Haggerty v. MacGregor, Docket No. 2465
| Decision Date | 21 March 1968 |
| Docket Number | Docket No. 2465,No. 1,1 |
| Citation | 9 Mich.App. 671,158 N.W.2d 33 |
| Parties | James J. HAGGERTY, Plaintiff-Appellant, v. Norman R. MacGREGOR, Defendant-Appellee. Defendant-Appellee |
| Court | Court of Appeal of Michigan — District of US |
Balfour D. Peisner, Detroit, for appellant.
John C. Frakes, Jr., Matheny, Schureman & Frakes, Detroit, for appellee.
Before GILLIS, P.J., and McGREGOR and THORBURN, * JJ.
Plaintiff James J. Haggerty sued defendant Norman R. MacGregor on a promissory note executed in October, 1950. After a nonjury trial, the circuit judge made written findings and on July 1, 1966, entered a judgment of no cause of action. This appeal is taken from that judgment.
In 1950, defendant and Leo Bonnie proposed to open and operate an automobile dealership in Lake City, Michigan. Bonnie approached plaintiff for the purpose of securing needed capital. In return for a loan of $8,000 Bonnie and the defendant jointly executed a two-year note in favor of plaintiff which formed the basis of this suit. The business venture encountered financial difficulties and in 1952 Bonnie purchased defendant's interest and recorded a bulk sale affidavit. Bonnie agreed to assume all the business debts.
Shortly thereafter, defendant moved to California and after a series of business reverses in that state he was adjudicated a bankrupt and received a discharge in October 1954. The 1950 note to Haggerty was not listed in the schedule of indebtedness filed in conjunction with the bankruptcy proceedings.
Defendant returned to Michigan, and for substantial periods between 1954 and 1962 was outside the United States on business for his employer, Ford Motor Company. The evidence discloses that during this period Haggerty knew of MacGregor's whereabouts and occasionally encountered MacGregor but at no time was reference made to the note.
Bonnie signed a note for $9,440 dated April 22, 1954 (Thursday), payable to plaintiff which represented the original 1950 note plus the interest accrued to the date of the 1954 note. Bonnie made no payments on the original loan until the same week that the 1954 note was executed. Plaintiff did not surrender the original note. After periodic payments had been made by Bonnie, plaintiff stamped the 1954 note 'paid in full' and wrote across the face of the note 'Settled in full as far as Bonnie is concerned for $4000.' On July 31, 1959, plaintiff executed a formal release witnessed by two persons releasing Bonnie, his heirs, etc. from all claims whatsoever that might have accrued up to the date of execution. The present action was commenced in 1962.
The trial judge found on a question of fact that the 1954 note 'completely replaced the 1950 note; and that the plaintiff accepted Bonnie and the new note in the place and stead of the original instrument and makers.'
Plaintiff contends on appeal that the 1954 note is void and of no effect because, while dated on a Thursday, it was actually executed on a Sunday. This issue, however, was not presented for determination by the trial court and this Court has repeatedly refused to consider issues not raised at trial. Baker Contractor, Inc. v. Chris Nelsen & Son, Inc. (1965), 1 Mich.App. 450, 136 N.W.2d 771; Poss v. Rossen-Poss Agency, Inc. (1966), 3 Mich.App. 726, 143 N.W.2d 616; House v. Gibbs (1966), 4 Mich.App. 519, 145 N.W.2d 248.
The issue we do decide is whether the evidence supports the trial court's finding that plaintiff intended to accept Bonnie's note in substitution for the joint note of Bonnie and defendant.
Generally, acceptance of a renewal note is not regarded as payment of a preexisting note or obligation. In re Dunneback's Estate (1942), 302 Mich. 73, 4 N.W.2d 472. However, the renewal note will be held to constitute payment where such was the intention of the parties. As stated in Chase v. Gregory (1935), 274 Mich. 32, at p. 37, 263 N.W. 789, at p. 791:
"A bill or note should be regarded as payment, whenever it appears such was the intention of the parties, and 'that such was the understanding of the parties may be proved by circumstances, such as the acts and conduct of the parties, as well as by direct proof of an express promise or agreement.' 2 Parsons on Contracts, 624; Hotchin v. Secor, 8 Mich. 494; Sage v. Walker, 12 Mich. 425; Brown v. Dunckel, 46 Mich. 29, 8 N.W. 537.' Riverside Iron Works v. Hall, 64 Mich. 165, 168, 31 N.W. 152.'
See also, 6 Corbin on Contracts, § 1293,...
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...Minn. 315, 178 N.W.2d 254 (1970); Holland v. First National Bank in Dallas, 597 S.W.2d 406 (Tex.Ct.Civ.App.1980); Haggerty v. MacGregor, 9 Mich.App. 671, 158 N.W.2d 33 (1968). We have been directed to no case, however, in which the amount of indebtedness as contrasted with the underlying se......
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