Koch v. Lay

• Decision Date: 31 March 1866
• Citation: 38 Mo. 147
• Parties: ALBERT KOCH, Respondent, v. JOHN F. LAY, GARNISHEE OF WEBSTER COLLEGE, Appellant.
• Court: Missouri Supreme Court

38 Mo. 147

ALBERT KOCH, Respondent,

v.JOHN F. LAY, GARNISHEE OF WEBSTER COLLEGE, Appellant.

Supreme Court of Missouri.

March Term, 1866.

Appeal from St. Louis Court of Common Pleas.

Cline & Jamieson, for appellant.

In an action on a contract or note, if there has been an entire failure of the consideration after the giving of such note, even though originally there may have been no want of consideration, this forms a good cause of defence in an action on such notes, as between the original parties, or those claiming under them, who are subject to the same equities. And even a subsequent partial failure of consideration constitutes a good defence pro tanto; provided it is of such a nature as to be capable of definite computation, and not mere unliquidated damages--R. C., p. 1290, § 24; Harrington v. Stratton, 22 Pick. 516. There would seem to be no difference in principle between the present case and those cases where a note is given in consideration of the conveyance of land by deed, with the usual covenants of warranty and seizin, and where, if the title to the land fails entirely, it is held to afford a good defence to the note; and this, though he may have been in possession for a time, and have his remedy by cross-action on the covenants--Frisbee v. Hoffnagle, 11 Johns. 50; McAlister v. Raab, 4 Wend. 483; Steinhauer v. Witman, 1 S. & R. 447; Chandler v. Marsh, 3 Vt. 162; Tillotson v. Grapes, 4 N. H. 448. And generally it may be said that in States where the rigidity of the common law pleading has become released, there seems to be a growing tendency, and in most States it may be regarded as already established as a rule, that as between the original parties, in an action on a promissory note, any defence growing out of the consideration upon which the note is based, which is meritorious, may be set up, the object being to obviate the trouble and expense of cross-actions--Barr v. Baker, 9 Mo. 854; Wade v. Scott, 7 Mo. 509; Wells v. Hopkins, 5 M. & W. 7; Harrington v. Stratton, 22 Pick. 510. In the last case, the cases are carefully reviewed on this point.

Knox & Smith, for respondent.

WAGNER, Judge, delivered the opinion of the court.

Plaintiff recovered judgment against Webster College, and summoned defendant as garnishee. The defendant, in his answers to the interrogatories propounded to him touching his indebtedness, denied that he owed Webster College at the time of the service of the garnishment, but stated that he executed and delivered to the college, several years prior to that time, five several promissory notes, for one hundred dollars each, which notes were given in consideration of certain privileges and franchises, to be secured to him by the college, and to be by him enjoyed; that the consideration for said notes had entirely failed; that he was induced to execute them by reason of the false representations of the pecuniary condition and possessions of the college, without which representations, he would not have executed them; and that he never received any consideration for said notes.

The truth of these statements was put in issue. The trial was had before a jury, and a verdict rendered for the plaintiff. The record discloses that Webster College was incorporated by an act of the Missouri Legislature; that an organization wes effected, and that Dr. Bullard was elected president of the board of trustees. The corporation possessed no money, and it sought to raise an endowment fund, and to erect suitable buildings, by the sale of scholarships. To carry out this policy, and to afford easy terms to the purchasers of...