Hargadine-mckittrick Dry Goods Co. v. Goodman

• Decision Date: 25 February 1908
• Parties: HARGADINE-McKITTRICK DRY GOODS CO. v. GOODMAN.
• Court: Florida Supreme Court

45 So. 995

55 Fla. 361

HARGADINE-McKITTRICK DRY GOODS CO. v. GOODMAN.

Florida Supreme Court, Division B.

February 25, 1908

Error to Circuit Court, Escambia County; J. Emmet Wolfe, Judge.

Action by the Hargadine-McKittrick Dry Goods Company against C. C Goodman. Judgment for defendant, and plaintiff brings error. Reversed and remanded.

Syllabus by the Court

SYLLABUS

Novation takes place by agreement of all the parties concerned, and therefore depends entirely upon the intention of the parties. It is matter of proof, and not matter of law. Where A undertakes to pay B.'s debt, the obligation assumed may be collateral to B.'s obligation, rather than substituted therefor. If intended as collateral, B.'s debt continues to exist, and this serves to distinguish such a case from one of novation, in which B.'s debt would be extinguished.

A collateral obligation may be validly assumed by one party to pay the debt of another party, and may be enforced without effecting a discharge of the original obligor.

COUNSEL Maxwell & Reeves, for plaintiff in error.

Blount & Blount & Carter, for defendant in error.

OPINION

TAYLOR J.

The plaintiff in error, as plaintiff below, sued the defendant in error in the circuit court of Escambia county in an action of assumpsit; the declaration being as follows:

'The plaintiff sues the defendant for money payable by the defendant to the plaintiff for goods, wares, and merchandise sold and delivered by the plaintiff to a late copartnership known as Gray & Goodman, and composed of the defendant and one Paul Gray, who died prior to the institution of this suit; and the plaintiff claims $4,000.'

To this declaration the defendant filed the following plea:

'That after the accrual of the said alleged indebtedness by the said Gray & Goodman to the plaintiff, the said Paul Gray, one J. R. Brown, and one J. D. Lamar formed a copartnership under the name of Gray & Co., and the said Paul Gray and the defendant sold to the said Gray & Co. the stock and business theretofore belonging to and conducted by the said Gray &amp Goodman, and the said Gray & Goodman agreed, as a consideration of such purchase, that it, the said Gray & Co., would assume and pay the debts of the said firm of Gray & Goodman, including the debts sued upon in the declaration, and the said firm of Gray & Co. notified the plaintiff of the said sale and of the said assumption of said debts, and plaintiffs, in consideration of the said assumption, agreed to release, and did release, this said defendant from liability for said debts, and thereafter sued in the circuit court of Escambia county, Fla., the said Gray, Brown, and Lamar upon the said assumption; and thereafter, the said Gray, Brown, and Lamar having been adjudged bankrupts by the District Court of the United States for the Northern Judicial District of Florida, plaintiff filed, as due to it by the said bankrupts, in the said bankrupt court and in said proceedings, a claim for the indebtedness due it by Gray & Co., and included in said claim the alleged indebtedness sued on in the declaration herein, and received from the said court, as a dividend apportioned to said indebtedness, a large sum of money.'

To this plea the plaintiff filed the following replications:

'The plaintiff, for replications to the plea of defendant, C. C. Goodman, filed herein says:

'(1) That it is not true that the plaintiff, in consideration of the assumption of the indebtedness of the said Gray & Goodman by the said Gray, Brown, and Lamar, in accepting said assumption of liability, released or agreed to release the said Gray & Goodman from liability for said debt.

'(2) That it is not true that the plaintiff, in consideration of the assumption of the indebtedness of the said Gray & Goodman, by the said Gray, Brown, and Lamar, in accepting said assumption of liability, released or agreed to release the said Gray & Goodman from liability for said debt, but, on the contrary, accepted the said assumption or liability by the said Gray, Brown and Lamar as an additional or further security for said indebtedness.

'(3) And it is not true that the plaintiff, in consideration of the assumption of the indebtedness of the said Gray & Goodman by the said Paul Gray, J. R. Brown, and J. D. Lamar, copartners as Gray & Co., in accepting said assumption of liability, released or agreed to release the said Gray & Goodman from liability for said debt.

'That the plaintiff is and from its organization has been a corporation organized under the laws of the state of Missouri, with its principal place of business at St. Louis, in that state; that the indebtedness herein sued upon was payable at that place by the said Gray and Goodman and Rader, and the offers of assumption of indebtedness or liability by the said Paul Gray and C. C. Goodman, copartners as Gray & Goodman, and by Paul Gray, J. R. Brown, and J. D. Lamar, copartners, as Gray & Co., were made to it at that place, and accepted by it at that place; and that by the laws of Missouri such assumption of indebtedness or liability by the said respective copartnerships and acceptance thereof by plaintiff did not operate as a novation or a discharge of the liability of the said original parties to--i. e., Paul Gray, C. C. Goodman, and I. N. Rader, or his estate, or of Paul Gray and C. C. Goodman, copartners as Gray & Goodman.

'(4) That it is not true that the plaintiff, in consideration of the assumption of the indebtedness of the said Gray & Goodman by the said Paul Gray, J. R. Brown, and J. D. Lamar, copartners as Gray & Co., in accepting said assumption of liability, released or agreed to release the said Gray & Goodman from liability for said debt, but, on the contrary, accepted the said assumption of liability by the said Gray, Brown, and Lamar, copartners as Gray & Co., as an additional or further security for said indebtedness.

'That the plaintiff is and from its organization has been a corporation organized under the laws of the state of Missouri, with its principal place of business at St. Louis, in that state; that the indebtedness herein sued upon was payable at that place by the said Gray, Goodman & Rader, and the offers of assumption of indebtedness or liability by the said Paul Gray and C. C. Goodman, copartners as Gray & Goodman, were made to it at that place and accepted by it at that place; and that by the laws of the state of Missouri such assumption of indebtedness or liability by the said respective copartnerships and acceptance thereof by plaintiffs did not operate as a novation or as a discharge of the liability of the said original parties to--i. e., Paul Gray, C. C. Goodman, and I. N. Rader, or his estate, or of Paul Gray and C. C. Goodman, copartners as Gray & Goodman.'

To these replications the defendant filed the following demurrer:

'The defendant demurs to the first replication to his plea filed November 30, 1906, and for cause of demurrer says:

'(1) That the allegations of the said replication are conclusions of law and not averments of facts.

'(2) That, if the said allegations were intended as averments of fact, they take issue upon immaterial allegations of the plea.

'(3) That the alleged fact that the plaintiff did not release or agree to release Gray & Goodman for liability for the indebtedness sued on is no answer to the defense set up in the plea.

'The defendant demurs to the second replication to his plea filed on November 30, 1906, and for cause of demurrer says:

'(1) That the allegations of the said replication are conclusions of law and not averments of fact.

'(2) That, if the said allegations were intended as averments of fact, they take issue upon immaterial allegations of...