Byrum v. Barnes

• Decision Date: 25 March 1880
• Docket Number: CASE No. 850.
• Citation: 13 S.C. 328
• Court: South Carolina Supreme Court
• Parties: MCGRATH & BYRUM v. BARNES.

13 S.C. 328

MCGRATH & BYRUM

v.BARNES.

CASE No. 850.

Supreme Court of South Carolina.

Mar. 25th, 1880.

1. Where an executor gave his promissory note for the payment of money which was expressed to be the amount due by his testator's estate to the payee “for medical services rendered, most of which during last illness,” parol evidence of a contemporaneous agreement that the note was to be paid only upon a certain condition, is incompetent.

2. When parol evidence may be received to show a verbal agreement not expressed in a note, considered; and cases reviewed.

3. When and to what extent an executor is personally bound by his written promise to pay a debt of his testator, considered; and cases reviewed.

4. Such promise, when based upon the possession of assets and his duty to pay, without other consideration, is binding only to the extent of the amount actually due by testator.

5. Though the debt due by testator at the time the executor qualified had become barred by the statute of limitations at the date of the written promise to pay, it will be supported as a good consideration for such promise.

Before FRASER, J., Anderson, February, 1879.

This was an action commenced in April, 1877, by the plaintiffs against James T. Barnes, to charge him personally with the payment of the note set out in the opinion of the court. Plaintiffs had purchased the note from H. H. Scudday, for valuable consideration some time after its maturity. The defence was that the defendant gave the note as executor of C. V. Barnes for balance struck upon a settlement of mutual accounts between Scudday and C. V. Barnes, upon express condition that any other accounts afterwards discovered, should be credited; and if the voucher should not be approved by the judge of Probate, this note or memorandum was to be given up or destroyed; that Scudday should be notified of the time of trial before the Probate Court, so that he might appear and defend his accounts; that he was so notified but failed to appear, and the vouchers were disallowed. At the trial these matters were offered to be proved by parol testimony. Plaintiffs objected; their objections were overruled and they excepted.

Scudday's accounts were for the years 1855 to 1856, inclusive, and amounted to $550.50; due by Scudday to C. V. Barnes, $206.92, and to J. T. Barnes $70.28, leaving balance due to Scudday $273.30, for which the note was given June 26th, 1875. C. V. Barnes died in February, 1866; J. T. Barnes and C. V. Barnes, sons, qualified as executors within a month afterwards. August 19th, 1875, there was a balance in executors hands of $5925.65, of which $4595.36 was set aside to widow, to revert to the estate at her death; and adding the amounts already received by legatees, the sum of $203.80 was the share of each child. At this settlement the judge of Probate (sometimes called Ordinary) refused to allow J. T. Barnes credit for the notes.

The charge of the Circuit judge to the jury was as follows:

1. It is doubtful whether the note sued on was not nudum pactum, inasmuch as there was no consideration personal to the defendant.

2. That Scudday, the payee of the note or memorandum, and the defendant differed as to whether they had frequent conversations about the mutual claims in the long interval of time between 1866, when the testator died, and 1875, when the memorandum or note was signed by the defendant, one of the executors; but without charging them upon this issue of this fact, or giving any intimation of opinion upon the subject, he charged as matter of law, substantially, that even if such conversations as Scudday claimed had taken place, and there were promises to pay the balance, (which defendant denied,) yet these conversations were merely parol, and could not, after the adoption of the code in March, 1870, have the effect of keeping the original debt alive longer than four years after that time, and that on June 26th, 1875, when the memorandum or note sued on was signed, the original claim on the accounts was barred, and the right of action gone.

3. That at that time the original claim being barred, one of the executors could not, even by contract in writing, make a new debt to bind the estate. That an individual who owes a debt, which becomes barred, may make a new debt of his own by a new promise in writing, (the old debt being the consideration of the new promise,) but that as to a debt against a dead man's estate, when the right of action against the executors is clearly barred, the executor cannot make a new debt against the estate by a new promise. It is not like the promise of an individual to make a new debt with sufficient consideration against himself, but is unauthorized, without consideration, and nudum pactum. It is true the estate was said to be solvent, but it did not follow that Barnes, the executor, had any interest in it. The estate may have been given to others, or the defendant may have been fully advanced. There was absolutely nothing to show that the executor had any interest in the estate, and it could not be assumed.

The jury found for the defendant.

The plaintiffs appealed, alleging error in the admission of the parol testimony and in the charge to the jury.

Mr. J. W. Harrison, for appellants.

1. That the court erred in admitting parol testimony to vary the terms of the written contract. 1 Bay 303; 2 M. Const. R. 31; Id. 265; Harp. 401; 3 McC. 469; 6 Ves. 327, and notes; 2 E. C. L. R. 427; 5 E. C. L. R. 268; 2 Strob. 122;4 Strob. 99;8 Rich. 407;9 Rich. 50;12 Rich. 31.

2. That the court erred in charging that on June 26th, 1875, the original claim on the account was barred. 7 Wait's Act. & Def. 266; 3 Strob. 196;4 Strob. 67;Hays v. Clinkscales, (not reported;) 14 Eng. R. (Moake) 304-326; 3 Hill 16;Dud. 121.

3. That the court erred in charging that the debt being barred, one of the executors could not, even by contract in writing, make a new debt to bind the estate. 13 Am. R. 417, and authorities referred to.

Mr. S. McGowan, contra.

Mr. A. T. Broyles, in reply.

The opinion of the court was delivered by

WILLARD, C. J.

The action was upon the following promissory note:

“$273.30.

ANDERSON, S. C., January 26th, 1875.

“One day after date, I promise, as the executor of the estate of C. V. Barnes, to pay H. H. Scudday, or bearer, the sum of two hundred and seventy-three 30-100 dollars, due by said estate to H. H. Scudday for medical service rendered, most of which during last illness.

(Signed,)

“JAS. T. BARNES, Executor.”

Evidence was admitted, subject to objection, tending to show that the note was given in pursuance of an agreement that the payment of the note should be conditional upon the allowance by the Ordinary of the claim made against the estate by the payee of the note. The objection urged was that the admission of this testimony violated the rule that written instruments cannot be varied by oral testimony.

It appears to be well settled in this state, that in an action on a promissory note between parties affected by the rights and equites existing between the original parties to the note, where the note does not state the consideration upon which it was given, or where only a general consideration is stated, such as value received, it is competent to prove in defence that the note was given as part of an agreement by which the payment was to be conditional instead of absolute, and such agreement, when it appears to have been the consideration of such note, may be resisted to show either partial or entire failure of consideration on which the note was made.

That promissory notes and other obligations for the payment of money absolutely are frequently given upon considerations of an expectant character, as upon contracts, calling for acts to be performed by the party to whom the note is given, and are put in an absolute form for the convenience of the parties, is a fact well known. When a party gives his note upon the promise of the payee to perform a certain act, and the payee fails to perform, it is reasonable that the transaction should be considered as a whole for the purpose of ascertaining what is due between the parties. This cannot be done where a negotiable note has come into the hands of one who is not affected by the rights and equities existing between the original parties independently of the terms of the note itself; as where held by a purchaser before maturity without notice. The question is, whether such a defence to a promissory note is sanctioned by the principles of law and the adjudicated cases.

The principle upon which such evidence has been admitted seems to be this: That a promissory note as between the original parties to it, unless supported by a consideration, is nudum pactum. Bank v. Topping, 9 Wend. 273. Here arises the propriety of inquiring whether such a consideration existed. When the note states the consideration specifically, it may well be said that, to admit oral testimony to show a different consideration, is, in effect, to vary the terms of the written instrument by oral proof. McClenaghan v. Hines, 2 Strob. 122, is a case of this class. In that case, according to the express terms of the note, the payer promised to pay the amount due upon the notes of a third party belonging to the payee. The court held that an attempt to show by parol proof that the maker merely promised to take in hand the collection of such notes and to pay over only what was collected therein, was an attempt to change the contract as it appeared on the face of the note, and, therefore, inadmissible under the rule that precluded the alteration of the terms of written instruments by parol. But when the note expresses no consideration or a merely formal or general consideration, as by the usual words value received, or by similar general or formal expressions, it is evident that if the true consideration of the note rests in an agreement, written or oral, between the parties, the proof of such agreement does not...