Henson v. Henson

• Decision Date: 07 February 1925
• Citation: Henson v. Henson, 268 S.W. 378, 151 Tenn. 137 (Tenn. 1925)
• Parties: HENSON ET UX. v. HENSON ET AL.
• Court: Tennessee Supreme Court

268 S.W. 378

151 Tenn. 137

HENSON ET UX. v. HENSON ET AL.

Supreme Court of Tennessee.

February 7, 1925

Appeal from Chancery Court, Sequatchie County; T. L. Stewart Chancellor.

Suit by L. A. Henson and wife against J. A. Henson and another administrators, etc., in which answer was filed as cross-bill. From decree of Court of Civil Appeals reversing judgment dismissing original bill and sustaining cross-bill defendants appeal. Decree of Court of Civil Appeals affirmed.

McKINNEY J.

The question for decision is this: Where the testator purposely destroys a note by burning it, does it operate to discharge the debt?

The bill alleges that on the 21st day of September, 1915, the complainants purchased of W. R. Henson, the father of the complainant, L. A. Henson, several tracts of land in Sequatchie county, and on said day said W. R. Henson executed a deed conveying said lands to complainants. A copy of said deed is exhibited with the bill, in which the descriptions of the lands are given.

The bill further alleges that the consideration for said conveyance was $2,500, $500 of which was to be paid without interest twelve months from the date of the deed, which was evidenced by a note, and five notes for $400 each were executed payable in two, three, four, five, and six years respectively, from date; that a lien was retained on the land to secure the payment of the principal and interest on the notes; that the first note was paid to W. R. Henson during his lifetime; that W. R. Henson died intestate in February, 1920; that a short time before his death W. R. Henson declared to members of his family, and to others, his intention of forgiving the complainants the indebtedness represented by said notes; that, in order to carry out this intention, he directed Mrs. Lula Henson, wife of the defendant J. A. Henson, to burn said notes, which she did; and that said W. R. Henson made no other or further claim on complainants because he had forgiven said indebtedness.

The prayer of the bill was for a decree declaring a release, discharge, and forgiveness of said indebtedness freeing and relieving the land of any lien by reason of the execution of said notes.

The answer admits the execution of the deed and notes as set out in the bill, and contains the following recitals:

"It is true that these notes were owned by W. R. Henson and that they were retained in his possession. It is also true that a short time before his death he said to J. A. Henson and his wife, Lula Henson, that he did not intend to collect these notes, but still retained these notes in his possession on up until just before his death.

After that some time, and on a different occasion, he said to Lula Henson and J. A. Henson that he did not intend to collect the notes unless he should need them for his support and maintenance, and in the absence of J. A. Henson, these respondents are informed that he ordered Lula Henson, or directed her to burn up these notes, which she did."

The answer further alleges:

"These respondents are advised that this action of W. R. Henson in burning these notes did not in law release the complainant and his wife from the payment of the notes. Such action was not binding upon W. R. Henson, and that if he were alive to-day, he could sue and collect these notes."

The answer was also filed as a cross-bill, and sought a recovery against complainants upon said notes and to have said lands sold to satisfy the decree.

Answer was duly made to the cross-bill, in which the allegations of the original bill were reiterated.

The chancellor dismissed the original bill and sustained the cross-bill.

Upon appeal the Court of Civil Appeals reversed the chancellor, sustained the original bill, dismissed the cross-bill, and the defendants have appealed and assigned numerous errors.

Only two parties testified in the case. They were introduced by complainants, and testified as follows:

"Lula Henson, wife of defendant J. A. Henson, testified that she was acquainted with W. R. Henson in his lifetime, and that W. R. Henson died some time in February, 1920, or about that time. That some years before his death he lived in the home of the witness and her husband. That he conveyed to L. A. Henson and his wife a tract of land for which Henson and his wife executed notes for the purchase money. That about one year before he died, and while he was still at the home of the witness, W. R. Henson declared his purpose to release these notes, and directed the witness to get the notes and destroy them and thereby release the said Henson of any balance due on said tract of land. The witness did not destroy the notes on this occasion, but about six or seven months after this, and about five or six months before the death of the said W. R. Henson, he brought the subject up again, and W. R. Henson again directed the witness to get the notes and destroy them, and thereupon the said witness did get the notes that were then in the possession of W. R. Henson and burned them up. This was done at the request of the said Henson. The said Henson had often expressed a desire to give the property to L. A. Henson and said he did not expect these notes to be collected.

Charles D. Cain testified that he was personally acquainted with W. R. Henson for many years, being a neighbor, and talked with him frequently in regard to his business. On one occasion, about six months before hs death, in talking to him about his business, he referred to certain notes executed by his son, L. A. Henson, for land, and said if he needed the proceeds of said notes to support him during his lifetime, he expected to realize on them, but that he might not live long, and in the event of his death he did not want these notes collected; that he expected to give his son these notes. The reason given for this was that his son was a man not in good health, and besides he had lived with him a great number of years after he had attained his majority, and had helped to make the money to help him out of his financial difficulties. Mr. Henson made it very plain to the witness that he did not expect these notes to be collected in the event of his death before they were collected."

1. Counsel for defendants insist that a cancellation or discharge of a debt must be in writing in order to be effective, and base their insistence upon section 122 of the Negotiable Instruments Act (Laws 1899, c. 94), which is as follows:

"The holder may expressly renounce his rights against any party to the instrument, before, at, or after its maturity. An absolute and unconditional renunciation of his rights against the principal debtor, made at or after the maturity of the instrument, discharges the instrument. But a renunciation does not affect the rights of a holder in due course without notice. A renunciation must be in writing, unless the instrument is delivered up to the persons primarily liable thereon."

Upon the other hand, it is insisted by counsel for complainants that a cancellation or discharge, such as that appearing in the instant cause, does not have to be in writing, and they rely upon section 119 of the Negotiable Instruments Act, which is as follows:

"A negotiable instrument is discharged:

(1) By payment in due course, by or on behalf of the principal debtor;

(2) By payment in due course, by the party accommodated, where the instrument is made or accepted for accommodation;

(3) By the intentional cancellation thereof by the holder;

(4) By any other act which will discharge a simple contract for the payment of money;

(5) When the principal debtor becomes the holder of the instrument at or after maturity in his own right."

When the two sections above quoted are construed together, it is apparent that they are neither inconsistent nor in conflict. Section 119 provides five acts which constitute a discharge. Section 122 provides that a note may (also) be discharged by renunciation provided the renunciation is in writing. In the first section the Legislature did not see proper to require that the discharge be in writing, while in the other section it did. It is unnecessary to discuss the reason for this distinction.

In Lockhart State Bank v. Baker (Tex. Civ. App.) 264 S.W. 568, this question was involved, and the court, in its opinion, said:

"The question, therefore, is whether subdivision 4, § 119, Negotiable Instruments Act (article 6001--119), providing that a negotiable instrument may be discharged by any act which would discharge a simple contract for the payment of money, is limited or controlled by article 6001--122, relating to discharge of such instrument by express renunciation, and requiring it to be in writing. Appellant's contention has been recently decided adversely to it in the case of Hall v. Wichita State Bank & Trust Co., 254 S.W. 1036, in a well-considered opinion by the Amarillo Court of Civil Appeals, and in which a writ of error was refused by the Supreme Court November 12, 1923. We quote the following from this opinion:

'From what has been said it seems apparent to us that it was the intention of the lawmakers by section 122 to deal with the formal and express release of the common law, and by the provisions of section 119, par. 4, to continue in effect other recognized methods of discharging obligations of this character. An express release is not necessary to a discharge by novation. The intention or agreement to accept the new obligation in lieu and discharge of the old may be implied.'

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