Southard v. Ark. Valley & W. Ry. Co.

• Decision Date: 13 July 1909
• Docket Number: Case Number: 2112 OK Ter
• Citation: 1909 OK 197,103 P. 750,24 Okla. 408
• Parties: SOUTHARD v. ARKANSAS VALLEY & W. RY. CO.
• Court: Oklahoma Supreme Court

1909 OK 197

103 P. 750

24 Okla. 408

SOUTHARD v. ARKANSAS VALLEY & W. RY. CO.

Case Number: 2112 OK Ter

Supreme Court of Oklahoma

Decided: July 13, 1909

Syllabus

¶0 1. EVIDENCE--Parol Evidence--Railroad Bonus Note--Consideration. An instrument reciting: "For value received and for benefits accruing to me from the construction of a railroad from some point on the St. L. & S. F. Railroad between S. and T., through the city of P., to connect with the B., E. & S. Railway, * * * I * * * agree to pay to the order of A. V. & W. Railway Company, at the Exchange Bank of P., the sum of two hundred and fifty and no-100 dollars, * * * to become due and payable when said railroad shall be constructed to and into P."--is a contract between the parties.

(a) No contemporaneous parol condition or consideration may be ingrafted into such contract, so as to add to, vary, or contradict the same, except upon proper allegations of fraud, accident, or mistake.

2. BILLS AND NOTES--Validity--False Representations. When, in the answer, the defense is averred that, prior to the execution of the note or contract, the representatives of the make, a corporation proposing to construct such railway line, represented, in soliciting or procuring such notes or contracts, which statements were unfounded, that unless the same were entered into the line would be diverted from said city, to the great disadvantage of the property owners of the city, the testimony of the maker of the contracts here in question showing that such representations were not the moving cause of his entering into the contract, held, that such testimony eliminated this question from the case

3. BILLS AND NOTES--Legality of Consideration--Railroad Bonus Note. A promissory note or obligation, payable to a railroad company in aid of the construction of its line between two given points through a certain point, is not void as against public policy--following Guss v Federal Trust Company, 19 Okla. 138, 91 P. 1046; Guthrie & W. Ry. Co. v. Rhodes, 19 Okla. 21, 91 P. 1119; Cooper v. Ft. S. & W Ry. Co. 23 Okla. 139, 99 P. 795; Cobb v. Wm. Kenefick Construction Co., 23 Okla. 449, 100 P. 551.

S. H. Harris and H. B. Martin, for plaintiff in error.

James B. Diggs and Russell G. Lowe, for defendant in error, citing: Okla. St. 1893, § 822; Jones, Law of Evidence (2d Ed.) §§ 459, 468; Wigmore, Law of Evidence, § 2433; Hubbard v. Marshall, 50 Wis. 327; Engelhorn v. Reitlinger, 122 N.Y. 76; Fawkner v. Paper Co., 88 Iowa, 169; Sandage v. Mfg. Co., 142 Ind. 148; Railway Co. v. Rhodes, 19 Okla. 21; Greenhood on Public Policy, pp. 321, 323; Wood on Railways, § 184; Piper v. Townsite Co., 16 Okla. 436; Farrington v. Stuckey (Ind. T.) 104 S.W. 647; Railway Co. v. City of Marshall, 136 U.S. 393; Railway Co. v. Robards, 60 Tex. 545; Railway Co. v. Hopkins, 18 Kan. 494; Chamberlain v. Ry. Co., 15 Ohio St. 225; Bank v. Hendrie, 49 Iowa, 402.

Error from District Court, Noble County.

Action by the Arkansas Valley & Western Railway Company against R. W. Southard. Judgment for plaintiff, and defendant brings error. Affirmed.

S. H. Harris and H. B. Martin, for plaintiff in error.

James B. Diggs and Russell G. Lowe, for defendant in error

WILLIAMS, J.

¶1 The following questions are raised in the brief by the counsel for the plaintiff in error:

(1) That under a plea of failure of consideration parol evidence is admissible to prove the failure of consideration, although the consideration so shown may be different from or additional to that expressed in the instrument.

(2) When a written instrument states a consideration in general terms, it is competent to show by parol the particulars included in the general consideration, in order to show that there had been a failure in the consideration and the extent of it.

(3) When the route of a proposed railroad is fixed by the charter, and the officers of said railroad company represent to citizens of a community upon the line of such railroad that unless a sum of money is paid the railroad company it will build its road elsewhere, to the injury of such community, and a contract is induced by such means to pay said railroad company a sum of money, such contract rests upon a fraudulent consideration and is void.

(4) When a railroad company, proposing to build a railroad through a community, induces the owner of property at a point on its line to agree to pay the railroad a sum of money by promising to locate its depot or station at a given point, to the advantage of such person, and a contract is procured thereby, and the railroad company afterwards fails to locate its depot as agreed, that the consideration fails, and the contract cannot be enforced at the suit of the railroad company.

(5) A railroad corporation, exercising the power of eminent domain, is a quasi public corporation, and in locating its line of railroad and facilities its paramount duty is to the public; and any contract entered into with such railroad company, its officers or agents, to influence the location of its line or facilities, is contrary to public policy and void.

¶2 The first, second, and fourth questions will be considered together under subdivision 1.

1. The body of the contract upon which this action is based recites:

"For value received and for benefits accruing to me from the construction of a railroad from some point on the St. Louis & San Francisco Railroad between Sapulpa and Tulsa, I. T., through the city of Perry, in Noble county, to connect with the Blackwell, Enid & Southwestern Railway, I., the undersigned, agree to pay to the order of the Arkansas Valley & Western Railway Company, at the Exchange Bank of Perry, Oklahoma, the sum of two hundred and fifty dollars and no/100, the said amount to become due and payable when said railroad shall be constructed to and into the city of Perry, Oklahoma. It is also provided that, if said road is not constructed before January 1, 1904, this obligation shall be void."

¶3 It is insisted by counsel for the plaintiff in error that it is permissible, without proper allegations of fraud, accident, or mistake in its execution, to ingraft onto this contract the additional condition or consideration that the depot of said railroad company at the station of Perry should be located at a given point, and the question arises as to whether or not such testimony is permissible. The following authorities are cited by plaintiff in error to sustain his contention; but, as will hereinafter appear, none, except, possibly one, are applicable to the case at bar:

¶4 The case of Northwestern Creamery Company of Sacred Heart v. Lanning, 83 Minn. 19, 85 N.W. 823, involves an action on a promissory note which recites: "I promise to pay to the Northwestern Creamery Company of Sacred Heart the sum of twenty dollars." It was held in that case that parol testimony was admissible to show the actual consideration, or want or failure of consideration. In the case at bar the contracted consideration is set out, and the foregoing case is therefore not in point.

¶5 In the case of Reese v. Strickland, 96 Ga. 784, 22 S.E. 323, the lower court charged the jury that:

"Written evidence is of higher character than oral. Where the parties have reduced their contract or cause of action to writing such writing is the best evidence of said contract or cause of action, and any agreement made before or at the execution of the contract, such agreement or conversation is merged therein, and parol evidence cannot be introduced to vary, add to, or take from the terms of said contract. In other words, parol evidence cannot be introducted to attack it in any way, unless said writing is overthrown by proof of fraud, accident, or mistake."

¶6 The Supreme Court of Georgia held that:

"Although, where 'a contract or cause of action' has been reduced to writing, its terms cannot be varied by parol contemporaneous evidence, yet where suit is brought thereon, and the defense in part was failure of consideration, and there was some evidence to support the same, it was error for the court to charge that 'parol evidence cannot be introduced to attack it [the contract or cause of action] in any way, unless said writing is first overthrown by proof of fraud, accident, or mistake.' To vary the terms of the contract, and to attack the plaintiff's cause of action thereon by pleading and proving failure of consideration, are altogether different things."

¶7 In the case at bar there was no proof offered by the plaintiff in error tending to show that there had not been constructed a railroad between the points named, through the city of Perry, before January 1, 1904.

¶8 As to Gage v. Lewis, 68 Ill. 604, that rested upon a statute of that state, and could have no application here.

¶9 As to Wood v. Young, 5 Wend. (N. Y.) 633, that related to mutual releases given in extinguishment of prior transactions; and it is a universal rule that the consideration may be inquired into, where there is a mistake, accident, or fraud. But in that case the releases and settlement were not permitted to be superseded or set aside on the ground that the evidence was not sufficient to show a mistake.

¶10 In the case of Goward et al. v. Waters, 98 Mass. 596, the court said:

"Proof of the facts which make out such considerations does not contradict, add to, nor vary the written contract, but tends to support it according to its legitimate and proper interpretation. The allowance of such proof seems to be in accord with the decisions in Wallis v. Wallis, 4 Mass. 135, 3 Am. Dec. 210; Gale v. Coburn, 18 Pick. (Mass.) 397; Brewer v. Hardy, 22 Pick. (Mass.) 376, 33 Am. Dec. 747; Bullard v. Briggs, 7 Pick. (Mass.) 533, 19 Am. Dec. 292; Hinde's Lessee v. Longworth, 11 Wheat. 199, 6 L. Ed. 454; Powell v. Monson & Brimfield Manufacturing Co., 3 Mason, 347 359; F. Cas. No. 11,357; McCrea v. Purmort, 16 Wend. (N. Y.) 471, 30 Am. Dec. 103; Belden v. Seymour, 8 Conn. 304, 21 Am. Dec. 661; Morse v. Shattuck, 4 N.H. 229, 17 Am. Dec. 419; 2

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