Tronson v. Colby University

• Decision Date: 09 November 1900
• Docket Number: 6731
• Citation: Tronson v. Colby University, 84 N. W. 474, 9 N.D. 559 (N.D. 1900)
• Court: North Dakota Supreme Court

84 N.W. 474

9 N.D. 559

C. TRONSON v. COLBY UNIVERSITY

No. 6731

Supreme Court of North Dakota

November 9, 1900

Appeal from District Court, Traill County; Pollock, J.

Action by C. Tronson against the president and trustees of Colby University. Judgment for plaintiff. Defendant appeals.

Reversed.

Judgment entered dismissing the action. Reversed.

Tracy R. Bangs, for appellant.

The note in suit is drawn with a stipulation for the payment of current rate of exchange in New York City in gold, or its equivalent, its negotiability is thereby destroyed. Flagg v. School District, 4 N.D. 30. In every other respect it is a perfect and valid promissory note. Hastings v Thompson, 54 Minn. 182, 55 N.W. 968, 21 L. R. A. 178; Whittle v. Bank, 26 S.W. 1106. The note was given to McLaughlin in consideration of the $ 170 in money and the latter's agrement to use the balance of the loan in paying off and securing the discharge of certain indebtedness due from Tronson to third parties. In this transaction there was a good, valuable and sufficient consideration for the $ 1,000 note. Consideration in bills and notes is some right interest, profit or benefit accruing to the one party, or some forbearance, loss, or in other words, detriment suffered by the other. Bigelow on Bills & Notes, 213; Currie v Nind, Law Rep. 10 Exch. 162. It is always sufficient to hold the note if the maker thereof got what he contracted for whether that consideration be commensurate to the amount of money stated in the note, as measured by the ordinary theories of value, being entirely immaterial. Wolford v. Powers, 85 Ind. 294, 44 Am. Rep. 16; Earl v. Peck, 64 N.Y. 596; Amherst Academy v. Cowls, 23 Mass. 427, 17 Am. Dec. 387. The true consideration for the note and mortgage now in controversy was the money in hand paid by McLaughlin to Tronson, and McLaughlin's contract to become respondent's agent and pay off certain of respondent's debts. This was sufficient consideration to support the note and mortgage. Chapman v. Eddy, 13 Vt. 205; Earle v. Angell, 32 N.E. 164; Trask v. Vinson, 20 Pick. 105; Hubon v. Park, 116 Mass. 541; Turner v. Rogers, 121 Mass. 12; Hodgkins v. Moulton, 100 Mass. 309; Gutlon v. Marcus, 43 N.E. 125; Wells v. Sutton, 85 Ind. 70; Thompson v. Thompson, 43 Ky. 502; Lindell v. Rokes, 60 Mo. 249, 21 Am. Rep. 395; Hamer v. Sidway, 21 Am. St. Rep. 693; Wright v. Wright, 54 N.Y. 437; Gould v. Banks, 24 Am. Dec. 90; Overton v. Curd, 8 Mo. 420; Babcock v. Wilson, 25 Am. Dec. 263; Davis v. Calloway, 95 Am. Dec. 671; Howe v. O'Mally, 3 Am. Dec. 693; Sharon v. Sharon, 8 P. 614; VanEpps v. Redfield, 68 Conn. 39, 34 L. R. A. 360; Provenshee v. Piper, 36 A. 552; Pullman v. Booth, 28 S.W. 719; Gum Co. v. Braendly, 51 N.Y.S. 93; Daniels on Neg. Inst. § 187; Randolph, Com. Paper, § § 479-481. Respondent is not entitled to the relief prayed for, viz: the cancellation of the note and mortgage, because he has shown no mistake; he got all he contracted for. He has shown no fraud or accident. The note is non-negotiable, was past due when respondent commenced this action. No ground for the exercise of equity jurisdiction for the cancellation of a written instrument is alleged or proven. Lewis v. Tobias, 10 Cal. 575; Field v. Holbrook, 14 How. Prac. 108; Hamilton v. Cummings, 1 Johns. Chan. 517; Pom. Eq. Jur. § 1377. There must be a controlling reason for coming into equity. Boyd v. Boyd, 33 N.E. 568. Relief is never given as against an innocent purchaser. Pom. Eq. Jur. § § 776, 871 and 918. Tronson made his note and mortgage to McLaughlin for a good and complete consideration. He thus put it in McLaughlin's power to transfer the securities. The instruments were valid in their inception and valid when taken by the Colby University. They are still valid and cannot be delivered up and cancelled without working an injustice to the present holder. 18 Enc. Pl. & Prac. 750, note 2; Brown v. Boyd, 158 Mass. 470, 33 N.E. 568; Dixon v. Wilmington Trust Co., 20 S.E. 464; Mayes v. Robinson, 5 S.W. 611. There was no time specified for the performance of the promise of McLaughlin to secure releases of the prior incumbrances. Plaintiff must therefore allege and prove a demand and refusal to perform, or that McLaughlin is insolvent and unable to perform. Worley v. Mourning, 4 Ky. 254; Hamble v. Tower, 14 Ia. 530; Morey v. Enke, 5 Minn. 392; Adkins v. Farrell, 42 S.W. 1145; Mount Joy v. Mullikin, 16 Ind. 226; Gray v. Greene, 9 Hun. 334; Parker v. Parker, 9 South. Rep. 426; Tom v. Wollhoefer, 61 Tex. 277; Charpaux v. Bellocq, 31 La.Ann. 164; Duggar v. Dempsey, 43 P. 357; Axtel v. Chase, 77 Ind. 74; Maness v. Henry, 11 South. Rep. 410

J. A. Sorley, for respondent.

Tronson executed to McLaughlin his note secured by mortgage, in consideration whereof McLaughlin agreed to take up and satisfy of record a mortgage amounting to $ 616, and judgments amounting to $ 201, which he failed to do. Was the agreement dependent or independent? It will be construed as dependent unless a contrary intention appears from the terms of the contract itself. Davis v. Jefferies, 58 N.W. 815; Lester v. Jewett, 11 N.Y. 453; Kane v. Hood, 13 Pick. 281; Swan v. Drury, 22 Pick. 485; Williams v. Healey, 3 Denio, 363; Grant v. Johnson, 5 N.Y. 247; Parker v. Parmele, 20 Johnson, 130; Galvin v. Prentice, 45 N.Y. 162; Dunham v. Pettee, 8 N.Y. 508; Smith v. Lewis, 26 Conn. 110; Clark v. Weis, 87 Ill. 438; Wagon Co. v. Crocker, 4 F. 578; Perry v. Connell, 31 S.W. 685. If the note in question had been made payable at a time so soon after its execution that McLaughlin could not with reasonable diligence have secured satisfaction of mortgage and judgments, then a recovery could be had in an action commenced when the note fell due without showing a compliance with his part of the agreement, but if he delayed bringing the suit until a time when satisfactions should have been secured then a compliance with his agreement must be shown before a recovery can be had. First Nat. Bank of Madison v. Spear, 80 N.W. 166; Bank v. Hagner, 1 Peters, 455; Loud v. Water Co., 153 U.S. 564; Hogan v. Kyle, 35 P. 399; Divine v. Divine, 58 Barb. 264; Underwood v. Tew, 34 P. 1100; Shelly v. Mikkelson, 63 N.W. 210, 5 N.D. 22. The validity of the defense of want of consideration was passed on in Flagg v. School District, 5 N.D. 191; Towle v. Greenberg, 6 N.D. 37, 68 N.W. 82. A partial failure of consideration is a good defense pro tanto. 4 Am. & Eng. Enc. L. (2d Ed.) 195. The facts set out in the complaint are sufficient to invoke the aid of a court of equity. 3 Pom. Eq. Jur. 1188, 1233; 1 Pom. Eq. Jur. 166, 170 and 171; Heywood v. City of Buffalo, 14 N.Y. 534; Ward v. Dewey, 16 N.Y. 519; Byne v. Vivian, 5 Ves. 604; Crooke v. Andrews, 40 N.Y. 547; Marsh v. City, 59 N.Y. 280; Lewis v. Tobias, 10 Cal. 575; Field v. Holbrook, 14 How. Prac. 108; Pierce v. Webb, 3 Barb. Ch. 16; Jackman v. Mitchell, 13 Ves. 581; Hayward v. Dimsdale, 17 Ves. 111; Petit v. Shepherd, 5 Paige, 498; 2 Story's Eq. Jur. 700; Ryerson v. Willis, 81 N.Y. 277; Fitzmaurice v. Mosier, 16 N.E. 175; Otis v. Gregory, 13 N.E. 39. A party to an instrument which is of no legal force or validity whatever may ask the aid of a court of equity in procuring its surrender and cancellation. Bishop v. Moorman, 98 Ind. 1; Scobey v. Walker, 15 N.E. 674; Brown v. Kranse, 23 N.E. 1012; Honnan v. Hartmentz, 27 N.E. 731. A court of equity will freely rescind a conveyance by parents to a son in consideration of his covenant to support them, in case of a breach of such covenant. Morgan v. Loomis, 48 N.W. 109; Blum v. Bush, 49 N.W. 142; Lampery v. Lampery, 12 N.W. 514; Mansfield v. Mansfield, 52 N.W. 290; Barker v. Smith, 52 N.W. 723. Such a court of equity will lend its aid to cancel a mortgage that is claimed to have been paid. Donaldson v. Wilson, 44 N.W. 429; Ingals v. Bond, 33 N.W. 404; Shilling v. Darmody, 52 S.W. 291; Rogers v. Day, 74 N.W. 190. By going to trial without raising the point, either by demurrer or answer, appellant cannot now for the first time be held to question respondent's right to the relief prayed. Black v. Miller, 50 N.E. 1009; Stout v. Cook, 41 Ill. 447; Ryan v. Duncan, 88 Ill. 144. An objection to the jurisdiction of the court that there is a perfect remedy at law cannot be made for the first time at the hearing, it should be taken by demurrer to the bill or by answer. 1 Enc. Pl. & Prac. 883; Clay v. Greenwood, 53 N.W. 659; Corey v. Sherman, 60 N.W. 232; Buck v. Young, 27 N.E. 1006; Mayes v. Goldsmith, 58 Ind. 94; Day v. Henry, 4 N.E. 44; Lauder v. Green, 46 N.W. 1108; Benjamin v. Vieth, 45 N.W. 731; Gould v. Hurto, 15 N.W. 588; First Nat. Bank v. Rowley, 61 N.W. 195; Bright v. Ecker, 68 N.W. 326; McVey v. Marratt, 45 N.W. 548; Dodge v. Davis, 52 N.W. 2; § 5272, Rev. Codes; Kolka v. Jones, 71 N.W. 558.

OPINION

BARTHOLOMEW, C. J.

This is an action in equity to cancel a certain note for $ 1,000 held by defendant against plaintiff, and to cancel and satisfy of record a mortgage upon real estate given to secure said note. Plaintiff was successful below. There is but one question in the case, and that is a question of law. The undisputed facts show that in January, 1889, the plaintiff borrowed from one S.W. McLaughlin the sum of $ 600, and gave McLaughlin his promissory note for said sum, due December 1, 1893, and bearing interest at the rate of 8 per cent. per annum before maturity, and 12 per cent. after maturity. To secure this note plaintiff executed and delivered to McLaughlin a mortgage upon certain land in Traill county, which was recorded January 24, 1889. Prior to March 30, 1893, judgments in favor of four different parties had been docketed against plaintiff in Traill county. These judgments amounted to about $ 1,200. A few days after the note and mortgage above mentioned were...