Cotner College v. Hester's Estate

• Decision Date: 08 February 1952
• Docket Number: No. 33031,33031
• Citation: 51 N.W.2d 612,155 Neb. 279
• Parties: COTNER COLLEGE v. HESTER'S ESTATE.
• Court: Nebraska Supreme Court

Page 612

51 N.W.2d 612

155 Neb. 279

COTNER COLLEGE v. HESTER'S ESTATE.

No. 33031.

Supreme Court of Nebraska.

Feb. 8, 1952.

Syllabus by the Court.

1. Findings of court in a law action in which a jury is waived have the effect of the verdict of a jury, and judgment thereon will not be disturbed unless clearly wrong.

2. Equitable estoppel is the effect of the voluntary admissions, representations, acts, or conduct of a party whereby he is absolutely precluded, both at law and in equity, from asserting rights which might have otherwise existed, either of property, or contract, or of remedy, as against another person who in good faith relied upon such conduct and has been led thereby to change his position for the worse, and who on his part acquired some corresponding right either of property, of contract, or of remedy.

3. General principles of estoppel apply in determining whether or not defendant, in an action on a promissory note between the original parties thereof, is estopped to defend upon the ground that there was a failure of consideration.

4. As between the parties thereto, the consideration for a subscription note is tested by the situation existing at the time it is sought to enforce the subscription.

5. In the absence of any stipulations upon the subject in terms of the subscription, the abandonment of a charitable or public enterprise releases the subscriber to its fund, the law implying that the enterprise must be existing when payment is demanded.

6. It is an implied condition of a subscription note that the money shall not be diverted from the purpose for which it was subscribed and that the enterprise shall not be abandoned.

7. The general principles governing the performance of contracts apply to subscriptions. If a material change in the plan or purpose for which a subscription is made is affected without the consent of the subscriber, he is excused from performing his promise unless estopped to deny his consent to the change.

8. Where there is a total failure of consideration and defendant has derived no benefit from the contract, or none beyond the amount of money which he has already advanced, such failure of consideration may be shown in bar of the action.

9. The doctrine of substantial performance has no application where the party obligated to perform deliberately and intentionally departs from the terms of the contract and attempts to substitute another type of performance.

10. It does not follow that because a technical rescission has not been made, and cannot be made, that a defendant cannot avail himself of the defense of want or failure of consideration.

Clarence G. Miles, Lincoln, Frank B. Morrison, McCook, for appellant.

Stevens & Scott, McCook, VanPelt, Marti & O'Gara, Lincoln, and Hines & Hines, Benkelman, for appellee.

Heard before SIMMONS, C. J., and CARTER, MESSMORE, YEAGER, CHAPPELL, WENKE, and BOSLAUGH, JJ.

CHAPPELL, Justice.

This action originated as a claim filed by plaintiff in the county court against the estate of Elmer E. Hester, deceased, to recover upon a subscription endowment note. The claim was disallowed. Upon appeal to the district court a jury was waived and the issues were tried to the court. The defense, insofar as important here, was failure of consideration, to which claimant replied that the estate was estopped to make such defense. In its decree the trial court found and adjudged the issues generally in favor of the estate and disallowed the claim.

A motion for new trial was overruled, and plaintiff appealed to this court, assigning substantially: (1) That the trial court erred in its refusal to admit and consider certain evidence; and (2) that the judgment was not sustained by the evidence but contrary thereto and contrary to law. We conclude that the assignments should not be sustained.

Preliminary to discussion of the primary issues, we dispose of the first assignment. On examination by plaintiff of its secretary-treasurer, it was shown that before a new program of religious education was inaugurated by plaintiff in 1946, its board of trustees canvassed its assets and exhibit 13 was identified as a list of its estate and other notes, of which the note here involved was one. The exhibit itself was never offered or received in evidence. In that situation the witness was asked in effect whether or not the note here involved was considered by the board along with all other notes at the time the matter of continuing the college program was being considered. Objection thereto, as self-serving and calling for a conclusion of the witness, was sustained. In that connection, plaintiff then offered to 'show by the witness that among all of the other assets which the college regarded that it owned, this note was considered by the board in connection with deciding whether or not to continue a future educational program.' Thereafter a like objection thereto was made and sustained. The witness was then handed exhibit 13 and asked by plaintiff's counsel whether or not it was 'in the same condition it was when it was considered by the board' and was permitted to answer 'Yes' without objection. Thereafter, with no new question pending, plaintiff offered 'to prove that the list represented by Exhibit No. 13 was considered by the Board of Trustees of Cotner College prior to and at the time of determining whether or not to go forward with a further educational program shortly before September, 1946.' The objection thereto was renewed and sustained. Plaintiff argued that the trial court erred in so ruling. We conclude otherwise.

The question and offers clearly called for a conclusion of the witness, and the offers were either broader than the question or not responsive to any question to which an objection had been sustained. However, in any event the ruling if erroneous was not prejudicial to plaintiff, since the offer was merely cumulative, not only of evidence given by the witness then testifying, but also by another member of the board of trustees, who was permitted without objection to answer at length comparable questions.

Plaintiff also argued that the trial court erred in refusing to consider or admit exhibit 22, a mimeographed letter dated 'June 6, 1947' addressed 'Dear Friend' and signed 'Cotner College P. R. Stevens (stenciled) P. R. Stevens, Pres.' It extended greetings to an unidentified old friend of Cotner College and simply contained information relating to its new program of religious education, which required no reply. As a witness for plaintiff, Stevens testified that he personally mimeographed the letter and mailed a copy to Elmer E. Hester at Benkelman, Nebraska. Offer of the exhibit was objected to for want of sufficient foundation, and that it was incompetent and immaterial. The objection was sustained. Plaintiff thereafter called the executrix as its own witness to have her identify the exhibit a one having been received by deceased during his lifetime. In that connection her testimony was that she had lived in the Elmer E. Hester home after 1947 and would have seen such a letter because she looked after all his correspondence, kept by him in voluminous files. However, she testified that she had never seen such a letter and although having made a thorough search of Elmer E. Hester's papers, she could not find such a letter. The exhibit was then re-offered, to which the previous objection was renewed, with the addition 'It relates to a transaction of a deceased party. Mr. Hester isn't here to admit whether he received that letter.'

Concededly, no demand ever had been made by plaintiff for production of the original, and plaintiff's own evidence affirmatively established that no sufficient foundation had been laid for its admission. In any event, however, its exclusion could not have been prejudicially erroneous in the absence of any evidence, as hereinafter observed, which could make estoppel operative to prevent defendant from relying upon the defense of failure of consideration. Viewed in that light, we are not required to discuss or decide whether or not the letter and such evidence as related thereto was a transaction between deceased and a witness having a direct legal interest in the result of the suit within the purview of section 25-1202, R.R.S.1943.

It is well at this point also to dispose of the issue of estoppel. The doctrine was applied in Ricketts v. Scothorn, 57 Neb. 51, 77 N.W. 365, 367, 42 L.R.A. 794, 73 Am.St.Rep. 491, an action to recover on a promissory note, wherein it is said: 'An estoppel in pais is defined to be 'a right arising from acts, admissions, or conduct which have induced a change of position in accordance with the real or apparent intention of the party against whom they are alleged.' Mr. Pomeroy has formulated the following definition: 'Equitable estoppel is the effect of the voluntary conduct of a party whereby he is absolutely precluded, both at law and in equity, from asserting rights which might, perhaps, have otherwise existed, either of property, or contract, or of remedy, as against another person who in good faith relied upon such conduct, and has been led thereby to change his position for the worse, and who on his part acquires some corresponding right, either of property, of contract, or of remedy.' 2 Pom.Eq.Jur. 804.' In the light of such rules the doctrine of estoppel was applied to permit recovery.

As stated in 31 C.J.S., Estoppel, § 59, p. 236: 'Equitable estoppel or estoppel by misrepresentation is the effect of the voluntary conduct of a person whereby he is precluded, both at law and in equity, from asserting rights against another person relying on such conduct; and it arises where a person by his acts, representations, or admissions, or even by his silence when it is his duty to speak, intentionally or through culpable negligence induces another to believe that certain facts exist, and the other person rightfully relies and acts on such belief, and will be...