Kessler v. Clayes

• Decision Date: 01 February 1910
• Parties: KESSLER v. CLAYES.
• Court: Missouri Court of Appeals

125 S.W. 799

147 Mo. App. 88

KESSLER v. CLAYES.

St. Louis Court of Appeals. Missouri.

February 1, 1910.

Rehearing Denied February 21, 1910.

1. EVIDENCE (§ 461) — PAROL EVIDENCE — WRITTEN CONTRACT — SURROUNDING CIRCUMSTANCES.

While direct evidence as to the intention of the parties to a written contract is incompetent, parol evidence is competent to show the parties' situation, the surrounding circumstances, and the relation which the words of the writing may bear to the subject-matter of the contract.

2. EVIDENCE (§ 402) — PAROL EVIDENCE — NOTES.

Since parties to a note are presumed to have placed their entire engagement in writing, if the note imports a legal obligation with certainty, parol evidence is inadmissible to destroy its obligation as such, and to show that it was intended as a mere receipt, in the absence of fraud, mistake, illegality or want of consideration.

3. CONTRACTS (§ 167) — CONSTRUCTION — LEGAL IMPORT.

The legal import of every undertaking is a part of the contract as well as the obligations expressly contained therein.

4. BILLS AND NOTES (§ 41) — NATURE OF CONTRACT — CONSTRUCTION — "SURRENDERED."

Plaintiff on surrendering certain stock to decedent, received from him an instrument containing the words "Good for $1,000.00 * * * for ten shares Kinloch Jockey Club stock surrendered to the undersigned, * * * by the owner of said stock J. Kessler and for which I am liable. Joseph D. Lucas." Held, that the word "surrendered" did not mean mere delivery, but imported a transfer of title, a giving up or making over, a relinquishment of a right or privilege, and that the words "Good for $1,000.00" and "for which I am liable" imported a promise on decedent's part to pay plaintiff $1,000 for the stock, so that the instrument contained all the elements of a note as between the parties.

5. BILLS AND NOTES (§ 28) — REQUISITES.

The essential elements of a note are that it must be in writing, must contain a promise to pay either express or implied, that the promise must be for the payment of a certain sum of money absolutely and at all events, that the promise must be unincumbered with collateral agreements to do something else, and that the instrument must indicate with certainty the parties to the contract.

6. BILLS AND NOTES (§ 32) — ELEMENTS — IDENTITY OF PAYEE.

A note sufficiently identifies the payee if it discloses from whom the consideration was received.

7. EVIDENCE (§§ 419, 451) — PAROL EVIDENCE — NOTES.

Parol evidence is inadmissible to remove a patent ambiguity on the face of the note, when to do so involves either adding to or subtracting from the language employed, but is admissible to explain the consideration which is always open to contradiction, as between the parties as provided by Rev. St. 1899, § 645.

8. APPEAL AND ERROR (§ 934) — VALIDITY OF JUDGMENT — PRESUMPTION.

Where a judgment for defendant was appealed from, and the precise ground on which it was based did not appear, but there were no erroneous declarations of law, it would be affirmed if it could be sustained on any theory of the law within the pleadings.

9. COURTS (§ 202) — PROBATE COURTS — PLEADINGS.

No formal pleadings are required in proceedings in probate court as provided by Rev. St. 1899, § 200 (Ann. St. 1906, p. 408).

10. COURTS (§ 202) — PROBATE COURTS — APPEAL FROM PROBATE — PLEADINGS.

Since an appeal from a probate decree is required to be tried anew in the circuit court by Rev. St. 1899, § 285 (Ann. St. 1906, p. 438), on the pleadings as before, no formal pleadings are required in the circuit court.

11. BILLS AND NOTES (§ 518) — CONSIDERATION — EVIDENCE — FINDINGS.

In an action on a note, evidence held to warrant a finding that there was no consideration from the maker to plaintiff therefor, but that the instrument was given to represent plaintiff's rights under a corporation reorganization agreement by virtue of certain stock in an insolvent corporation, delivered by plaintiff to decedent for exchange.

Appeal from Circuit Court, St. Charles County; James D. Barnett, Judge.

Action by Julius Kessler against George Clayes, as administrator de bonis non with the will annexed, of the estate of Joseph D. Lucas, deceased. Judgment for defendant, and plaintiff appeals. Affirmed.

W. G. Schofield, for appellant. T. J. Rowe and T. J. Daly, for respondent.

NORTONI, J.

This is a suit on a promissory note. The trial was had before the court without a jury. After taking the case under advisement, judgment was given for defendant, and the plaintiff appeals. The plaintiff filed the instrument sued upon as a demand against the estate of J. D. Lucas, deceased, in the probate court of St. Louis county. It was allowed, and the estate appealed to the circuit court. Afterwards, a change of venue was awarded to the circuit court of St. Charles county from whence comes the present appeal. The instrument sued upon is as follows: "Bridgeton, Mo., Nov. 28, 1902. Good for $1,000.00, one thousand dollars, for ten shares Kinloch Jockey Club stock surrendered to the undersigned, J. D. Lucas, by the owner of said stock J. Kessler and for which I am liable. Joseph D. Lucas." It is to be noted that the instrument bears date prior to the enactment of our negotiable instrument law of 1905, and the case is to be treated wholly irrespective of the provisions of that act.

We are unable to say upon what theory the court gave judgment for the defendant. No declarations of law were given, and we are therefore unaided by anything in the record indicating the views of the court as to the law of the case. It is true the court refused one request by the plaintiff, but as this declaration failed to hypothesize all of the relevant facts in proof, it is of course presumed to have been refused for that reason. Although it is not clear on what theory the court gave judgment for the defendant, its judgment is sought to be sustained here on the proposition that the instrument sued upon is not a promissory note. If such is the theory of the judgment, then we believe it to be erroneous. On the other hand, if the judgment of the court was given for defendant on the theory that there was a failure of consideration for the note, then we believe it may be sustained. The argument advanced by the defendant is to the effect that the instrument in suit is not a note, but is rather merely a receipt which the deceased executed to the plaintiff for 10 shares of stock in the Kinloch Jockey Club. It is said the instrument is ambiguous in its terms, and therefore it is proper to receive parol testimony showing the situation of the parties and the circumstances surrounding them, to the end of elucidating the intention in that behalf. Generally speaking, if the intention of the parties sought to be set forth in a written contract is not clear because of ambiguous language used therein, the ambiguity may be removed and the intention of the parties clarified by parol testimony to the extent mentioned. In other words, while direct evidence as to the intention is incompetent, it is always competent to receive parol testimony to the end of showing the situation of the parties, the surrounding circumstances, and the relation which the words of the writing may bear to facts which constitute the subject-matter of the contract. Ellis v. Harrison, 104 Mo. 270, 16 S. W. 198; Davis v. Davis, 8 Mo. 56; Bell v. Dawson, 32 Mo. 79; Campbell v. Johnson, 44 Mo. 247; Carter v. Holman, 60 Mo. 498; Laclede Construction Co. v. Moss Tie Co., 185 Mo. 25, 84 S. W. 76; Greenleaf on Evidence, § 288. Be this as it may, except in cases where from fraud, mistake or illegality, the instrument has not acquired original force as a contract, parol evidence is inadmissible to vary, contradict, add to, or subtract from the terms of a written instrument. The rule proceeds upon the presumption that the parties have placed their entire engagement in writing, therefore, if the instrument imports a legal obligation with certainty, it alone shall be permitted to give evidence as to the terms of the agreement. Tracy v. Union Iron Works Co., 104 Mo. 193, 16 S. W. 203; Laclede Construction Co. v. Moss Tie Co., 185 Mo. 25, 84 S. W. 76; Greenleaf on Evidence, § 275. Under this rule, it is clear that if the instrument sued upon is a promissory note, then parol testimony is incompetent to destroy its obligation as such and show it to be a receipt instead. As to the general proposition that a promissory note may not be shown by parol to have been intended as a mere receipt, see the following authorities in point: Billings v. Billings, 10 Cush. (Mass.) 178; Dickson v. Harris, 60 Iowa, 727, 13 N. W. 335; Daniels on Negotiable Instruments (5th Ed.) § 80. But it is said the instrument is not a promissory note for the reason it contained no promise to pay. It is sufficient if such a promise is either expressed in words or is raised by the law as a necessary implication on an acknowledgment of indebtedness therein contained. Daniels on Negotiable Instruments, § 37. There are numerous cases in the books in this state and elsewhere to the effect that mere due bills are promissory notes within the meaning of the law even though no promise to pay the indebtedness acknowledged to be due is expressed in words therein. See the following: McGowen v. West, 7 Mo. 569, 38 Am. Dec. 468; Finney v. Shirley, 7 Mo. 42; Brady v. Chandler, 31 Mo. 28; Jacquin v. Warren, 40 Ill. 459; Locher v. Kuechenmiester, 120 Mo. App. 701, 98 S. W. 92. And so a paper reciting "received of H. Doane for Samuel A. Reyburn, $180.00, Potosi, November 16, 1850," signed J. H. Casey, was declared to be a note upon which Reyburn, the third party, in whose favor the money was received by Casey, could maintain an action; the principle asserted being that the acknowledgment of having received the money payable to Reyburn raised a promise by implication of law to pay the same to the party named. Reyburn v. Casey, 29 Mo. 129.

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