Case ID: tenn_36/html/0512-01.html
Source: Caselaw Access Project
Author: {"author": "McKinney, J.,", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Guy Ellis vs. Harvey Hamilton.
    1. Evidence. To impeach sealed instruments. Acts of 1850, ch. 20, § 1, and ch. 60, $ 1. Bills and notes. The acts of 1850, ch. 20, § 1, and ch. 60, $ 1, which make the rules of evidence the same in suits upon sealed and unsealed instruments, do not change or modify the doctrine of the common law which excludes evidence of any parol engagement, made anterior to or contemporaneous with the execution of a written contract, to alter or qualify the terms thereof.
    2. Same. Bills and notes. In an action on a promissory note or hill of exchange, the defendant will not he allowed to give parol evidence of an agreement between him and the plaintiff, at the time of making the note, that it should be renewed, and that payment should not he demanded on its becoming due; or that a note purporting to he payable on demand was intended by the parties to be payable on a contingency ; or that a note payable on a certain day was intended to be payable on some other day; or that it was to be paid out of a particular fund; or that it should be paid in any other mode than is imported on its face.
    3. Same. In suit on sealed instrument. Case in judgment. In an action of covenant against the security to an obligation for the payment of money without condition, on a day stated, it is held that a plea by the defendant that, at the time of the execution thereof, it was verbally agreed with the plaintiff that the property for which the same was given was to be sold and applied to the payment thereof — that the plaintiff was to assist the principal in the sale, and receive the proceeds; and that, by his laches in that respect, the , money had been received by the principal, and thereby lost to the plaintiff — was demurrable.
    4. Cases cited. Bryan vs. Sunt. Vid. post.
    
    EROM HAWKINS.
    The plaintiff brought his action of covenant in the Circuit Court of Hawkins county against the defendant on " the following instrument:
    
      “ On tbe second day of January next we jointly promise to pay Guy Ellis twelve hundred and ninety dollars and eighty-nine cents in current bank notes for value received of him. Given under" our hands and seals this 7th day of December, 1853.
    “T. J. Mills, n
    “ Harvey Hamilton.” /
    The defendant Hamilton was alone sued in this action. He filed four pleas, only one of which is material to be stated. The substance of this plea was, that he was merely surety for Mills in said obligation; that at the time of the execution thereof the plaintiff agreed verbally with him and his coobligor that he would assist Mills in disposing of the property for which the obligation was given; that he would look to the proceeds thereof for payment; that he would remain with Mills and see that the same was sold and the proceeds properly applied. The plea avers that the plaintiff, in disregard of said agreement, suffered Mills to sell the property himself, and, by his neglect, the proceeds were lost to him. To this plea there was a demurrer, which the Court disallowed. A replication traversing the averments of the plea, and an issue thereon, was, with the other issues in the cause, submitted to a jury at the January Term, 1857, before Judge PATTERSON, which resulted in a verdict and judgment for the defendant. , The plaintiff appealed in error.
    C. W. Hall, for the plaintiff.
    James T. Shields, for the plaintiff, said:
    
      1. There is no better-settled principle of evidence than that “ parol contemporaneous evidence is inadmissible to contradict or vary the terms of a valid written instrument.”
    “It is a general rule of law that extrinsic evidence cannot be admitted to contradict, add to, subtract from, or vary the terms of a will, deed, or written agreement.” Phillips on Ev., vol. 2, Bd ed., p. 350.
    When parties have deliberately put their engagements into writing, in such terms as import a legal obligation, without any uncertainty as to the object or extent of such engagement, it is conclusively presumed that the whole engagement -of the parties, and the extent and manner of their undertaking, was reduced to writing; and all oral testimony of a previous colloquium between the parties, or of conversations or declarations at the time when it was completed or afterwards, as it would tend in many instances to substitute a new and different contract for the one which was really agreed upon, to the prejudice, possibly, of one of the parties, is rejected. 1 Greenl., 359.
    But it is deemed useless to cite authorities in support •of a principle so well established, and which has been so often applied in our own practice. See Campbell vs. Up-shaw, 7 Humph., 185; Noe vs. Hodges, 3 Humph., 162.
    In the case of Richardson vs. Thompson, 1 Humph., T51, this Court said that it is a maxim and general rule, early adopted and recognized alike in Courts of Law and Courts of Equity, that the terms and extent of an agreement under seal shall not by the admission of parol proof be contradicted or enlarged, diminished or varied.
    Now the obligation on which this suit is founded is for the payment of money in positive and absolute terms; but these pleas propose to add by parol, and which was actually done upon the trial, (assuming the proof to be credible and satisfactory,) conditions and stipulations which would most materially vary the contract. This cannot be done. There is no pretence, no plea that there was fraud, mistake, or accident in the writing of the instrument. It is, therefore, thought that this case is one for the application of this rule of evidence, and does not come within any of the exceptions to it.
    But it is insisted that the act of 1850, ch. 20, § 1, has altered this rule of the common law. The act is in the following language: “ That hereafter, in all suits in the Circuit Courts of this State and before justices of the peace upon bills, bonds, or other instruments under seal, the rules of evidence shall be the same as if such instruments were not under seal, and the parties may plead and give in evidence all matters which, by the existing laws, may be pleaded or given in evidence to similar instruments not under seal.” “The rules of evidence shall be the same as if such instruments were not under seal,” and “the parties may plead and give in evidence all matters which may be pleaded or given by the existing laws to instruments not under seal.”
    Now, the rule which we have been insisting upon never was confined to sealed instruments, but applied alike to all written contracts, whether under seal or not. 1 Greenl., § 276; 2 Phillips, 3d ed., p. 350.
    The statute simply enacts that such matters may be averred and proved in defence as now may be to simple contracts. The statute therefore does not nor was it intended to affect this rule of evidence. Its only object was to allow such defences to be made in an action on a sealed instrument as could be made to an action on a simple contract. Before its enactment, a Court of Law could not inquire into the consideration of a sealed instrument as it could into the consideration of a simple contract. 1 Yerg., 33-36. And the party was driven to a Court of Equity. This statute gives the legal forum the jurisdiction. And other eases might be put upon which the statute will operate, but all of which were before this act beyond the scope of legal redress, simply because of the solemnity of the instrument.
    This act annihilates the sanctity, so to speak, of the seal. It does nothing more. It does not alter the great and well-established principle of evidence on which we are insisting.
    J. B. Heiskell, for the defendant.
   McKinney, J.,

delivered the opinion of the Court.

This was an action of covenant, founded on the following obligation:

“On the second day of January next we jointly promise to pay Guy Ellis twelve hundred and ninety dollars and eighty.-nine cents in current bank notes for value received of him. Given under our hands and seals this 7th day of December, 1853.

“T. J. Mills,

“ITaevey Hamilton.”

At the appearance term, a nolle prosequi was entered as to the defendant Mills. The defendant Hamilton, among various other matters of defence which need not he here noticed, pleaded “that he executed said covenant as the surety of Mills; and that, at the time of the execution thereof, it was understood and agreed that certain property which was then in the hands of said Mills should he sold to pay the same, (being the same property for which said obligation was given;) and that Ellis, the plaintiff, should accompany Mills until the said property should he sold; and should receive and take the proceeds of the same, or so much thereof as would pay the sum of money in said covenant mentioned, and apply the same in satisfaction thereof; and that the plaintiff, by his own negligence, laches, and default, failed to take and receive the proceeds of said property, and allowed the same to go into the hands of said Mills.” And upon these facts the plea alleges, in conclusion, that the liability of defendant upon said covenant is discharged. To this plea there was a demurrer, which was overruled. A replication was then filed, traversing said plea, upon which issue was taken. This issue, as well as the other issues in the case, was found for the defendant; and a new trial having been refused by the Court, the plaintiff appealed in error to this Court.

Without considering the case upon the proof adduced in support of the foregoing plea, we will proceed to inquire into the validity of the plea itself, as that is the first question properly arising upon the record, and in our judgment it is, for the present at least, decisive of the case.

Eor the defendant Hamilton, it is argued that, notwithstanding the instrument declared on is under seal, he is entitled, under the acts of 1850, ch. 20, § 1, and ch. 60, § 1, to aver and prove by parol evidence that he was merely the surety of Mills in the^, obligation, and to avail himself of all matters of defence that would be available for him in an action upon a promissory note or other unsealed instrument.

Admitting this to be so for the present, the question is, would the plea constitute an available defence to an action on a promissory note or other unsealed instrument?

In another case at the present term (Bryan vs. Hunt) we have recognized the rule that it is not allowable to vary or contradict the terms of an unsealed written instrument by parol evidence of previous or contemporaneous stipulations or terms not incorporated therein.

What is attempted by the plea ? To contradict the absolute and unconditional engagement of the defendant to pay the plaintiff on a day fixed $1290 89, in current bank notes, by parol evidence of a contemporaneous agreement; or, in the language of the plea, by an agreement at the time of the execution of the covenant that really he was not to pay said sum of money at all, but that it was to be paid in a mode altogether different from that imported on the face of the obligation.

The doctrine is well established that, in an action on a promissory note or bill of exchange, the defendant will not be allowed to give parol evidence of an agreement between him and the plaintiff, at the time of making the note, that it should be renewed, and that payment should not be demanded on its becoming due; or that a note, purporting to be payable on demand, was intended by the parties to be payable on a contingency; or that a note payable on a certain day was intended to be payable on some other day; 2 Phillips on Ev., (ed. of 1848,) p. 357; or that it was to be paid out of a particular fund; Chitty on Con., (ed. of 1848,) p. 102, and cases cited in note A; or that it should be paid in any other mode than is imported on its face. 4 Phillips on Ev., note 294, p. 591, and cases referred to.

It is not necessary to refer to the rules applicable to subsequent agreements; or to independent collateral agreements ; or where the whole contract has not been reduced to writing, and this is apparent from the face of the writing; or to cases of parol contract, where the giving of a note by one party does not merge the parol contract ; as, for instance, where a personal chattel is sold with warranty by parol contract, and a note is given for the purchase-money. Between all these, and perhaps other exceptional cases, and a case like the one in judgment,where it is attempted to give effect to a prior or contemporaneous verbal contract to vary or contradict a written agreement, there will be found on careful examination a clear and well-marked distinction.

We are of opinion, therefore, that the Court erred in overruling the demurrer to the above plea. The judgment will be reversed, the demurrer sustained, and the case remanded, with leave to amend the pleadings, if a proper case shall be made for an amendment.