Gramkow v. Farmers' Cooperative Irrigation Co.

• Decision Date: 02 May 1929
• Docket Number: 5136
• Citation: 47 Idaho 578,277 P. 431
• Parties: GUST GRAMKOW, Respondent, v. FARMERS COOPERATIVE IRRIGATION COMPANY, LIMITED, Appellant
• Court: Idaho Supreme Court

277 P. 431

47 Idaho 578

GUST GRAMKOW, Respondent, v. FARMERS COOPERATIVE IRRIGATION COMPANY, LIMITED, Appellant

No. 5136

Supreme Court of Idaho

May 2, 1929

CUSTOMS AND USAGES-PAROL EVIDENCE RULE.

1. Parol evidence of custom and usage held inadmissible to establish that order drawn by defendant company on its treasurer was issued and accepted as check drawn on bank of which treasurer was president and in which sufficient moneys were kept on general deposit to pay such orders, and that the order was not presented for payment within reasonable time.

2. Legal effect of instrument cannot be varied or contradicted by parol any more than its express terms.

3. Where terms of contract are plain and unambiguous, they cannot be varied or contradicted by evidence of usage and custom.

4. It is not error to strike a pleading in support of which evidence would not be admissible on the trial.

5. In action to recover sum of money evidenced by order drawn on treasurer of defendant company, it was no defense that there was a custom of giving and receiving such orders as checks on bank of which treasurer was president, and that order was not presented to bank for payment within reasonable time, bank having failed, and plea alleging such facts was properly stricken on account of parol evidence rule.

APPEAL from the District Court of the Seventh Judicial District, for Payette County. Hon. B. S. Varian, Judge.

Action on a warrant. Judgment for plaintiff. Affirmed.

Judgment affirmed. Costs to respondent.

E. B Smith and Wm. M. Morgan, for Appellant.

"It is well settled that if a written instrument is delivered the purpose for which it was delivered, as between the parties and as to those having notice, may be shown by parol and the effect of the admission of such testimony is not violative of the rule against the admission of parol evidence to vary the terms of a written instrument, but is to show the intention of the parties and what the agreement was." (First Nat. Bank of Idaho v. Reins, 42 Idaho 720, 248 P. 9; Clark v. Ducheneau, 26 Utah 97, 72 P. 331; Peugh v. Davis, 96 U.S. 332, 24 L.Ed. 775; McCaull-Dinsmore Co. v. Stevens, 59 Mont. 206, 194 P. 213.)

George Donart and Norris & Sutton, for Respondent.

Parol or extrinsic evidence is inadmissible to contradict, alter, add to or vary either the express terms of a written instrument which is plain and unambiguous upon its face, or to contradict, explain or control the legal effect of such instrument. (22 C. J. 1070, 1075, 1169, 1177, 1184; Hurt v. Monumental Mercury Mining Co., 35 Idaho 295, 206 P. 184; International Harvester Co. v. Beverland, 37 Idaho 782, 219 P. 201; Central Bank of Bingham v. Perkins, 43 Idaho 310, 251 P. 627; Utah Construction Co. v. McIlwee, 45 Idaho 707, 266 P. 1094.)

The terms and provisions of an express contract, if clear and unambiguous cannot be varied by proof of custom. (17 C. J. 508; 27 R. C. L., Usage and Customs, sec. 20, p. 172; Vick v. Howard, 136 Va. 101, 31 A. L. R. 240, 116 S.E. 465; A. R. G. Bus Co. v. White Auto Co., 52 Cal.App. 142, 198 P. 829; Rottman v. Hevener, 54 Cal.App. 485, 202 P. 334.)

WM. E. LEE, J. Budge, C. J., Givens, J., and Adair and Baker, D. JJ., concur.

OPINION

WM. E. LEE, J.

In answer to a complaint for the recovery of a sum of money, evidenced by an instrument in writing in the nature of a warrant or order, directing its treasurer to pay plaintiff said sum, defendant admitted the indebtedness and that it had made, executed and delivered the warrant or order in payment thereof. As a separate defense, among other things, it was alleged that for a number of years defendant had followed the practice of paying its indebtedness by issuing orders on its treasurer, who was also president of a local bank, in which were kept on general deposit sufficient moneys to its credit to pay such orders, and particularly the order held by plaintiff; that, by an understanding with the bank, such orders were cashed as checks; that plaintiff was well aware of the custom of giving such orders in payment of its debts and the custom of the bank in cashing such orders; that the order was issued and delivered by defendant, and understood by plaintiff, as a check on defendant's checking account, payable upon presentation; that the order was delivered to plaintiff in New Plymouth, January 1, 1927, and was not presented for payment until after January 7, 1927, when the bank failed. It was also alleged that by reason of plaintiff's negligence in failing to present the order for payment within a reasonable time after its receipt, and while the bank was still open, defendant had been damaged in the amount of the order and, therefore, discharged from any obligation to plaintiff in the amount of the order.

The court ordered the separate defense stricken and sustained a general demurrer to the answer. On the failure of the defendant to further plead, judgment was made and entered for plaintiff, from which this appeal is prosecuted.

The important question in the case is whether the court erred in striking the separate defense. There is no issue here as to the purpose of the delivery of the writing. It is alleged in the complaint, admitted in the answer and realleged in the separate answer, that the purpose of the delivery of the order was the payment of the debt. What defendant desired to prove by parol was that, because of the existence of a practice or custom, with which the parties were familiar, its order in writing, directing its treasurer to pay respondent a sum certain, was not an order on its treasurer, but was, in legal effect, its check drawn on the Farmers State Bank of New Plymouth, directing it to pay respondent the identical sum. In other words, it...