Jenckes v. Rice

• Decision Date: 04 February 1903
• Citation: 93 N.W. 384,119 Iowa 451
• Parties: ROY C. JENCKES, Appellant, v. JOHN E. RICE, et al
• Court: Iowa Supreme Court

93 N.W. 384

119 Iowa 451

ROY C. JENCKES, Appellant, v. JOHN E. RICE, et al

Supreme Court of Iowa, Des Moines

February 4, 1903

Appeal from Polk District Court.--HON. C. P. HOLMES, Judge.

THIS is an action at law to recover on the following instrument "$ 2,000.00. Des Moines, Iowa May 4th, 1890. Six months after date, for value received, we jointly and severally, as principal, promise to pay to the order of Spencer M. Rice the sum of two thousand dollars, with interest at the rate of ten per cent. per annum from date if not paid at maturity, and attorney's fees if suit is instituted upon this note. This note is given to secure S. M. Rice against the loss of $ 2,000 subscription in the syndicate of the Gray's Harbor Land & Imp. Co., and is void and nonpayable whenever said $ 2,000 shall have been derived from said syndicate. John E Rice." A brief history of the transactions connected with it are stated herein. John E. Rice was promoting the sale of stock in the syndicate of the Gray's Harbor Land & Improvement Comany, a concern in which he had a financial interest. In April, 1890, he visited his codefendant and brother at his home in Terre Haute, Ind., and tried to sell him some of the stock, but without success at that time. Some little time thereafter he reached Des Moines. In the meantime the plaintiff and the defendant, Spencer M. Rice, had concluded they would each take $ 1,000 of the stock in question. Thereupon the latter telegraphed John E. Rice at Des Moines, Iowa asking if he could get $ 2,000 of the stock. The answer by telegram was: "To Dr. S. M. Rice: Of course. Same offer. Deposit money as before. * * * Rush by Tuesday." After sending this telegram, John E. Rice executed and forwarded to Spencer M. Rice at Terre Haute the instrument sued on. Jenckes and Spencer M. Rice borrowed $ 2,000 of a Terre Haute bank on their joint note, and put it into this stock. This note was renewed several times, but was finally surrendered, and the individual notes of Jenckes and Rice for one-half of the amount, each, accepted in its place and Rice deposited the instrument sued on and the certificate of his interest in the land of the improvement company as collateral security for his note. Jenckes put up collateral security for his own note and for Rice's note, which latter fact was, however, unknown to Rice. Rice did not pay his note, and the bank served notice on both him and Jenckes that the collateral given by them would be sold at public auction, and the proceeds applied on their debts. The collateral given by Rice was sold at such sale to the plaintiff, the instrument in suit for $ 30 and the certificate for $ 20, the total amount of which was just enough to pay the costs of the sale. Jenckes thereupon paid the bank the amount due on Rice's note, took the same and brought suit and recovered a judgment thereon before the judgment in this case was rendered, and that judgment has since been paid. This action is to recover $ 2,000 and interest against John E. Rice as maker and Spencer M. Rice as indorser of the instrument set out. There was a directed verdict for the plaintiff against both defendants for the full amount thereof, principal and interest. The court adjudged, however, that the sale of the collateral to Jenckes did not vest the absolute ownership thereof in him, but simply subrogated him to the rights of the bank; and it was ordered that upon payment of the judgment against Spencer M. Rice on his note to the bank, and the taxes and interest thereon paid on his interest in the syndicate land, the judgment herein be assigned to Spencer M. Rice, and that he be subrogated to the plaintiff's interest therein. Both parties appeal. The plaintiff, having first perfected his appeal, will be designated as the appellant.--Affirmed on plaintiff's appeal, and on defendants' appeal reversed.

Judgment AFFIRMED on the plaintiff's appeal, and on the defendants' REVERSED.

Dudley & Coffin for appellees.

St. John & Stevenson for appellants.

SHERWIN J. BISHOP, J., took no part.

OPINION

SHERWIN, J.

The defendant John E. Rice was a resident of the state of Washington when he executed the instrument in suit, and has ever since resided there, while the plaintiff was then and still is a resident of Indiana. We need not determine however, whether the action was barred by the Washington statute pleaded and proven, because we find that such bar, if it ever existed, was removed by the defendant's new promise in writing to pay in his letter to Spencer M. Rice under date of February 24, 1893, in which he said, "I cannot tell where I can get money enough to pay the note, but, as true as God, I will send it as soon as I can get it." The contention that this language may have referred to the individual note which Spencer had given the bank is not sustained by the record. The letter refers to the instrument in suit directly and explicitly in other parts...