Elliott v. Qualls

• Citation: 149 Mo. App. 482,130 S.W. 474
• Parties: ELLIOTT v. QUALLS.
• Decision Date: 07 July 1910
• Court: Court of Appeal of Missouri (US)

130 S.W. 474

149 Mo. App. 482

ELLIOTT v. QUALLS.

Springfield Court of Appeals. Missouri.

July 7, 1910.

Rehearing Denied July 19, 1910.

1. NOVATION (§ 12)—EVIDENCE—BURDEN OF PROOF.

A surety on a note, who defends a suit on the ground of a contract whereby a third person was substituted as the debtor, has the burden of proving a valid contract for a valuable consideration, whereby the third person was substituted as the debtor.

2. NOVATION (§ 12) — EVIDENCE — SUFFICIENCY.

In an action on a note, evidence of a surety held not to support his defense that a third party had been substituted as the principal debtor by a valid contract on a valuable consideration.

3. NOVATION (§ 7)—WHAT CONSTITUTES.

The essence of novation is that all the three parties assent to or concur in the agreement whereby the new debtor is substituted for the old and the old debt extinguished.

4. PRINCIPAL AND SURETY (§ 161) — DISCHARGE OF SURETY—EXTENSION OF TIME OF PAYMENT—EVIDENCE.

To release a surety on a note on the ground of the extension of the time of payment, there must be a valid contract of extension, and, though payment of interest in advance for a definite period is a sufficient consideration therefor, a mere notation on the note that interest was paid on a certain date to a certain future date by the payee indorsing the note to a third person is insufficient to prove a contract extending the time of payment.

5. BILLS AND NOTES (§ 443)—ACTIONS—TITLE OF PAYEE — INDORSEMENT — RIGHT TO ERASE.

Where the payee of a note, after indorsing it to a third person, together with a statement of payment of interest on a certain date to a certain future date, obtained the possession of the note and brought suit thereon, the court properly allowed him, before offering the note in evidence, to erase his indorsement.

6. PRINCIPAL AND SURETY (§ 125) — DISCHARGE OF SURETY—EXTENSION OF TIME OF PAYMENT OF DEBT.

To discharge a surety by reason of an extension of time of payment, the creditor must do some act by which he deprives himself of the right to proceed at law for the collection of the debt, and a mere forbearance to prosecute the debtor does not discharge the surety.

Appeal from Circuit Court, Barry County; F. C. Johnston, Judge.

Action by H. H. Elliott against G. W. Qualls. From a judgment for plaintiff, defendant appeals. Affirmed.

Fielding P. Sizer, for appellant. H. H. Bloss, for respondent.

NIXON, P. J.

This action was commenced in a justice's court by H. H. Elliott filing therein on August 31, 1909, a promissory note for $125, bearing compound interest at 8 per cent. per annum, dated August 8, 1901, payable to the order of H. H. Elliott 21 months after date, signed by M. W. Edwards and G. W. Qualls, the appellant. The suit was begun against both Qualls and Edwards, but was dismissed as to Edwards in the justice's court because the constable had returned the summons not served on Edwards. Defendant prevailed in the justice's court, but upon trial de novo in the circuit court a peremptory instruction was given to find for the plaintiff the amount of the note sued on with interest as provided in the note, after deducting credits. The verdict was for $102, and judgment was entered thereon. Defendant has appealed.

1. Appellant insists that the court erred in giving the peremptory instruction. The evidence for the defense, upon the most favorable construction, is substantially as follows: That M. W. Edwards purchased the engine of the plaintiff and gave the note in question with defendant G. W. Qualls (his father-in-law) as surety; that, after using the engine some two months, he went to another place, leaving the engine standing in Aurora, Mo., but he secured one Parvin to dispose of the same; that Parvin went with Edwards' father to Elliott's place of business in Aurora to see about the disposal of the engine; that Edwards' father went in and conversed with Elliott and then came out and went with Parvin to close a deal with one Keeler and others who operated a mine, and the result was that the engine was installed at the mine. Some time after this, M. W. Edwards returned to Aurora and saw Elliott, and they had a conversation which is related in M. W. Edwards' testimony as follows: "I said to him, `I understand they have sold my engine.' He said, `Yes, some other parties bought it.' `Well,' I said, `then they will pay you for it,' and he said `Yes, sir.' Q. What did he say about it? A. That is all he said—that he would take those other parties. Q. What did he say he would do with you? A. He said he would release me. Q. Did you ever have anything more to do with the engine? A. No, sir." Cross-examination: "Q. You told him there you understood that the machinery had been sold? A. Yes, sir. Q. And he told you that you had been released from this note—that he had taken the other parties? A. He said he would take these other parties and release me. Q. Did you ask him for your note then? A. No, sir. Q. Have you ever asked him for this note? A. No, sir. Q. It did not occur to you after he told you you were released from the note that he should deliver the note to you? A. My father was there, and I supposed he would see after it and get the note. Q. You were at his store when this talk was had? A. Yes, sir. Q. He keeps his notes and business there in the store? A. Yes, sir. Q. Yet you knew he said he would release you? A. Yes, sir. Q. You have never asked him for the note from that day to this? A. No, sir. Q. You never told him you were released—he has written you a number of letters about this? A. I have never received a scratch from him. Q. Whom did he say he had taken? A. Well, those fellows that bought the engine, Mr. Casey and Zumbrun."

J. S. Zumbrun, a witness for the defendant, stated that, after the mine had burned down, he was in Elliott's place of business to get some powder, but that Elliott would not let him have it. "I said, `I don't owe you anything.' He said, `No, I don't know as you do; but the company up there owes me for that engine.'"

J. S. Mitchell, defendant's witness, testified that after the mine burned he purchased the engine for use in a greenhouse. "Q. Who from? A. Mr. Elliott. Q. Who claimed the engine then? A. Mr....