Glass v. Drieborg

• Decision Date: 06 January 1941
• Docket Number: No. 108.,108.
• Citation: 295 N.W. 547,296 Mich. 30
• Parties: GLASS v. DRIEBORG et al.
• Court: Michigan Supreme Court

296 Mich. 30

295 N.W. 547

GLASS

v.DRIEBORG et al.

No. 108.

Supreme Court of Michigan.

Jan. 6, 1941.

Action by Harry Glass, Sr., receiver of the American Home Security Bank, against J. D. Drieborg and John Mieras on a note. From a judgment for plaintiff, defendant J. D. Drieborg appeals.

Reversed and remanded for entry of judgment for defendant J. D. Drieborg.Appeal from Circuit Court, Kent County; William B. Brown, judge.

Argued before the Entire Bench.

Carmody, Geib & Walsh, of Grand Repids, for appellant.

John M. Dunham, of Grand Rapids, for appellee.

BOYLES, Justice.

This is a suit by the receiver for the American Home Security Bank, of Grand Rapids, against John Mieras, maker of, and J. D. Drieborg, endorser on, a promissory note. Mieras confessed judgment. Drieborg had trial before the court without a jury. Plaintiff had judgment and Drieborg appeals.

The note was due October 13, 1933. Suit was begun October 28, 1939. Drieborg's sole defense was the statute of limitations. Plaintiff replied that Drieborg had ‘prepared and filed a sworn, financial statement in which said obligation is admitted.’ Defendant admitted signing the alleged financial statement, denied that it waived his defense under the statute, and claimed that it was given under such circumstances as to repel the presumption of any promise or intention to pay. These circumstances were as follows: Mieras made payments, but Drieborg never made any payments on the note. Sometime before the six-year period would elapse, the bank mailed Drieborg a blank upon which to make a financial statement, requesting that it be made out and returned to the bank. This blank was received by Drieborg and put into the wastebasket. About a month before the note would otherwise be outlawed, Mieras, the maker, through his attorney, Mr. Walsh, endeavored to effect a compromise with the receiver or obtain a reduction in the amount due. The receiver informed Walsh that no negotiations would be entered into until a sworn financial statement by both the maker and endorser was furnished to the bank. Walsh obtained from the bank a blank financial statement, had Drieborg come to his office, and there Mr. Drieborg signed and swore to the financial statement. Walsh turned the statement over to the bank and it was received in evidence. Plaintiff relies on it to toll the statute. This statement, after reciting Drieborg's assets and liabilities, contains the following:

‘Contingent Liability

‘Notes endorsed: John Mieras Note held by Am. Home Security Receiver $981.40 * * *

‘Total Contingent $981.40 * * *

‘These statements of my assets, liabilities, income and expense, are filed in connection with my indebtedness at the American Home Security Bank, and accurately represent my present worth and ability to apply on my indebtedness at the bank.

‘Dated Sept. 29, 1939

‘Signed Jake D. Drieborg’

Drieborg admitted signing the statement in Mr. Walsh's office and testified that his object in making it was the possibility of Mieras making a settlement with the bank and that, on request of the bank, he (Mieras) wanted this financial statement. He further testified that he told Mr. Walsh at the time of making it that he couldn't and wouldn't pay the note. Mr. Walsh testified that he was acting as the attorney for Mr. Mieras and that when Drieborg gave him the financial statement ‘we discussed the whole situation at considerable length and Mr. Drieborg told me that he couldn't and wouldn't pay it.’ Mr. Drieborg never discussed the matter with the receiver or anyone connected with the bank. Plaintiff's objection to all this testimony was overruled by the trial court. Counsel now claims this testimony was inadmissible. It was competent for the purpose of showing that the financial statement was furnished under circumstances negativing a promise to pay. This question is not raised in the statement of questions involved and this ruling was not appealed. It cannot now be considered by us. The sole question before this court as stated by counsel for both parties is: ‘Was the furnishing of the financial statement under the undisputed circumstances such an unqualified acknowledgment of the debt as to toll the running of the statute of limitations?’

Unless this signed statement tolls the statute, plaintiff's cause of action is barred. 3 Comp.Laws 1929, § 13976, Stat.Ann. § 27.605. In actions founded upon contract, no acknowledgment or promise to pay will prevent and action being barred by the statute of limitations unless the acknowledgment or promise is made by or contained in some writing signed by the party to be charged. 3 Comp.Laws 1929, § 13984, Stat.Ann. § 27.613. Drieborg's right to claim the benefit of the statute is not affected by any payment or promise made by Mieras. 1 Williston on Contracts, Rev.Ed., § 193; Borden v. Fletcher's Estate, 131 Mich. 220, 91 N.W. 145. See, also, Godde v. Marvin, 142 Mich. 518, 105 N.W. 1112.

‘If the debtor admits his indebtedness but couples the admission with a refusal to pay, no new promise can be implied.’ 1 Williston on Contracts, Rev.Ed., § 168.

‘As the force of an acknowledgment depends in most States upon the inference to be drawn from it of an intention to pay, if there is anything in the surrounding circumstances, even though not in the words of the acknowledgment, tending to negative such an inference or to leave it in doubt, the indebtedness will not be revived.’ 1 Williston on Contracts, Rev.Ed., § 170.

‘* * * it has ever since been recognized in England, and generally in the United States, that the effect of an admission or acknowledgment is merely that of evidence of a promise implied in fact. And if, taking all the circumstances into account, the admission does not indicate an intention to pay, no liability arises from it.’ 1 Williston on Contracts, Rev.Ed., § 161.

The law of this case was settled in this State in 1848. In the case of Ten Eyck v. Wing, 1 Mich. 40, this court said:

‘The next point is, that by the stipulation there was a sufficient acknowledgment of the debt to take it out of the statute. * * *

‘We are perhaps not prepared to say with Baron Parke, 14 Mees. § Wels. 744, that a certain train of decisions allowing very slight acknowledgments to take a case out of the statute, was a disgrace to the law; but we can say with him, we trust there is no danger of our falling into the same error. The consequence of this rule of construction is, that whenever a new promise is set up to remove the bar of the statute, it ought to be proved in a clear and explicit manner, either expressly, or by such an unqualified acknowledgment as authorizes its implication. [Bell v. Morrison], 1 Pet. [351] 362 ;Cambridge v. Hobart, 10 Pick. [Mass.] 232; [Gardner v. Tudor] 8 Pick. [Mass.] 206; [Bangs v. Hall], 2 Pick. [Mass.] 368 . And although it is held no set form of words is requisite to constitute a sufficient acknowledgment, and that it may be inferred from facts without words, Whitney v. Bigelow, 4 Pick. [Mass.] 110, yet the acknowledgment ought...