Leach v. Nelson
| Decision Date | 23 May 1922 |
| Citation | 189 N.W. 251,48 N.D. 1046 |
| Court | North Dakota Supreme Court |
Action in District court, Ramsey county, Burr, J.
From a judgment ordered bye the trial court the defendants have appealed.
Reversed and a new trial granted.
New trial granted.
Flynn Traynor & Traynor, for appellants.
The general rule is to allow amendments; to refuse is the exception. Nashua Savings Bank v. Lovejoy, 1 N.D 211; Anderson v. Bank, 5 N.D. 80; Bigelow v Draper, 6 N.D. 152; Finlayson v. Peterson, 11 N.D. 45; Sheterlund v. Deal, 12 N.D. 123; Kerr v. Grand Forks, 15 N.D. 294; Barker v. More, 18 N.D. 82.
It is the rule to interpret liberally the right to amend and that a variance between the pleading and the proof shall not be deemed material unless it has actually misled the adverse party. Maloney v. Geiser Mfg. Co., 17 N.D. 195; Robertson v. Mosea, 15 N.D. 351; Halloran v. Holmes 13 N.D. 411.
"It is a defense to an action on a note by the payee against the maker that it was given under an agreement that no suit should be brought thereon against the maker." 8 C. J. 741; Richardson v. Thomas, 38 Ark. 387; Monroe v. Martin (Ga.) 73 S.E. 341.
"It is essential to an equitable estoppel that the person asserting the estoppel shall have done or omitted some act or changed his position in reliance upon the representations or conduct of the person sought to be estopped." 21 C. J. 1080 and 1113, also 21 C. J. 1133.
"An obligation is extinguished by a release therefrom given to the creditor, upon a new consideration, or in writing, with or without new consideration." Section 5833, Compiled Laws of N.D. 1913; National Bank v. Guthrie, (S.D.) 78 N.W. 995.
If it appears that the facts are such that amendment can be made and that thereby on a new trial a different result would be likely, in other words, if it appears that justice has not been done, at least a new trial should be granted. Reick v. Daigle, 17 N.D. 365; Welch v. N. P. Ry. Co., 14 N.D. 19; Mechan v. G. N. Ry. Co., 13 N.D. 432; Kerr v. Anderson, 16 N.D. 36; Aetna v. Schroeder, 13 N.D. 10.
A. E. Wheeler, and Middaugh, Cuthbert & Smythe, for respondent.
The testimony under consideration in this case does not come within any of the recognized rules for the admission of parol testimony. Its purpose and effect was to establish a contract different in terms from that of the written contract. This testimony should have been excluded, and its admission was prejudicial error. First Nat. Bank v. Prior, 10 N.D. 146, 86 N.W. 362; Sargent v. Cooley, 12 N.D. 1, 94 N.W. 576; Rieck v. Daigle, 17 N.D. 365, 117 N.W. 346, 17 Cyc. 589, 644 2 Enc. Ev. 453; Dan. Neg. Inst. 80; 4 Am. & Eng. Enc. Law 2d ed. 146; See also 5889, Comp. Laws 1913.
It is elementary that, when separate writings are executed between the same parties at the same time, in the course and as parts of the same transaction and intended to accomplish the same general object they are construed as one and the same instrument, etc." 8 C. J. under the topic of Bills and Notes, p. 196.
The same rule is true with reference to subsequent agreements. Foster v. Furlong, 8 N.D. 282; Heaton v. Myers, 4 Colo. 59; Swan v. Craig, (Neb.); Marshall Field Co v. Oren Ruffcorn, (Ia.) 90 N.W. 618; Bank v. Kelley, 30 N.D. 84.
Statement.
This is an action upon a promissory note. The plaintiff is a resident of Minneapolis; the defendants reside in the state of Washington. Jurisdiction was secured by attaching certain real estate owned by the defendant A. L. Nelson. The complaint alleges the making of a promissory note for $ 1,000, secured by a mortgage upon realty in Minneapolis; that at the time of making the note there was a prior mortgage upon such realty; that such mortgage has been foreclosed and absolute title has ripened in the holder thereof, through failure of the defendants to redeem, by reason whereof the plaintiff has no security for the payment of the note. The answer admits the making and the non-payment of the note. It alleges that the mortgaged real estate was deeded to the defendant A. L. Nelson; that he gave a mortgage to the plaintiff; that thereafter the defendants obtained the plaintiff's permission to sell the mortgaged property, and his release and discharge of any further liability upon the note; that upon obtaining such release and discharge they transferred such property; that, if plaintiff has suffered any loss through the foreclosure of the mortgage, it has occurred through his carelessness and neglect in failing to make redemption.
At the commencement of the trial, the defendants moved to amend the answer by alleging that at the time of making the note it was agreed that the defendants should not be held personally liable thereon, and that the plaintiff would rely solely upon the real estate security. Upon objection of the plaintiff the court overruled the motion. Later, at the trial, the defendants again moved to amend, as above stated, and, further, that the note was delivered conditionally upon the agreement that plaintiff would not hold the defendants personally liable, that he would rely solely upon the real estate security, and that defendants would not have delivered such note excepting upon such representations and agreements. Again, the trial court, upon objection made, overruled the motion. The court stated that the defendants could show a conditional delivery but they could not vary the terms of a written instrument; that if the defense was a good defense the court would allow it. The court suggested that the defendants should make an offer of proof. The defendants requested that the court permit them to introduce their testimony over objection so that they might not be compelled to again retry the case. The trial court, expressing doubt upon the questions, stated that he would allow the introduction of the testimony. Later, when testimony was offered concerning a conditional delivery, the court stated that he had allowed the first amendment offered; that the amendment concerning the conditional delivery was still another offer which the court would reject. Defendants then offered to prove that at the time of delivering the note the plaintiff knew and agreed that the defendants were signing such note upon the understanding that they would not be held personally liable, that the plaintiff would look solely to the real estate security for the payment thereof, and that the note should not be delivered unless he so consented. This offer was rejected. At the conclusion of the evidence the defendants again renewed their motion to amend the answer as requested, upon the ground that the evidence introduced justified such proposed amendments, and that same would not operate to the prejudicial disadvantage of the plaintiff. The court overruled the motion so far as conditional delivery was concerned and reserved ruling upon the other. Accordingly upon such issues and proposed issues there appears in the record evidence to the following effect: The promissory note was made payable at Minneapolis; it was delivered to the plaintiff at Minneapolis.
Mrs Nelson gave testimony as follows: The defendants (makers of the note) are husband and wife. She is the mother of defendant A. L. Nelson. She has had all the transactions with the plaintiff concerning this note and the property. The plaintiff never saw the defendants. There was a farm in Polk county that stood in the name of the son. She made the arrangements to trade this land for the Minneapoils property, which was transferred by the plaintiff and the title placed in her son's name. The note in suit was given as a part of the purchase price. At the time of the original transaction, it was agreed between her and plaintiff that her son and daughter-in-law should not be held personally liable upon the note; that the plaintiff would rely solely upon the real estate security. In making this transaction she expressly told the plaintiff that she did not want her son and his wife to be held personally liable on the note, and the plaintiff made her understand that he would depend upon the lien. Later she made a deal with Rev. Scharf to trade her equity in the Minneapolis property for some land in St. Louis county. The Reverend wanted the money owing Leach to be paid. She went to the plaintiff and explained about her deal with the Reverend. She told him that she did not want her son and his wife to be held liable for any part of this debt. He stated that they would not be held liable; that he was perfectly satisfied with the mortgage; that the property was worth $ 8,000 or $ 9,000, and he was perfectly satisfied to take the lien upon the property. She then gave the Reverend a note for $ 400 and one for $ 600. She has paid the $ 400 note, but not the other. She told him that the Reverend was taking over the property subject to the mortgages. She gave these notes to the Reverend instead of paying off this $ 1,000 mortgage, and the Reverend agreed to pay such $ 1,000 mortgage. That, furthermore, she owed one Rogers $ 2,000. He wanted a second mortgage on this Minneapolis property. He and Mrs. Nelson saw plaintiff. In their presence, plaintiff again stated that he would not hold her son and daughter-in-law personally liable. She further testified that she was not aware of the foreclosure upon the property until she was advised by Rogers after sheriff's deed was issued. Mr. Rogers testified: That in his presence the plaintiff stated to, and promised, Mrs. Nelson that he would not hold her son or his wife personally liable upon the note. That he took a mortgage...
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