Christian v. Newberry

• Decision Date: 31 October 1875
• Citation: 61 Mo. 446
• Parties: A. M. CHRISTIAN et al., Respondents, v. JNO. B. NEWBERRY, Appellant.
• Court: Missouri Supreme Court

61 Mo. 446

A. M. CHRISTIAN et al., Respondents,

v.JNO. B. NEWBERRY, Appellant.

Supreme Court of Missouri.

October Term, 1875.

Appeal from Bates Circuit Court.

Page & Holcomb, for Appellant.

A note given by a debtor for a pre-existing debt is no payment, unless the creditor expressly agrees to take it as payment, and to run the risk of its being paid. “Nothing is considered as an actual payment which is not in truth such.” (McDonald vs. Hulse, 16 Mo., 503; See also, Hil. Mortg., 4th ed., p. 476.)

Waldo P. Johnson, for Respondents.

There is in this case but one point, and that is, was the note given by Clary to French paid off and discharged by that given to Cowles? It was so found by the court, and that finding is abundantly sustained by the evidence.

HOUGH, Judge, delivered the opinion of the court.

This was a petition for an injunction to restrain the defendant from selling, as trustee, certain real estate which he had advertised for sale, in pursuance of the provisions of a trust deed, which, as was alleged, had been satisfied and extinguished by payment of the debt for which it was a security. A temporary injunction was granted, which was afterwards made perpetual by final decree, and defendant has appealed to this court.

On the 16th day of September, 1870, Zachariah Clary executed a trust deed for certain lands in Bates county, Mo., to secure the payment of a note for $448, dated September 10th, 1870, and payable to the order of John R. French, one year after date. This deed was recorded on the 10th of October, 1870, but was incorrectly copied, the recorder having omitted to transcribe the signatures of Clary and wife. The same deed was correctly recorded on the 25th of March, 1872.

The plaintiffs claim title to the land described in said trust deed, through an execution sale made on the 5th day of March, 1872, under a judgment rendered in the Bates circuit court against said Clary on the 13th day of September, 1871.

On the 27th day of September, 1871, Zachariah Clary executed another trust deed for the same land to secure the payment of a note for $525, bearing date on said 27th day of September, and payable in ninety days from its date to the order of M. S. Cowles, who, it appears from the testimony, was at that date cashier of the Bates county Savings Bank. This second deed and the note secured by it were made by Clary for the purpose of taking up the note to French, and the indebtedness created thereby was really an indebtedness to the bank, though the note was made payable to Cowles.

Clary testified as follows: “I borrowed the money at the Savings Bank in Butler, Bates county, Mo., to the amount, I think, of $500, and gave said Savings Bank my note, as near as I can remember, for the sum of $500, which I secured by deed of trust on the east half of the southeast quarter of section 8, in township 38, range 30, in the county of Bates, State of Missouri, for the purpose of redeeming my note held by John R. French for $448, which I applied to the purpose stated above, as follows: I left the money ($500) as before stated, prior to the 10th of September, 1871, at said Savings Bank, to liquidate my note held by said J. R. French. I instructed the said bankers to inform said French and A. C. Widdicombe (who was trustee), that the money was there subject to their order. French, (as Mr. Wilson of the bank told me), came and received the money, signing the notes, (as Mr. Wilson told me) over to said bankers. I have never received the note into my possession. The reason I did not receive the note was, the said bankers refused to deliver said note to me on account of doubts then existing as to the deed of trust, then on record, being good.”

M. S. Cowles testified for the defendant. The note to French for $448 having been shown to him, he said: “When I first saw this note, it belonged to Mr. John R. French. in September or October, 1871. I then bought it of him. We furnished the money, and bought of Mr. French, in person, this note, secured by deed of trust.” The second note having been shown to witness, he said: “This note was given to me personally by Mr. Clary. We loaned Clary the money on this note, so that he could pay off the note and deed of trust, and also for additional expenses. The first note was signed over to us by Mr. French. There was no conversation with Clary about the defect in the deed of trust. I supposed that it was correct. We learned of the defect first after Swift purchased at sheriff's sale. Clary was to pay off the notes to us. We held them by purchase from French. This note (the second) was written at the date therein mentioned. Also deed of trust dated same day was executed on that day; money, I don't think, was given to him then; French lived on the river; we furnished the money when Mr. French came, which was a few days after the note and deed of trust were written. I do not know when we commenced to make this discount; our books will show. We discounted notes of this kind at 1 1/2 per cent. per month at that time. The discount on note (second) was $23.60. This note was given to pay the first note, interest and expenses. When we get this note and interest paid by Clary, we will have no other claim on first note. The payment of second note liquidates the whole thing. I think the note was discounted October 6, 1871; the note was assigned to the bank October 6, 1871, by Mr. French in my presence. My impression is that Clary was present when French assigned the note. I think the money was paid October 6, 1871. We lifted the first note the same day the other was given; they both happened on same day. The reason that we held both notes was because the first note was given for purchase money. I do not know that this fact appeared upon the note or deed of trust.”

J. E. Wilson testified: “Mr. Clary wanted us to take up the note held by Mr. French. French had advertised the land, and Clary wanted to execute to us his note. Mr. French afterwards came in and agreed to sign the note without recourse. When the first conversation was held the note and deed of trust was dated, which was September 27, 1871, but was not signed till French came, which was October 6th. I think that Clary was not present when French assigned the note....