Riverside Iron Works v. Hall

• Decision Date: 13 January 1887
• Citation: 64 Mich. 165,31 N.W. 152
• Court: Michigan Supreme Court
• Parties: RIVERSIDE IRON-WORKS v. HALL.

31 N.W. 152

64 Mich. 165

RIVERSIDE IRON-WORKS v. HALL.

Supreme Court of Michigan

January 13, 1887

Error to Muskegon.

Keating & Dickerman, for plaintiff.

Smith Nims, Hoyt & Erwin, for defendant and appellant.

SHERWOOD J.

The plaintiff in this case is a corporation, located at Wheeling West Virginia. In 1883 a corporation, located at Crystal Falls, in this state, known as the Great Western Iron-mining Company, was engaged in mining iron ore in the vicinity of that place. The defendant was president of the company, and the plaintiff had an agent at the same time located at Chicago, whose name was Frederick K. Bowes. The plaintiff's business was the manufacture of iron and nails. In 1883 the defendant bargained with the agent of the plaintiff at Chicago to ship to the Great Western Iron Company, at Crystal Falls, a car-load of "T" rails and splice-bars and bolts, and, in accordance with the agreement, the iron was forwarded by the plaintiff to the Great Western Iron Company, and on its arrival at Crystal Falls, the defendant gave his individual acceptance for the iron purchased amounting to $853.87, due in four months, at 8 per cent.; on the receipt of which, the plaintiff wrote the defendant as follows: "We acknowledge the receipt of your valued favor of the 26th inst., covering acceptance for eight hundred and fifty-three and 87-100 dollars, in settlement of account as stated."

Defendant's acceptance was not paid at maturity. About the first of August thereafter, another agent of the plaintiff called upon the defendant for the purpose of collecting, or making some disposition of, the draft, and, in the negotiation of the matter, the agent, whose name was Timothy S. Casey, acting for the plaintiff, surrendered up the draft accepted by the defendant, and therefor received a draft on the Great Western Iron Company, accepted by the company, due in 60 days, for the amount of the overdue drafts, less $30, which was paid in money. The record does not show whether this acceptance of the Great Western Iron Company was ever presented for payment or not. It was not, however, when due paid; and in 1884 the plaintiff brought this suit against the defendant, declaring upon the common counts, accompanied by a bill of particulars containing as items the car-load of iron.

On the trial, the plaintiff claimed that when its agent, Casey, received the Great Western Iron-mining Company's acceptance, it was upon representations that the Great Western Iron-mining Company was solvent, and that its acceptance would be paid when due; and that neither of these things were true; and that, by reason thereof, the defendant continued to be liable for the value of the iron purchased. Upon the trial of the cause, the jury found a verdict for the plaintiff for the amount of its claim.

The defendant asks for a review in this court, and claims, first, that the plaintiff's evidence, undisputed, failed to make a case for it, and that the verdict should have been directed by the court accordingly. This position of course disposes of the whole case, if found to be correct.

It is quite clear that, when the iron was purchased, it was for the use of the Great Western Iron Company; also that the defendant gave his own individual acceptance therefor, due in four months, and received credit for the same on the books of the Great Western Company. When the draft became due the defendant gave the acceptance of the company, for what was before his individual paper, due in 60 days, and was then charged with the amount of the company's acceptance upon the company's books. When the defendant gave the plaintiff's agent the Great Western Company's acceptance for his own liability, it does not appear that he was asked to accompany the same with his individual liability in any way, or that he promised it to the plaintiff in any form. If the plaintiff expected that liability to continue for 60 days longer, the ordinary way of securing it would clearly have required the draft to have been drawn in such manner that he would have indorsed it. This was not done, and it has a bearing upon the question in what manner and for what purpose the acceptance of the company was received,--whether as payment or as security. This circumstance, taken in connection with the fact that the defendant's individual acceptance was regarded by the plaintiff as a settlement of the account for the iron purchased, and which was delivered up unconditionally to the defendant, is, I think, clearly sufficient prima facie to show that the acceptance of the company was received by the plaintiff as payment. A bill or note should be regarded as payment, whenever it appears such was the intention of the parties; and "that such was the understanding of the parties may be proved by circumstances, such as the acts and conduct of the parties, as well as by direct proof of an express promise or agreement." 2 Pars.Cont. 624; Hotchin v. Secor, 8 Mich. 494; Sage v. Walker, 12 Mich. 425; Brown v. Dunckel, 46 Mich. 32; S.C. 8 N.W. 537; Burton v. Wells, 30 Miss. 688; Patten v. Hood, 40 Me. 457.

The surrender of the evidence of the debt or liability strongly indicates payment, as whatever is received therefor is to be regarded as payment. Witherby v. Mann, 11 Johns 518; Johnson v. Weed, 9 Johns. 310; Gardner v. Gorham, 1 Doug. (Mich.) 509; Sears v. Smith...