Willis v. Sponsler
| Decision Date | 15 May 1928 |
| Docket Number | 25593 |
| Citation | 219 N.W. 581,117 Neb. 1 |
| Parties | RUSSELL C. WILLIS, APPELLANT, v. WINFIELD SPONSLER ET AL., APPELLEES |
| Court | Nebraska Supreme Court |
APPEAL from the district court for Kearney county: LEWIS H BLACKLEDGE, JUDGE. Affirmed.
AFFIRMED.
C. P Anderbery, for appellant.
Charles A. Chappell and Harvey M. Wilson, contra.
Heard before GOSS, C. J., ROSE, GOOD, THOMPSON, EBERLY and HOWELL JJ., and REDICK, District Judge.
This is a suit in equity to foreclose a mortgage for $ 1,925.33 on a hotel and two lots of ground in Wilcox, Kearney county. The mortgage and the note that it purported to secure were dated March 16, 1922, and were payable September 15, 1922. Russell C. Willis, payee and mortgagee, is plaintiff. Winfield Sponsler and Mattie Sponsler, husband and wife, makers and mortgagors, are defendants.
In an answer to the petition defendants admitted the signing of the note and the mortgage, but alleged that the real estate in controversy was their homestead, that the mortgage was never delivered, and that it and the note were given without consideration as an accommodation to plaintiff.
Upon a trial of the issues raised by the pleadings the district court canceled the mortgage and dismissed the action. Plaintiff appealed.
It is argued by plaintiff that an unpaid debt evidenced by two prior notes aggregating with interest the amount of the note in suit was a valid consideration for the latter. The prior notes were executed by defendants in favor of plaintiff under the following circumstances: Winfield Sponsler purchased from plaintiff March 30, 1920, a half section of land in Wichita county, Kansas, for $ 6,720. Later, to secure part of the unpaid purchase price, defendants executed a mortgage for $ 3,200 on the Kansas land. In addition they gave a secured interest coupon note for $ 192 and also an unsecured not for $ 1,600 on the purchase price, both dated March 1, 1921, and payable March 1, 1922. For an amount equal to the sum of these notes and interest, or $ 1,925.33, defendants, March 16, 1922, signed a third note and also a mortgage on the hotel property in Wilcox, Nebraska. This third note and the mortgage purporting to secure it, while unrecorded, were left in the First National Bank of Wilcox, Nebraska, in care of William Halstead, cashier, where they remained more than three years. Plaintiff eventually procured possession of them, had the mortgage recorded June 6, 1925, and brought this suit June 12, 1925, to foreclose the mortgage.
On the issue of consideration for the third note plaintiff testified in substance that none of the notes were paid; that the note in suit was given for the 192-dollar note and the 1,600-dollar note plus interest; that the latter note was given for Kansas land, was merged in the note for $ 1,925.33, and was given to take up the other notes, including principal and interest. Plaintiff still held the original notes at the time of the trial and introduced them in evidence as a part of his case in chief. The debt evidenced by one of the original notes retained by him was a lien on the Kansas land. While holding onto the prior notes and the lien on the Kansas land he brought suit in Nebraska on the new note. He did not testify that the new or third note was a renewal or that it was given to extend the time for payment of the old or original notes or that it and the mortgage on the Nebraska real estate were given as additional or collateral security. There was no evidence of an agreement that the new note discharged the original indebtedness. The following is a well established rule of law:
The making and the accepting of a new promissory note for an existing one is not a payment of the maker's original indebtedness, unless there is a specific agreement to that effect. Spear v. Olson, 104 Neb. 139, 175 N.W. 1012; Auld v. Walker, 107 Neb. 676, 186 Neb. 1008; Berwyn State Bank v. Swanson, 111 Neb. 141, 196 N.W. 125; Nebraska State Bank v. Walker, 111 Neb. 203, 196 N.W. 128; Farmers' State Bank v. Dowler, 112 Neb. 262, 199 N.W. 528; Exchange Nat. Bank v. Schultz, 113 Neb. 346, 203 N.W. 496; City Nat. Bank v. Denslow, 114 Neb. 600, 209 N.W. 254.
There is no direct proof that defendants as makers of the old notes are not liable thereon to plaintiff. The only parties to this litigation are the makers and the payee. No innocent purchaser is interested in the controversy.
With plaintiff's case as thus outlined it was defended in part under the following theory of the law:
"An accommodation maker of a promissory note is not liable to the party accommodated." Empson v. Richter, 113 Neb. 706, 204 N.W. 518; Farmers Nat. Bank v. Ohman 112 Neb. 491, 199 N.W. 802; Spangenberg v. Losey, 116 Neb. 112, ...
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