Citizens' State Bank of Sandpoint v. Thomason

• Decision Date: 16 June 1917
• Citation: 30 Idaho 460,167 P. 22
• Parties: CITIZENS' STATE BANK OF SANDPOINT, a Corporation, Appellant, v. HEGBERT E. THOMASON, Respondent
• Court: Idaho Supreme Court

167 P. 22

30 Idaho 460

CITIZENS' STATE BANK OF SANDPOINT, a Corporation, Appellant, v. HEGBERT E. THOMASON, Respondent

Supreme Court of Idaho

June 16, 1917

PROMISSORY NOTE-CONDITIONAL DELIVERY-EVIDENCE.

1. Evidence examined and held insufficient to establish respondent's claim that there was a conditional delivery of the note.

2. Evidence examined and held sufficient to establish that the note was delivered as a present obligation.

[As to the necessity that a note, in order to be negotiable, shall be an unconditional promise to pay, see note in 42 Am.Rep 366]

APPEAL from the District Court of the Eighth Judicial District, for Bonner County. Hon. R. N. Dunn, Judge.

Action on promissory note. Judgment for defendant. Reversed.

Judgment reversed. Costs awarded to appellant. Petition for rehearing denied.

H. H Taylor, for Appellant.

Parol agreements, varying the terms of the subscription to stock and the note such as testified to by the respondent are inadmissible. (American Gas etc. Co. v. Wood, 90 Me. 516, 38 A. 548, 43 L. R. A. 449, and notes; Hurt v. Ford, 142 Mo. 283, 44 S.W. 228, 41 L. R. A. 823; Williams v. Mt. Hood Ry. etc. Co., 57 Ore. 251, Ann. Cas. 1913A, 177, 110 P. 490, 111 P. 17; Shriner v. Meyer, 171 Ala. 112, Ann. Cas. 1913A, 1103, 55 So. 156; Loomis v. New York Central etc. R. Co., 203 N.Y. 359, Ann. Cas. 1913A, 928, 96 N.E. 748.)

Whether respondent contends that Selzer & Taylor were principals or agents of the Western States Life Insurance Co., a conditional or contingent delivery could not be made to them as principals or agents as it would become an absolute delivery. (3 R. C. L. 860, 861, 862.)

While a conditional delivery may be shown as between the original parties, parol evidence cannot be introduced to show a conditional delivery except as between the original parties. (Burke v. Dulaney, 153 U.S. 228, 14 S.Ct. 816, 38 L.Ed. 700; note, 3 Ann. Cas. 561.)

Evidence of oral agreements made prior to the signing of a note and subscription such as this is not admissible to vary the terms of the written agreement, and the note and subscription taken together constitute the written agreement herein. (Fralick v. Mercer, 27 Idaho 360, 148 P. 906; Smith v. Wallace National Bank, 27 Idaho 441, 150 P. 21.)

G. H. Martin, for Respondent.

An instrument may be delivered to the payee on condition, the observance of which is essential to its validity. (Rev. Codes, sec. 3473; 3 R. C. L. 863, and cases there cited, Beach v. Nevins, 162 F. 129, 89 C. C. A. 129, 18 L. R. A., N. S., 288; Burke v. Dulaney, 153 U.S. 228, 14 S.Ct. 816, 38 L.Ed. 700; McFarland v. Sikes, 54 Conn. 250, 1 Am. St. 111, 7 A. 408.)

Evidence is properly received that a note executed because of a certain agreement between the payee and maker that until certain acts were done, the transaction should not be deemed completed and the note enforceable. (Hughes v. Crooker, 128 Am. St. 611, 612, note.)

By contemporaneous parol agreements, it may be shown that a note executed and delivered is not to be enforced as a present contract, as a defense to a suit upon the note. (Faux v. Fitler, 223 Pa. 568, 132 Am. St. 742, 72 A. 891; Kessler v. Parelius, 107 Minn. 224, 131 Am. St. 459, 119 N.W. 1069; Gandy v. Weckerly, 220 Pa. 285, 123 Am. St. 691, 69 A. 858, 18 L. R. A., N. S., 434; Carroll v. Nodine, 41 Ore. 412, 93 Am. St. 743, 69 P. 51; Citizens' Bank v. Millett, 103 Ky. 1, 82 Am. St. 546, 44 S.W. 366, 44 L. R. A. 664; Sloan v. Gibbes, 56 S.C. 480, 76 Am. St. 559, 35 S.E. 408; Jones on Evidence, 2d ed., secs. 471-495; Ware v. Allen, 128 U.S. 590, 9 S.Ct. 174, 32 L.Ed. 563; Smith v. Dotterweich, 200 N.Y. 299, 93 N.E. 985, 33 L. R. A., N. S., 892: Benton v. Martin, 52 N.Y. 570.)

RICE, J. Budge, C. J., and Morgan, J., concur.

OPINION

RICE, J.

This is an action upon a promissory note in the sum of $ 2,500, executed by Hegbert E. Thomason, respondent herein, payable to himself and indorsed and delivered by him to Selzer & Taylor, who subsequently indorsed and delivered the note to the appellant herein.

The respondent denied that the note was executed and delivered unconditionally for value. As an affirmative defense respondent alleged that prior to the signing, indorsing and delivery of the note, said Selzer & Taylor agreed to and with him that they had for sale and delivery certain shares of the capital stock of a corporation known as the Western States Life Insurance Company, and that they offered to sell to respondent one hundred shares thereof for $ 2,500; that respondent advised them that if he should make a prospective sale of certain mining properties located at Jarbridge, Nev he would purchase one hundred shares of said stock at $ 25 per share; that he would execute and deliver the note in suit in this case upon condition that the purchase of said stock and execution and delivery of said note therefor should not be treated or deemed as a present contract; that if said mining deal at Jarbridge, Nev., fell through, this respondent should not be required to take said stock and pay therefor, and that if at any time prior to the maturity thereof the respondent desired to withdraw from the purchase of said stock and the payment therefor as evidenced by said note, the respondent should notify Selzer & Taylor to that effect, and that respondent's agreement to purchase said stock should not thereafter be enforceable, but should be canceled and said note returned to him. Respondent further alleged that the mining deal on the Jarbridge property fell through; whereupon he elected not to complete the purchase of said stock, nor to take the same...