Fisher v. Briscoe

• Decision Date: 06 October 1890
• Citation: 25 P. 30,10 Mont. 124
• Parties: FISHER v. BRISCOE.
• Court: Montana Supreme Court

25 P. 30

10 Mont. 124

FISHER v. BRISCOE.

Supreme Court of Montana

October 6, 1890

Appeal from district court, Lewis and Clarke county; WILLIAM H HUNT, Judge.

This is an appeal from an order granting a motion for judgment on the pleadings, and from the consequent judgment.The complaint is on two promissory notes, each for $5,000, and dated November 1, 1887, made by defendant, payable to plaintiff.The amended answer of defendant admits the making and delivery of the notes, and further alleges that each of said notes bears the following indorsement: "Collateral in Second National Bank to secure this note, to be first exhausted."This answer then sets up the following matter as a separate defense: "That, prior to the execution of the notes defendant bought from plaintiff 85,000 shares of stock in a mining company for $20,000, of which he had paid $10,000 at the time of making the notes; that as part consideration for the notes, plaintiff agreed to cause these shares to be transferred to defendant on the books of the company, and the certificates issued to defendant, and it was agreed in writing that the shares should be deposited as collateral for the notes, with conditions for the delivery of the shares to defendant, on payment of the notes, and if the notes were not paid, the stock was to be delivered to plaintiff, and by him sold as a pledge, and the proceeds applied to the payment of the notes."The answer further sets forth: "That plaintiff did not cause the shares to be transferred and issued to defendant, but the certificates were deposited as collateral, as agreed, except that they were not transferred and issued to defendant, or assigned to him, and the same remained subject to the order of the plaintiff; that plaintiff did not exhaust said security, and refuses to recognize any right of defendant in said stock; that it was agreed by plaintiff and defendant, at the time of making the notes, that said stock should be assigned to defendant, and delivered by defendant to plaintiff as collateral, and that the collateral should be exhausted before suit was commenced on the notes; that the stock is of value, and, if sold, and the proceeds applied, would pay all or part of the notes.Defendant prays that the action be abated until plaintiff has exhausted the security as contemplated."The written agreement referred to in the answer is as follows: "The inclosed 85,000 shares of stock in the Frohner Gold & Silver Mining Company are deposited as collateral security for the payment of two promissory notes of five thousand dollars each, executed by John O. Briscoe to Henry Fisher, one payable in six months, and the other payable in nine months from date; upon the payment of the first note 45,000 shares to be delivered to the said Briscoe, and balance to be delivered to him on payment of the other said note, and if said first note is not paid at maturity the said 45,000 shares to be delivered to said Fisher to be held and disposed of as collateral security for said note and if said second note is not paid at maturity, then the residue of said stock to be likewise delivered to said Fisher for a like purpose.Nov. 1, 1887.J. O. BRISCOE.HENRY FISHER."A motion was made by plaintiff to strike out from the answer the matter set up as a separate defense.This motion was denied, and a replication filed, of which it is sufficient to say that it contained denials which formed an issue.With these pleadings, the case went to trial.The defendant was upon the stand as a witness and his counsel asked him this question "Go on and in your own way give a history in brief as to the consideration of these two notes.If they were notes given in renewal of notes, state the consideration of the notes they were given in renewal of."The plaintiff objected to this question, upon the ground that it is not contended in the answer that the notes were given in renewal of notes, and for the further reason that the latter part of the question says: "If they were notes given in renewal state the consideration of the notes they were given in renewal of."The objection was sustained.Thereupon the defendant obtained leave, and amended his answer.This amended answer, which was the second amended answer in the case, states the facts alleged in the former amended answer, except that it alleges that the indorsements on the notes in suit were, "Secured by collateral of 40,000 shares of the capital stock of the Frohner Gold & Silver Mining Company," and a like indorsement upon the other note as to 45,000 shares of said stock.It pleads the same written instrument above set forth in full, and then alleges the following additional matter: "That the purchase of the stock was in June, 1887, on which defendant paid $5,000, and the stock was deposited in the bank, to be delivered to defendant upon his paying the balance of $15,000 within thirty days, and, upon his failure, he was to forfeit the $5,000 and the stock.That on July 29th the parties made another contract, by which it was agreed that defendant should pay plaintiff $1,000 in cash, and deliver four notes, one for $5,000 due September 1st, one for $5,000 due November 1st, one for $3,000 due August 6th, and one for $1,000 due August 15th, and defendant should still have the stock.The sum of these notes and the cash, make up the former sum of $15,000.That the $1,000 cash was paid.That it was then agreed that the stock should be deposited and held as collateral for the notes, and upon each of these notes was indorsed: 'Collateral in Second National Bank to be first exhausted;' and it was agreed that no action at law should be commenced until such collateral was exhausted.That the notes were paid, except the two $5,000 ones.Then comes the transaction of November 1st. Defendan...