Fossan v. Gibbs

• Decision Date: 07 March 1914
• Docket Number: 18,706
• Citation: 139 P. 174,91 Kan. 866
• Parties: EMELY VAN FOSSAN, as Administratrix, etc., Appellee, v. S. T. GIBBS et al., Appellants
• Court: Kansas Supreme Court

139 P. 174

91 Kan. 866

EMELY VAN FOSSAN, as Administratrix, etc., Appellee, v. S. T. GIBBS et al., Appellants

No. 18,706

Supreme Court of Kansas

March 7, 1914

Decided January, 1914.

Appeal from Cowley district court; CARROLL L. SWARTZ, judge.

Judgment affirmed.

SYLLABUS

SYLLABUS BY THE COURT.

UNCONDITIONAL PROMISE TO PAY--Not Affected by Prior Oral Agreement. An unconditional promise in writing to pay a certain sum of money at a fixed time can not be defeated by parol evidence of a prior or cotemporaneous oral agreement that the obligation, which was not otherwise assailed, was to be paid out of profits of a business to be launched by the use of money for which it was given.

C. T. Atkinson, and E. H. Koehl, both of Arkansas City, for the appellants.

John Parman, of Arkansas City, for the appellee.

OPINION

BENSON, J.

This is an action upon an instrument whereby the makers promised to pay Austin Van Fossan and A. J. Miller $ 300, six months after date. It was signed by the defendants and several others, described as members and shareholders of the Arkansas City, Kan., branch of the Socialist Commercial Industrial Cooperative Association of America. Following the usual form of a promissory note is a statement that it is given to purchase property, described, consisting of the furnishings and tools of a retail meat market, the title to which is to remain in the payee until the note is paid.

It appears that Van Fossan deposited $ 300 in a bank to be used in buying the necessary tools, etc., with which to carry on the business. This note was then drawn payable to him and A. J. Miller, signed by twelve of the sixty members, and delivered to Van Fossan. Thereupon Miller, who was at first chairman of the association and afterwards bookkeeper, checked out the money, paid for the property, and then indorsed the note to Van Fossan. Miller really had no interest in it. The business failed, the property was sold, and the proceeds applied on the note.

The defendants sought to prove that it was agreed that the note should be paid out of the profits of the business of the association. Evidence of such an agreement, however, was held immaterial, and that defense was withdrawn in the instructions.

The instrument was an unconditional promise to pay money at a certain time, lacking, however, the quality of negotiability because of the omission of the words "or order" or "or bearer." (Neg. Inst. Law, § 8, Gen. Stat. 1909, § 5254.) Oral evidence that it was not to be paid until profits sufficient for that purpose were made out of the business would contradict its terms...