Case ID: monaghan_2/html/0403-01.html
Source: Caselaw Access Project
Author: {"author": "Per Curiam,", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Rhine’s Appeal. [Swartley Bros. v. Rhine.]
    On a rule to open a judgment entered on a note for $4,000, the defendant averred in her petition and testified in her deposition that the note was falsely represented to her to be a note for $400. This averment was supported by her own oath alone. The testimony of the plaintiff and another witness flatly contradicted the defendant’s testimony. The court discharged the rule. Held., to be no cause for reversal of the judgment.
    This proceeding is the equivalent of a bill in equity to reform a note for fraud in its creation. In such case, a chancellor will not interfere upon the unsupported oath of the petitioner : Per Curiam.
    Jan. 25, 1888.
    Appeal, No. 110, July T., 1888, from C. P. Montgomery Co., to review a decree discharging a rule to open a judgment, Swartley Brothers against Salome Rhine, at March T., 1887, No. 100. Williams and McCollum, JJ., absent.
    The defendant, in her petition for a rule to open the judgment, averred :
    “ That your petitioner is a widow, residing at Abington station, in Montgomery county, Pennsylvania, and is the owner of real estate in this county.
    “ That she cannot read writing, that she is very deaf, and can only understand what is said to her by speaking in a very loud tone of voice and very distinctly.
    “ That, in the month of February or March 1878, one George Smith, with whom she had been having dealings for years, purchasing from him goods, etc., weekly and sometimes daily, and who is a neighbor of hers, called at her house and asked her whether she would not become his security for a small sum in favor of Swartley Bros. That it would not be much, and that the matter would soon be satisfactorily arranged. That, after considerable urging on the part of the said Smith, she consented to become his surety to the extent of $400. That the said Smith well knew from previous transactions her unwillingness to become surety for any body, or to sign any papers without first having submitted the same to her daughters, or to her counsel. That the said Smith, when he asked her to become his surety, exacted from her the promise that she would not tell her daughters or any person about this matter, and said that he would return in a.few minutes with Mr. Swartley. Mr. Smith and Mr. Swartley, one of the plaintiffs, returned to her house within a half hour after the above conversation, and after going into the parlor of her residence at Abington, presented to her a paper which she was unable to read, and which they said to her was security for Mr. Smith in favor of the Swartleys for the sum of $400. That your petitioner looked at the said paper, but was unable to read it, and, after being assured by these gentlemen that it was all right, she put her name to it, supposing that it was simply a security for Mr. Smith for the sum of $400. That these gentlemen then and there so told her.
    “ Your petitioner further alleges that the said Smith knew that your petitioner was unable to read writing, and that she was unable, without information from some one else, to say whether the paper handed her was for $400 or $4,000.
    “Your petitioner further states that she has never had the advantages of an education, and that she is unable to tell how many ciphers are necessary to make $4,000. That as she was constantly purchasing goods of the said Smith and frequently owed him the sum of $300 or $400, and is now indebted to him in the sum of $300 or upwards, she did not feel at all uneasy about this matter, as she felt the money she owed Mr. Smith could be used at any time to pay off this security, and that she has repeatedly within the past few months requested Mr. Smith to call and have a settlement, as she was ready to pay him, and wished to get the security out of the way.
    “ Your petitioner further avers that she was not informed and did not know that this security was to be entered up as a lien against her property, and that if it had been so represented to her, she would not have signed it; and also that had she known that the said security was to be in a sum in excess of $400 she would not, under any circumstances, have signed the said paper. That she was wholly deceived and misled by the said Swartley and said Smith, and was not aware until the evening of-Friday, November 4th, when she was informed by M. L. Kohler, Esq., (through her counsel,) to whom she had made a sale of her property, that the said security had been entered up as a judgment against her property, and that the records of this county showed a lien of $4,000, and that the said security, which your petitioner thought was $400, now turns out to be a judgment against her for $4,000, and that the said judgment is entered up as a lien against her said property to the number and term as stated above.”
    The defendant reiterated the averments of the petition in her deposition in support of the rule.
    George W. Smith, in his deposition, affirmed on the part of the plaintiff, testified :
    “ I know Salome Rhine. Have been dealing with her since the spring of 1880. Mr. Swartley came to my place about the 25th of March, 1887, and we were fixing up the accounts, and found that they were considerable short of paying Swartleys all that was coming to them. I then asked him if I could get security, whether they would allow me to keep the teams another year to see what I could do, as Mr. Heist had made me a very good offer; and that I might be able to cut down what Mrs. Rhine would have to stand good for. Mrs. Rhine had, prior to that time, become my security to the Swartleys. In consequence of what was said, I went to see Mrs. Rhine, and asked her if she would go my security for four thousand dollars. She studied for perhaps a minute or more and said that she would; that I had done a good bit for her. I went back and told Mr. Swartley what she had said, and he went to her house the same day soon after that, and Mr. Swartley asked her if she was going to go my security for four thousand dollars. She said ‘ yes,’ and Mr. Swartley filled up the note and read it to her aloud, so that she heard it, and then laid it on the table and pushed it to her and told her to read it for herself. She signed the note and said she guessed it would be all right. I said yes, it would be all right, that she had been my security all the time for a good bit more than that, and that I would give her an insurancepolicy for $3,000 as collateral security if she wanted it; that they had about seven years from that time to run. I think her reply was that it didn’t make much difference about that, though I am not positive about it. I don’t think she accepted that offer. She didn’t refuse it, but she didn’t accept it. Mr. Swartley said she had better take that; that the policy and the horses they had let me have he thought would about straighten or clear everything up.”
    Harry R. Swartley, one of the plaintiffs, deposed: "
    “ Q. Did you call on George Smith on March 25, 1887, in reference to your accounts? A. I did; the same day I got that $4,000 note. Q. In consequence of the conversation and settlement you had with Mr. Smith, what did you do ? A. Well, we compared our accounts — compared our account with Smith’s account. There was owing us between $7,000 and $8,000; and we went and counted the amount on the books of outstanding bills, and found there wouldn’t be enough to pay to us the amount due; and I told him that he would have to see Mrs. Rhine, his security; that there would be at least a deficiency of $4,000; and he wanted to know how long a time we would give him, and I told him I was willing to take a judgment from Mrs. Rhine for $4,000 for one year. He went over to see Mrs. Rhine, and when he returned he said she was willing to go his security for $4,000. I went with him over to Mrs. Rhine, and I said to Mrs. Rhine that Mr. Smith was willing to transfer policies of insuránce, amounting to $3,000, as collateral security, and then I read the note to her, and told her it was the same kind of a note the $600 note was for. After I had read it out loud to her, standing on the right side of her, I gave her the note, and told her to read it for herself. She looked at the note, and she signed it.....A. I said, too, at the time that the book accounts collectible might probably amount to more than we thought, and I also said to her that she would only be unsecured for $1,000 if she got the policies, and if the amounts collectible on the books would amount to more than we had figured on, the value of the horses and wagons could be applied on the $ 1,000 balance she was not secured for, and which she was security for. That was all that was said at the time.”
    The rule was discharged, in the following opinion of the court below:
    “ It appears from the testimony that George W. Smith had been acting as agent for Swartley Bros., at Edge Hill, Montgomery county, and that Mrs. Rhine had become his surety for the faithful performance of his agreement with his principals. After a time a settlement was made between the parties, and Smith was found to be indebted to the plaintiffs in an amount exceeding seven thousand dollars, for part of which amount the plaintiffs demanded security. The defendant was then requested to give a judgment note, which she consented to do. A note for four thousand dollars was prepared and taken to her house by Swartley and Smith, and was signed and delivered by the defendant. Judgment was entered thereon in the prothonotary’s office. When Mrs. Rhine sold her real estate she was confronted with this lien. She now declares that Smith only asked her to become his security for four hundred dollars, and that she signed the note under that impression, and after being so told by both Smith and Swartley. Smith and Swartley, however, both positively deny this statement, and swear that they both told her that the note was for the amount as written in the note; that it was read to her and by her before signing. She stands alone, in her assertion, and is also met with the fact that she had already been security for a larger amount, and that this was for her benefit. Her counsel has ably argued her case and advanced many theories and propositions to sustain his position, but under all the facts before us we are compelled to refuse the motion. The numerous authorities upon questions of a kindred nature leave us no alternative. Whilst parol testimony is admissible to reform a written contract by varying or adding to its terms on the ground of fraud or mistake, yet unless there be such testimony as a chancellor could consider upon a question of this nature it ought not to be submitted to a jury in a proceeding at law. N. W. Branch Ry. v. Swank, 105 Pa. 555-
    “ The evidence requisite to reform a written instrument on the ground of fraud, accident, or mistake, must be clear, precise and indubitable. If the evidence when admitted is not such as would move a chancellor to reform the contract, the case should not be submitted to the jury without binding instructions as to its sufficiency. Sylvius v. Kosek, 20 W. N. C. 152.
    “ A judgment will not be opened where the testimony of the plaintiff and defendant counterbalance. Early’s Appeal, 90 Pa. 321; Zaring v. Early, 2 Pears. 352.
    “ The case at bar is not so strong as that of Knarr v. Elgren, 8 Cent, 828, where the defendant had signed a note for $500 believing it to be for $5. As the weight of the testimony here is in favor of plaintiffs, we must sustain the judgment.
    “ Although this was the only fact alleged in the petition upon which the rule was granted, the defendant has taken testimony to show that in other respects she should have relief. But we do not think that either position is sustained by the facts or the law. The representations as to the horses have done her no harm, nor were they any inducement to the signing of the note. Smith actually took them into his possession and still held them at the time the depositions were taken. If Swartley therefore induced her to believe that they would be available when necessary for her relief, she still has her remedy to enforce the agreement at the proper time, but until she is entitled to reinbursement the question does not arise,
    “ The policies of insurance have no weight in the case. If Smith deceived her, Swartley was not to blame, for he urged her to accept them, and she expressed herself as not desiring them. Nor can we see any force in the point that time was given Smith, whereby the security was released. This was done at the time when the new security was taken, and was part of the arrangement, as shown by the note itself, and, to this, Mrs. Rhine consented when she signed it. It was the very object of the whole proceeding, and, unlike the case where, after a surety is once fixed for the debt, he can claim release because his hands are stayed as against the principal by some act of the creditor. Under all the facts of the case we are compelled to refuse the rule.”
    
      The assignment of error specified the action of the court in refusing to open the judgment.
    
      Issac S. Sharp, for appellant.
    The whole drift of the conversation with Mrs. Rhine tended to show that she was safe in going the security, whereas she would be involved in a certain loss; that she had full counter-security, whereas she had noneatall. Under such circumstances, the surety is discharged. Lancaster Co. Bank v. Al-bright, 21 Pa. 228; Blest v. Brown, 8 Jur. N. S. 603; Railton v. Mathews, 10 Cl. Sc F. 935 ; Phillips v. Foxall, L. R. 7 Q. B. 666; Lee v. Jones, 17 C. B. N. S. 482; De Colyar, Suretyship, ed. 1885, 125.
    A contract of surety must be construed strictly. Com. v. West, 1 Rawle, 31; Lane’s Ap., 17 W. N. C. 367; Manf. Co. v. Lawrence, 1 Allen, 339; Leggett v. Humphries, 21 How. 66; McMicken v. Webb, 6 How. 393; Bank of Minneapolis v. Keen, 8 W. N. C. 283; Brez v. Warner, 9 W. N. C. 45 ; Com. v. Simonton, 1 Watts, 310; Building Ass’n v. Benson, 2 W. N. C. 541; Lyons v. Divelbis, 22 Pa. 185 ; Sanderson v. Ashton, L. R. 8 Ex. 73; Blest v. Brown, 8 Jur. N. S. 603; Phillips v. Austling, 2 Taunt. 206; Grant v. Smith, 46 N. Y. 93; Wilson v. Edwards, 6 Lans. x 34; Baylies, Suretyship, 268; Home v. Brunskill, 3 Q. B. D. 469; Whitecher v. Hall, 5 B. & C. 269.
    The agreement by Swartley to give time to Smith was not communicated to Mrs. Rhine. Giving time to the principal debtor will release the surety. Cross v. Marcey, 2 Luz. L. Reg. 85 ; Bangs v. Strong, 4 N. Y. 315; Grayson’s Appeal, 16 W. N. C. 388; Uhler v. Applegate, 26 Pa. 140; Clippenger v. Creps, 2 Watts, 45; Mfg. & M. Bank v. Bank of Pa., 7 W. & S. 335; Berks v. Ross, 3 Binn. 520; Miller v. Stem, 12 Pa. 383; Henderson v. Ardery, 36 Pa. 449; Boschertz;. Brown, 72 Pa. 372; Sawyers v. Hicks, 6 Watts, 76; Talmage v. Burlingame, 9 Pa. 21; Reiner v. Rodgers, 2 W. N. C. 16; De Colyar, pp. 369, 370, 371; Com. v. Vanderslice, 8 S. & R., 452; Baylies, Surety, 234 and notes.
    
      J P. Fíale Jenkins, for appellee.
    The refusal to open a judgment is within the sound discretion of the court below. Wernet’s Ap., 91 Pa. 319; Schenk’s Ap., 94 Pa., 37; Kneelder’s Ap., 92 Pa. 428; Wise’s Ap., 99 Pa. 196; Christine v. Whitehall, 16 S. & R. 98; Earley’s Ap., 90 Pa. 322.
    A judgment will not be opened when the testimony of the plaintiff and defendant counterbalance. Earley’s Ap., 90 Pa. 321; Zaring v. Earley, 2 Pears. 352; Cummons v. Hurlbutt, 92 Pa. 165.
    The defence set up is purely equitable, and the judge ought not to submit the case to a jury, unless the evidence is such that he would find himself bound as a chancellor to reform the instrument. Philips v. Meily, 106 Pa. 536; Brawdy v. Brawdy, 7 Pa. 157; North & West Branch R. R. v. Swank, 105 Pa. 555; Jackson v. Payne, 114 Pa. 67; Nichols v. McDonald, 101 Pa. 514; Knarr v. Elgren, 8 Cent. 828; English’s Ap., 12 Cent. 162.
    Per Curiam, Feb. 18, 1889. — The single assignment of error is that the court below refused to open the judgment. The ground set forth in the petition, upon which the defendant invoked the equitable powers of the court below, was that the note was falsely represented to her to be a note for $400, whereas it was in reality for $4,000, and judgment for this amount was entered against her. This averment in her petition was supported by her own oath alone, and is flatly contradicted by other testimony. This proceeding was the equivalent of a bill in equity to reform the note for fraud in its creation. In such cases, as we have said repeatedly, a chancellor will not interfere upon the unsupported oath of the petitioner. There must be more than oath against oath. If there is any testimony in the case which would have justified the learned court below in opening the judgment, it has not been pointed out to us, nor have we been able to find it.
    Decree affirmed, and the appeal dismissed at the cost of the appellant.
    
      Feb. 23, 1889. — Motion for re-argument.
    The appellant set forth, as ground for the motion, that she was advised by counsel that the supreme court, in considering her appeal, restricted itself to the consideration of the facts set forth in her original petition in the court below and the evidence in support thereof, and have not examined the case upon all the evidence and the points made by h§r counsel in argument. She therefore proposed to file an amended petition for the opening of the judgment against her, asking the court to consider the same as if filed in the court below.
    The petition for leave to amend, represented that,-when the petitioner filed her petition in the court below, she was ignorant of the following facts, that were afterwards proved by the witnesses of the plaintiffs below in the course of the examination and cross-examination, to wit:
    “ 1. That the plaintiffs below had not made over title to George W. Smith, by bill of sale or otherwise, of horses, wagons and harness of the value of about one thousand dollars, which the said plaintiffs promised this petitioner to so make over in part consideration of her signing the note in controversy at the time the same was signed.
    “ 2. That she did not know the indebtedness of $7,000 or $8,000 of Smith to the Swartleys was in large part for goods and money that were not covered by the surety agreement of 1884, to further secure which indebtedness the plaintiffs prove the note in controversy to have been given.
    “ 3. That she did not know that the plaintiffs below had extended their business dealings and changed the contract with Smith, under which she was primarily liable as guarantor, and that she had thereby been discharged from responsibility on said contract before the note in controversy was given, which liability is proved by plaintiffs to have been the consideration of said note.
    “ 4. That she did not know that the debt secured by the note in controversy had been in part paid off by collections made by the plaintiffs below since the note was given.
    “ 5. That she did not know that Smith had been using the goods of the plaintiffs below with their consent, and that the price thereof, and the rent of the store occupied by Smith, were wrongly charged in the account guaranteed by her under the contract of 1884, contrary to the terms of said contract.
    
      “ 6. That she did not know that the Swartleys had given time to Smith to pay the debt he owed them, in part security for which the note in controversy was given.
    “ And your petitioner further represents that all the above-stated facts are proved by the witnesses of the plaintiffs below, and that she is advised by counsel, and believes that they show good ground for opening the said judgment, and letting your petitioner into a defence.
    
      Feb. 25, 1889.
    “Your petitioner further represents that, by the agreement above referred to of 1884, jmur petitioner became responsible, as guarantor to the Swartley Brothers; for the price and value of goods sent to the said George W. Smith to be sold upon commission, and for the bills of the purchasers of said goods; and that the said agreement was violated, and changed, as is above set forth, without your petitioner’s knowledge by the said Swartley Brothers and the said George W. Smith, and that when your petitioner executed the note in controversy, which was proved by one of the plaintiffs and the said George W. Smith to have been given to secure her liability under said contract, she was in ignorance of the act and circumstances above set forth, which had released her from liability under said agreement.
    “ And your petitioner further represents that she is advised by counsel, and believes that when the case was called for argument in the court below, her said counsel advised the court that the ground of the application to open the judgment was much broader than that stated in the original petition, and that he proposed to amend the petition if the court deemed it advisable or necessary to the consideration of the application to open the judgment under all the evidence in the cause, but that the said court stated that they would consider the case under all the evidence as if the petition were amended, and that argument in said court then proceeded on the basis of said understanding, the counsel for the plaintiff below signifying no objection to such action.
    “ Wherefore, your petitioner prays that the above-stated facts may be considered as being herein averred, and that this petition be received and considered by the court as an amended petition, and as setting forth ground for the opening of said judgment.”
    
      Isaac S. Sharpe, for the motion.
    The ground of the action may be changed by amendment. Smith v. Bellows, 77 Pa. 441. And new breaches may be assigned by amendment. Coxe v. Tilghman, 1 Wh. 287. See also, Wilhelm’s Ap., 79 Pa. 121; Aultman’s Ap., 98 Pa. 505 ; Hopkins’s Ap., 90 Pa. 69.
    If the granting of the amendment be in the court’s discretion, the prayer should be allowed where it is entirely grounded on the opponent’s evidence.
   Per Curiam,

Re-argument refused.