Johnson v. Schar

• Decision Date: 06 April 1897
• Parties: JOHNSON, Plaintiff and appellant, v. GEORGE SCHAR and WIEBKE SCHAR, Defendants and respondents.
• Court: South Dakota Supreme Court

9 S.D. 536

70 N.W. 838

JOHNSON, Plaintiff and appellant, v. GEORGE SCHAR and WIEBKE SCHAR,

Defendants and respondents.

South Dakota Supreme Court

Appeal from Circuit Court, Lawrence County, SD

Hon. A. J. Plowman, Judge

Affirmed

Frawley & Laffey, Deadwood, SD

Attorneys for appellant.

Martin & Mason, Deadwood, SD

Attorneys for respondents.

Opinion filed April 6, 1897

CORSON, P. J.

This was an action to recover upon a promissory note of which the following is a copy:

“$450. Spearfish, South Dakota, July 7th, 1893. Three months after date, for value received, we promise to pay to the order of the Welcome Milling & Smelting Co. four hundred and fifty dollars, with interest at 10 per cent per annum from date until paid, and with attorneys fees in addition to other costs in case the holder is obliged to enforce payment at law. Payable at the Bank of Spearfish, Spearfish, South Dakota. [Signed] George Schar. Wiebke Schar.”

Indorsed: “July 10th, 1893. Pay to the order of Bond & Johnson. The elcome Milling & Smelting Co., per P. L. Gibbs, Supt.” Indorsed; “Bond & Johnson.” The defendants pleaded that the note was given in payment of a subscription made to secure the erection of reduction works near Spearfish City, and that there were conditions in the subscription agreement that had never been complied with on the part of the payee of the note. The evidence was undisputed that the plaintiff became the owner of the note before its maturity. All evidence offered by the defendants tending to prove their defense was objected to by the plaintiff and appellant upon the ground that the note was negotiable, and the evidence inadmissible as against the plaintiff, who acquired title to the note before its maturity. The objection was overruled, and the evidence admitted, and a verdict rendered in favor of the defendants; and from the judgment rendered thereon, and the order denying a new trial, the plaintiff appeals. The first question, therefore, to be considered, will be as to the negotiability of the note. The respondents contend that the note is nonnegotiable, for three reasons: (1) The amount to be paid is uncertain; (2) it contains a condition not certain of fulfillment—that is, whether the holder will ever be obliged to enforce payment at law; and (3) it contains a contract other than such as is specified in the Code. The respondents concede that under the decision of this court in Chandler v. Kennedy,(1895), the question of attorney fees is eliminated from this case, and it need not, therefore, be considered. But the respondents insist that the note also embraces an agreement to pay “other costs,” which renders the amount to be paid uncertain. Their contention is that, omitting the attorney’s fees, the clause constitutes an agreement to pay costs, the amount of which is uncertain. The appellant argues that “other costs” simply refers to the legal costs collectible in case of an action, flxed and determined by statute; that the term “costs” has a well defined legal meaning, and that the court will construe the clause in the note with reference to that fact. But we do not feel at liberty to thus construe the clause. If the parties intended by the terms used only the legal costs taxable in case an action should be brought upon the note, there was no necessity for the insertion of the clause in the note, “other costs.” It would have been sufficient to have said “with attorney’s fees” to have expressed the intention of the parties, if attorneys’s fees were all that was intended to be contractcd for. Substantially the same clause was considered by the circuit court of appeals in 1894, in a case that went up from the United States circuit court of this circuit, and that court held that “costs of collection” inserted in the note in that case rendered it non-negotiable. Bank v. Basuier, 12 CCA 517, 65 Fed. 58. In that case the clause was, “with exchange and costs of...