Dickherber v. Turnbull

• Decision Date: 15 September 1930
• Docket Number: No. 21004.,21004.
• Citation: 31 S.W.2d 234
• Parties: DICKHERBER v. TURNBULL et al.
• Court: Missouri Court of Appeals

31 S.W.2d 234

DICKHERBER v. TURNBULL et al.

No. 21004.

St. Louis Court of Appeals. Missouri.

September 15, 1930.

Rehearing Denied October 16, 1930.

Appeal from Circuit Court, Lincoln County; Edgar B. Woolfolk, Judge.

"Not to be officially published."

Action by Henry A. Dickherber against David Turnbull and others. From a judgment for defendants, plaintiff appeals.

Affirmed in part, and reversed and remanded in part, with directions.

W. R. Dalton, of Wentzville, B. J. Creech, of Troy, and B. H. Dyer, of St. Charles, for appellant.

Killam & Avery and Howell & Jackson, all of Troy, for respondents.

BENNICK, C.

On June 9, 1924, defendants, Sallie McMahan, Lee O. McMahan, and David Turnbull, executed a promissory note for the sum of $4,000, in favor of plaintiff, Henry A. Dickherber, payable one year after date, and bearing interest at the rate of 7 per cent. per annum. The first payment of interest was made on September 25, 1925, and the second payment one year later. This action on the note was brought in the circuit court of Lincoln county on September 29, 1928; and from the judgment for the defendants, plaintiff has duly appealed.

The petition was in the conventional form for an action of this character.

Defendant Turnbull's answer was a general denial, coupled with pleas of failure of consideration, and his discharge as surety by reason of an extension of time granted by plaintiff to defendants McMahan, alleged to have been the principal debtors.

Defendant Lee O. McMahan's answer was an admission of the execution by him of the note sued upon, coupled with a plea that on October 8, 1928, he was duly adjudged a bankrupt in the United States District Court for the Eastern Division of the Eastern District of Missouri; that the note in question was fully set out and described as one of his liabilities in his petition for bankruptcy; and that by reason of his having been adjudged a bankrupt, the obligation of said note had been fully discharged, and he was not liable upon the same.

Defendant Sallie McMahan's answer was an admission of the execution of the note, to which was joined an affirmative plea that she was the wife of defendant Lee O. McMahan, and that by reason of his having been adjudged a bankrupt, as pleaded in his answer, she was discharged from all liability by reason of having signed the note.

Separate replies, each in the form of a general denial, were filed by plaintiff to the answers of defendants Turnbull and Lee O. McMahan. If a reply was filed to the answer of defendant Sallie McMahan, the record does not contain it, but nevertheless it appears that the case was tried as though the new matter contained in her answer was duly at issue.

Much of the evidence was uncontradicted, and with the disputed points of fact resolved in defendants' favor by the verdict of the jury, the case appears as follows:

One Cannon was the owner of a farm in Lincoln county, which, on March 15, 1920, he conveyed by general warranty deed to defendants Lee O. McMahan and Sallie McMahan for a consideration of $30,000, subject to two deeds of trust, the first for $12,500, in favor of the Bank of Warren County and the Wright City Bank, and the second for $3,500, to plaintiff, Dickherber. On March 15, 1921, when the interest fell due on the note held by plaintiff, McMahan was unable to pay the same, whereupon plaintiff had him execute a new note for $3,730, representing the principal and accrued interest, and secured by a second deed of trust on the land. Thus the matter stood, McMahan paying the interest on all the notes outstanding until about a year before the transaction leading up to this litigation, when the two banks began to press him for the payment of the indebtedness due to them. McMahan thereupon set about trying to procure sufficient funds to take up the notes and deeds of trust held by the banks, but up to the time of the transaction in question he had been unable to do so.

Plaintiff unquestionably knew of these facts, and indeed the testimony shows that officials of the banks had been to see him in an endeavor to get him to assume the first deed of trust held by them; that correspondence had been going on prior to the execution of the note in suit; and that plaintiff had made trips to Warrenton and Wright City with a view to inducing the banks to withhold a foreclosure under their deed of trust.

Finally, becoming impatient at the delay, the banks caused the land to be advertised for sale at Troy, the sale to take place on June 9, 1924. Prior to this date, plaintiff had made no arrangements with the McMahans for the payment of the note secured by the first deed of trust, but on his own initiative he had arranged with one John Rall to borrow $5,000, telling Rall that the farm was going to be sold, and that he needed the money available so that he would be in a position to save himself. He also wrote to defendant Turnbull, requesting him to be at Troy on the day of the sale.

On that day, plaintiff came to Troy, and about noon saw the representative of the two banks, proposing to them that he would pay $4,000 on the debt of the McMahans to them if they would call off the sale. This proposition was accepted, subject to plaintiff's further agreement to pay the costs of the advertising, and the expenses incurred by the trustee in going to Troy.

Shortly after noon, plaintiff met defendants Turnbull and McMahan, and told Turnbull that if McMahan would give him his note for $4,000, and if he (Turnbull) would go on it, he could stop the sale. Turnbull remonstrated, suggesting that the undertaking was too great for a man of his age to go into with nothing back of it, whereupon plaintiff assured him that if he would sign the note, he would take it up as soon as the deal was completed. With this understanding, Turnbull signed the note, which is the one upon which suit is brought, and immediately upon its execution, checks for the total sum of $4,000 were drawn by plaintiff, payable to McMahan, and thereupon indorsed and turned over by the latter to the banks for the respective shares due them, with the result that the sale was stopped.

It was conceded that no consideration passed between Turnbull and plaintiff for the signing of the note, and the evidence for defendants was that McMahan did not ask Turnbull to sign the note for him, or as his security, but, as we have heretofore indicated, that his signing was solely at plaintiff's request.

More than a year later, the McMahans secured a loan from the Walton Trust Company to take up the balance due to the banks, the loan being finally closed on September 25, 1925, at which time, in the course of the negotiations between plaintiff and McMahan, the first interest payment was made upon the note in suit. At the same time the indebtedness of the McMahans to plaintiff on the original note for $3,730 was reduced to $2,278, and plaintiff thereupon took from McMahan a new note and deed of trust for the latter amount, said deed of trust being a third, and subject to first and second deeds of trust held by the Walton Trust Company.

When the interest due on the $4,000 note was paid by McMahan on September 25, 1925, plaintiff agreed to let the note run for another year, and on September 25, 1926, a second interest payment was made.

In 1927, prior to the time the interest fell due on the notes held by the Walton Trust Company, McMahan went to plaintiff and told him that he would be unable to meet the payments thereon, and suggested that the best course to take would be to allow himself to become in default. Plaintiff opposed the idea, however, and suggested that McMahan sell his stock and realize what cash he could, after which he himself would pay the balance due the Walton Trust Company, taking McMahan's note in return. This course was followed, and repeated in 1928, when the interest again fell due.

Turnbull all the while was proceeding upon the theory that the $4,000 note had been taken up, and he did not learn that it was still in existence until in the summer of 1928, when he was informed by McMahan of what had transpired.

At the close of all the evidence, the court directed a verdict in favor of defendants Lee O. McMahan and Sallie McMahan, evidently upon the theory that the adjudication of the former as a bankrupt, in a proceeding in which the note was listed as a liability, had operated to discharge both of such defendants from liability thereon in this action. The jury found for defendant Turnbull upon the issues joined; and after the overruling of his motion for a new trial, plaintiff has duly appealed.

The issues on this appeal arise upon plaintiff's claim of error in regard to the giving and refusing of instructions, and the admission of evidence on behalf of defendants.

The first of these contentions seriously pressed is that it was error for the court to have permitted the introduction of parol evidence, which was designed to show that defendant Turnbull had signed the note for the accommodation of plaintiff. Counsel argue that Turnbull had signed as a maker, and that the evidence in question directly impeached the obligatory terms of the note itself, and was...