Rintoul v. White

• Decision Date: 17 January 1888
• Citation: 108 N.Y. 222,15 N.E. 318
• Parties: RINTOUL v. WHITE.
• Court: New York Court of Appeals Court of Appeals

108 N.Y. 222

15 N.E. 318

RINTOUL

v.WHITE.^*

Court of Appeals of New York.

January 17, 1888.

Appeal from general term, superior court, city of New York.

James White brought this action against James Rintoul, to recover the amount of two notes made by the firm of Wheatcroft & Rintoul, of which firm defendant was not a member, on an alleged promise of defendant to pay the same, made after the making of the notes, on August 16, 1880. The notes were made, one June 1, 1880, at three months, due September 4, 1880; and the other, July 1, 1880, also at three months, due October 4, 1880. The consideration alleged in the complaint is forbearance to the original promisor ‘before July 1, 1881.’ Judgment for plaintiff, and defendant's motion for a new trial overruled. Defendant appeals.

Albert Stickney, for appellant.

Arthur R. Robertson, for respondent.

FINCH, J.

The doctrine prevailing in this state, which serves to distinguish between original and collateral promises in cases arising under the statute of frauds, has been reached in three stages. Each was a definite and deliberate advance towards a more faithful observance of the statute, and an abandonment of efforts to narrow the just and natural range of its application. When, by some authorities, it was said that a verbal promise to pay the debt of another was always collateral and invalid if the primary debt continued to exist concurrently with the promise, a simple and easy test was furnished to determine whether the statute did or did not apply. But when that test was discarded, and it became the law that a promise to pay another's debt might be original, although that debt subsisted, and was in no manner extinguished, the presence of such continued liability raised a cloud of doubt and ambiguity which, perhaps, will never be entirely dissipated. The argument in the present case has so reached back to the foundations of the controversy, and challenged or construed what has been said and ruled, as to make both useful and necessary a study of the path which the courts of this state have followed.

The plaintiff has recovered upon a verbal promise to pay the debt of another, and seeks to maintain his position in part upon the definition of an original promise framed in the old and familiar case of Leonard v. Vredenburgh, 8 Johns. 29. That definition assumed, as the test of an original promise, that it was founded on a new or further consideration of benefit or harm moving between the promisor and promisee. There was found in this some inaccuracy of expression, for, since every promise must have some consideration, to be valid at common law, and that necessary and inevitable consideration, wherever the debt to be paid antecedently existed, is always ‘new’ and ‘further,’ because different from that of the primary debt, and since, also, such new consideration does frequently move between the newly-contracting parties, giving benefit to promisor or harm to promisee, it became apparent that the terms of the definition were dangerously broad, and capable of a grave misapprehension, making it almost possible to say that a promise good at common law between the new parties was good, also, in spite of the statute. This difficulty was disclosed and measured, and then remedied, in Mallory v. Gillett, 21 N. Y. 412, by a divided court, it is true, but upon a prevailing opinion so strong in its reasoning, and so clear in its analysis, as to have commanded very general approval. The case was one where, in reliance on the promise made, the promisee had released to his debtor a lien which gave his debt protection. Within the language of the rule in Leonard v. Vredenburgh, the promise was original, and not within the statute, since the consideration which supported it was ‘new’ and ‘further,’ and passed between the newly-contracting parties, and consisted in the harm to the promisee involved in the surrender of his lien. But the promise was nevertheless held to be collateral, and the earlier definition modified so as to require that the new consideration should move to the promisor, and be beneficial to him. This change shut out at once from the class of original promises all those in which the consideration of the promise was harm to the promisee, and the resultant benefit moved to the debtor, instead of the promisor. The ground of the doctrine thus asserted was explained by the test then prevailing in Massachusetts, declaring the promise original where its leading and chief object is to subserve or promote some interest or purpose of the promisor himself, and upon which the respondent very much relies. Nelson v. Boynton, 3 Metc. 396. That this expression was understood to mean not merely some moral or sentimental object, but to relate to a legal interest or purpose tangible by the law, and a product of the consideration received from creditor or debtor, is apparent from the further current of the explanation. The learned judge contrasts a case in which the consideration benefits the debtor, but in it the promisor has no personal interest or concern, with one in which the consideration is the product of some new dealing between creditor or debtor and promisor, and in which the latter has a personal interest. That is what he means by a consideration of benefit moving to the promisor, and to obtain which is the object of the promise.

But the rule thus stated and explained was again narrowed and restricted. In Brown v. Weber, 38 N. Y. 187, it was asserted that a promise might still be collateral even though the new consideration moved to the promisor, and was beneficial to him. It was distinctly said that the existence of those facts would not, in every case, stamp the promise as original, but the inquiry would remain whether such promise was independent of the original debt or contingent upon it. The court added: ‘The test to be applied to every case is whether the party sought to be charged is the principal debtor, primarily liable, or whether he is only liable in case of the default of another third person; in other words, whether he is the debtor, or whether his relation to the creditor is that of surety for the performance by some other person of the obligation of the latter to the creditor.’ If this statement was not needed for a determination of the case, or the generality of its language left it debatable what precise limitation or qualification was intended to be added to the rule of Mallory v. Gillett, both difficulties were removed by the recent case of Ackley v. Parmenter, 98 N. Y. 425, in which RAPALLO, J., states with precision and accuracy the doctrine of the court. The debt there was the debt of one Sullivan, and the verbal undertakings were held to be within the statute, unless the defendant, before making the promise, had so dealt as to make Sullivan's debt his own, or had incurred a duty to pay the amount owing from Sullivan to the plaintiff. It was added, relatively to one possible view of the facts, that the plaintiff's undertaking was to pay out of the proceeds of the stock, and his duty to pay would not arise until he had converted the stock into money. ‘Consequently,’ it was concluded, ‘at the time of the alleged promise, he was under no present duty to pay, and the promise, though founded on a good consideration, (viz., the adjournment of the sale,) was nevertheless an undertaking to pay the debt of another.’

These four cases, advancing by three distinct stages in a common direction, have ended in establishing a doctrine in the courts of this state which may be stated with approximate accuracy thus: That where the primary debt subsists, and was antecedently...