked him to come upon defendant’s place to do this work he told defendant that he would do so if defendant would “go on” — 691 — this note; that defendant did not agree to do so and later, about April, 1911, the witness told defendant that plaintiff was demanding’ the mules, and that he (Hodge) had written plaintiff to come and get them; that nothing further was said until a little later when defendant told the witness that he had seen plaintiff and had paid the latter $50 on the note and “guaranteed the balance.” The $50 thus paid by defendant was money which defendant then owed Hodge. There is no dispute as to the fact that defendant met plaintiff in “Shelton’s store” — evidently in April, 1911 — paid plaintiff the $50 on the note, and made some further agreement regarding the payment of the balance then remaining due thereon. There is some conflict in the testimony as to just what was the oral agreement respecting the payment of the balance on the note. Plaintiff testified: “We agreed in Shelton’s store that if I would take $50 and leave the team alone that he would pay it (the note) and I taken him for it.” Q. “He agreed to pay $50 on the note?” A. “Yes, sir.” Q. “And did at that time? ” A. “Yes, sir.” Q. “And agreed to pay the rest?” A. “Yes, sir.” Q. “Did you look to Hodge after that for the money?” A. “No, sir, I never did ask Hodge for a nickel.” . . . Q. “And that was the contract between you and McHaney that Hodge was to keep the mules and that he (McHaney) was to pay for them?” A. “Yes, sir, that was the understanding, that he was to pay me this $50 and me not bother the mules.” On cross-examination plaintiff said that defendant agreed “that he would pay the note or deliver the mules —to pay the money or return the mules.” He denied, however, that defendant had only promised to see that Hodge paid the debt, saying: “He promised to pay me.” Two witnesses present at the time of the oral agreement in question both testified that McHaney — 692 — agreed to pay the $50 and to pay the balance on the note some time “in the fall,” and that in consideration thereof plaintiff agreed not to take possession of the mules “until fall.” Defendant’s testimony is that plaintiff, at the time in question, asked him to sign the note and that he refused to do so; that he paid plaintiff the'$50', and said: “I will guarantee that you will not be put to any trouble — if old man Hodge doesn’t make a good crop I will guarantee that you will have your money or get your mules.” It appears that some time in the latter part of this same year one of the mules died. Thereafter Hodge took the other mule to plaintiff who told him to take it to defendant who had agreed to be responsible for the debt. Hodge did this, but defendant denied any responsibility in the matter and directed Hodge to deliver the mule to plaintiff. Thereupon the mule was turned over to plaintiff at an agreed valuation which was credited upon the note. The jury, upon instructions to be hereafter noticed, returned a verdict for plaintiff in the sum of $140.32, being the amount remaining unpaid on the note, with accrued interest thereupon; and judgment was accordingly entered for this amount. I. After the cause reached the circuit court, plaintiff was permitted to file an amended petition. It is argued that the original statement filed before the justice of the peace stated no cause of action, and that it could not be amended in the circuit court. But it is quite clear that the original statement was sufficient as a statement of a cause of action before a justice of the peace, for it sufficiently advised the defendant of the nature of the claim asserted against him, and was so far specific and definite as to bar another action upon the same demand. [See Rundelman v. Boiler Works Co., 178 Mo. App. l. c. 647, 161 S. W. 609.] It is there — 693 — fore unnecessary to further discuss this assignment of error. II. It is urged that the demurrer to the evidence interposed by defendant should have been sustained. Appellant contends that under the evidence adduced the oral agreement upon which defendant is here sought to be held liable is a collateral undertaking to pay the debt of another and within the Statute of Frauds. ■This Question was raised below and is pressed upon us here. Our statute (Section 2783> Revised Statutes 1909), which follows substantially the English Statute of Frauds and Perjuries, provides that no action shall be brought ... to charge any person upon any special promise to answer for the debt, default or miscarriage of another . . . unless the agreement upon which the action shall be brought, or some memorandum or note thereof, shall be in writing and signed by the party to be charged therewith or some other person by him thereto lawfully authorized. ’ ’ From the time of the early decisions under the English statute there has been quite a contrariety of opinion as to what oral contracts fall within the statute. It is well settled that it is not every oral agreement which may in terms provide for or involve the payment of a debt of another that comes under the ban of the statute and is thereby rendered invalid. Where the promisor, who is sought to be held liable upon an oral agreement, agrees with the creditor to assume and pay the debt of a third person, and the original debtor is fully released and discharged therefrom, the contract is not one within the statute, and is valid though not in writing. In such case the original debt is gone and a new one is created with the promisor as a substituted debtor. [See Beall v. Board of Trade, 164 Mo. App. 186, 148 S. W. 396; Martin v. Harrington, 147 Mo. App. l. c. 711, 712, 161 S. W. — 694 — 275, and authorities cited.] But it does not here appear that -Hodge, the original debtor, was released and discharged. It is true that plaintiff testified that after the making by defendant of the oral promise in question he no longer looked to Hodgie and made no further demands upon him. And plaintiff says of defendant: “I taken him for it.” However, it nowhere appears-that any steps were taken whereby to release Hodge. His liability on the note continued to exist, though plaintiff did not see fit to attempt to enforce it. It is also true that where one undertakes to pay the debt of another and by the same act also pays his own debt, which is the motive for the promise, the undertaking is not one within the Statute of Frauds and need not he in writing. [See Dobyns v. Rice, 22 Mo. App. 448; Besshears v. Rowe, 46 Mo. 501; Browne, Statute of Frauds (5 Ed.), sec. 188.] But in the case before us it does not appear that the undertaking was to pay a debt of defendant, aside from the fifty dollars actually paid, except in so far as defendant may be said to have made the debt his own by the agreement in question. Neither is an oral agreement within the statute where the promise is not-made to the creditor but to the debtor or some other person. In'such case the agrees ment, if founded upon a valid consideration, is an independent undertaking not affected by the statute. [See Brown v. Brown, 47 Mo. 130; Green v. Estes, 82 Mo. 337; Hedden v. Schneblin, 126 Mo. App. l. c. 485, 104 S. W. 887; Boone County Lumber Co. v. Niedermeyer, 187 Mo. App. 180, 173 S. W. 57. See, also, Van Meter v. Poole, 130 Mo. App. 433, 110 S. W. 5; Citizens Bank of Senath v. Douglas, 178 Mo. App. 664, 161 S. W. 601; Nelson v. Brown, 140 Mo. l. c. 588, 41 S. W. 960.] The contract here relied upon, however, was one made with plaintiff, the creditor. No express promise to Hodge on the part of defendant appears, though Hodge had sought to have defendant sign the — 695 — note and later knew that defendant had paid plaintiff the fifty dollars and had made an agreement with plaintiff respecting the payment of the balance of the note, by virtue of which agreement the mules were to remain in Hodge’s possession. The statute renders invalid only an oral promise to answer for the debt, default or miscarriage of another. Where the agreement is essentially an original undertaking on the part of the promisor to pay a debt which he makes his own, as distinguished from a collateral promise to answer for the debt of another, the contract is not invalidated by the statute. [See Stokes v. Mills, 171 Mo. App. 638, 154 S. W. 455; Haynes v. Johnson, 141 Mo. App. 506, 126 S. W. 177; Steele v. Ancient Order of Pyramids, 125 Mo. App. 680, 103 S. W. 108.] And though there is some conflict and confusion in the cases treating of the precise question, there is ample authority in support of the doctrine that a direct and unqualified promise to pay the debt of another, though the primary debt still subsists, is to be regarded as original in character and unaffected by the statute when the promise is founded upon a new and independent consideration moving to the promisor and beneficial to him, and which is the motive therefor. It is so held in Martin v. Harrington, supra, where in an opinion by Eluison, J., the matter is discussed somewhat at length. Our courts have substantially followed the rules enunciated by Chancellor Kent in the leading case of Leonard v. Vredenburgh, 8 Johns 29, respecting the matter in hand. [See Peck v. Harris, 57 Mo. App. l. c. 470.] The third class of cases there referred to, and which are held not to be within the statute, are said to be cases “when the promise to pay the debt of another arises out of some new and original consideration of benefit or harm moving between the newly contracting parties. ’ ’ But it has been more than once observed that this language, taken as a working rule, — 696 — ■would mean that any independent consideration for such a promise would suffice to take the contract out of the statute. If there is no present consideration for the promise it is a mere nudum pactum and unenforcible regardless of the statute. The purpose of the statute is to render certain contracts invalid, if not in writing, which would otherwise have been valid. [See Martin v. Harrington, supra.] In White v. Rentoul, 108 N. Y. 222, it is said that this statement in Leonard v. Yredenburgh is “dangerously broad and capable of grave misapprehension.” But where the promise is in terms an absolute promise to pay the debt, and the new consideration is one of benefit to the promisor, which is the motive for the making thereof, it seems that the case may properly be held to be taken out of the operation of the statute. In such event the undertaking is independent in character, and founded upon the special 'benefits accruing thereby to the promisor. This is the doctrine of Nelson v. Boynton, 3 Met. 396, where the rule derived from the earlier cases was stated by Chief Justice Shaw (l. c. 402). It was adopted by this court in the early case of Walther v. Merrill, 6 Mo. App. 370, in an opinion by Bakewell, J. It does not appear that our Supreme Court has in terms so stated the rule, but, as pointed out by Judge Ellison, in Martin v. Harrington, supra, it is in effect the view reflected in Besshears v. Rowe, 46 Mo. 501. In this connection see Kansas City Sewer Pipe Co. v. Smith, 36 Mo. App. 608; Browne, Statute of Frauds (5 Ed.), sec. 212 et seq. In the case before us defendant’s promise was made in consideration that plaintiff would not take the mules from the possession of defendant’s employee, who was using them for defendant, for some months. It distinctly appears that this was of benefit to defendant, and that it was the motive for Ms promise; that his object was to promote Ms own interest, and not merely to relieve Hodge from the obligation in question. We — 697 — are of the opinion that the agreement was valid, under the circumstances, though not in writing, and that defendant should be required to respond thereupon. Furthermore the contract made between plaintiff and defendant, based upon the new consideration aforesaid, was fully performed on the part of plaintiff. The evidence discloses that plaintiff, in reliance upon defendant’s promise, refrained from taking possession of tiie mules in accordance with his agreement. Our courts have repeatedly held that “complete performance of a contract by one contracting party forecloses his adversary from interposing the Statute of Frauds as his defense.” [See Hedden v. Schneblin, 126 Mo. App. l. c. 485, 104 S. W. 887; Chenoweth v. Express Co., 93 Mo. App. 185; Johnson v. Reading, 36 Mo. App. l. c. 315, affirmed in Nally, Admr. v. Reading, 107 Mo. 350, 17 S. W. 978; Bless v. Jenkins, 129 Mo. l. c. 657, 31 S. W. 938; Hale v. Stuart, 76 Mo. 20.] The agreement was either to pay the debt or cause the mules to be returned to plaintiff, according to the l&tter’s testimony. But this was an undertaking to pay the balance due upon the note, either in cash or in property to be accepted in payment thereof. No point is made respecting the valuation placed upon the mule delivered to plaintiff, which amount was credited upon the note; and this phase of the matter need not be noticed. Appellant complains of the one instruction given at plaintiff’s request, for the reason that it required the jury to find, among other things, that in consideration of defendant’s promise plaintiff released Hodge and in his stead accepted defendant as the debtor, defendant consenting thereto; and that the evidence did not support this part of the instruction. But in this the instruction merely required the jury to find more than was essential to plaintiff’s recovery. Furthermore an instruction given at defendant’s request proceeds along precisely the same lines, and defendant is not in a posi — 698 — tion to complain of plaintiff’s instruction. The instruction assailed does require the jury to find that “the said promise of J. O. McHaney (if made) was in consideration of some benefits accuring directly to him. ’ ’ Plaintiff’s instruction told the jury that if they found for plaintiff their verdict should be for the sum of $140.32; this being the amount'remaining unpaid upon the note with interest computed thereupon. It is argued that the court committed reversible error in computing the interest and thus instructing the jury as to the amount of the recovery. Such was formerly the rule of decision in this State, but in the recent case of McCormick Harvesting Machine Co. v. Blair, 181 Mo. App. 593, 164 S. W. 656, we held to the contrary, following the decision of the Supreme Court in Beekman Lumber Co. v. Havester Co., 215 Mo. 221, 114 S. W. 1087. However, it does appear that plaintiff did not pray for interest upon the balance alleged to be due upon the note. The prayer is for judgment for $129.30, the amount alleged to be due and unpaid, with costs. Plaintiff cannot recover more than the amount for which he sues. The evidence authorizes a recovery of $129.30,-but no interest may fie added thereto. If plaintiff within ten days will remit the sum of $11.02 the judgment below will be affirmed; otherwise’ it will be reversed and the cause remanded. Reynolds, P. J., and Nortoni, J., concur.