Case ID: mass_10/html/0056-01.html
Source: Caselaw Access Project
Author: {"author": "\n      Per Curiam.\n    ", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Henry Chapman versus Cornelius Durant and Others.
    A negotiable promissory note, given by a part owner of a vessel, who was also the ship’s husband, for supplies furnished the vessel, discharges the other owners from their liability for such supplies.
    This action, which was in assumpsit upon an account annexed to the original writ, was tried before Parlcer, J., November term, 1811, when a verdict was taken for the defendants, subject to the opinion of the Court upon the following facts agreed by the parties: — [ * 48 ] * The three defendants, Durant, Maynard, and Lamb,
    
    were owners of a vessel called the Louisa; one moiety thereof belonging to Durant, and the other moiety to the other two defendants; these latter having provided the furniture and outfits for previous voyages, received and disposed of the cargoes, and paid all expenses and port charges relating to said vessel, for all concerned.
    On the 21st of April, 1809, articles of ship chandlery were supplied by the plaintiff to the amount of 89 dollars 85 cents; and in September following, other articles, to the amount of 138 dollars 84 cents; for which sums this action was brought.
    In the plaintiff’s book of original entries, the charges were made -from day to day, as these articles were furnished. In some instances, the entries were, “ Maynard 8f Lamb Drs. Brig Louisa,” — and in others, “Brig Louisa Dr. Maynard &f Lamb.” — After all the articles which the vessel required were delivered, the charges were transferred to the plaintiflí’s book, called the ship-book, in which “ Maynard Sf Lamb and I tie owners of the Louisa ” were made debtors; and a bill for the articles furnished in April, and another for those furnished in September, in which “ Maynard &f Lamb and the owners of the Louisa ” were made debtors, were at those times delivered to Maynard fy Lamb.
    
    In all instances in the ship-book, the charges were made to certain persons and the owners of the vessel, eo nomine, whether there were other owners or not. But in the plaintiff’s legers, in an account including these articles, and others for the supplies of vessels of which said Durant was part owner, with others in which he had no concern, and in others in which Maynard Lamb were, in fact, the only debtors, these latter were alone made debtors; although in the same page of the leger is contained an account of the plaintiff with another person, where he and the owners of the vessel, eo nomine, are made debtors.
    [ * 49 ] * In the months of September and December, 1809, two several accounts, copied from the leger as aforesaid, were presented to Maynard &f Lamb, naming them only as debtors, who thereupon charged Durant with his proportion of the articles furnished this vessel.
    On the 4th of January, 1810, Maynard Lamb gave their negotiable note to the plaintiff for the amount of said account, payable in sixty days, and a separate receipt was given, expressing the note to have been received on account, the sum in the note being the foot of the account. This transaction took place in the street, and the parties had not the account with them.
    The note was endorsed by the plaintiff, and also by another person, and discounted at a bank for the plaintiff; and was afterwards taken up by him, and was produced at the trial, the said Maynard
    
    
      Lamb having failed before the note became due. No credit was given for said note in the books of the plaintiff to Maynard Lamb.
    
    The said Durant, for some months before and after these trans actions, resided in the West Indies, and, at the time when these articles were furnished, had large funds in the hands of Maynard S/ Lamb, and continued so to have until after their failure, which happened in February, 1810. They also received from and paid to said Durant moneys to a large amount after the date of these charges; but after those dates, they paid him more moneys than they received; and they still remained, at the time of the trial, greatly indebted to him.
    The fact of there being another part owner of said vessel, other than said Maynard Lamb, was known to the plaintiff; but he did not know that said Durant was that person.
    No advances had been made by Durant to Maynard 8f Lamb since the date of said note. After the commencement of this action, they settled their accounts, in which the said articles were charged to Durant; but it was not then, nor has it since been, in his power to obtain any payment from said Maynard &f Lamb.
    
    * It was agreed by the parties, that the verdict in this [ * 50 j case should be set aside, and judgment entered for the plaintiff for 228 dollars 69 cents and costs, if the Court should be of opinion that upon these facts he ought to recover; otherwise the verdict to stand, and judgment accordingly.
    
      Prescott, for -the plaintiff,
    contended that all the owners of the vessel, whether known to him or not, were liable originally for these supplies It was plain, too, from the manner of the plaintiff’s entering the charges in his books, that he meant to charge all the owners, knowing, as he did, that there were other owners than those whose names were known to him. And he would have been enti
    
      ded to his remedy against the owners generally, had Maynard ¡¡¡' Lamb acted only as agents for the owners, or had the plaintiff, at the time of the transaction, supposed them the sole owners of the vessel. 
    
    The note or bill of an agent is no discharge of his principal, unless the principal is thereby prejudiced, or put in a worse situation.  Nor does the note or bill of the principal operate as payment, but only as an extension of the credit; unless so expressly agreed, which was not the case here, or unless negotiated, or the creditor is guilty of laches. 
    
    
      Ritchie for the defendants. Where one charges one or more of several debtors, knowing that there are others, he must be presumed to rely wholly on those whom he expressly makes his debtors. All the evidence in the case at bar shows that the plaintiff considered Maynard fy Lamb as his debtors, without relying on any other. He could not rely on Durant, since he did not know of his interest in the concern. His intention to depend wholly on them is clearly proved by his taking their note in payment. 
    
    But if Durant was originally liable for the supplies, he was discharged by the negotiable note received by the plaintiff in payment. In the case of Thatcher vs. Dinsmore, 
       the Court declare that it is the settled law of this state, that “ a negotiable note, given in consideration of a simple contract debt due, is a discharge of the simple contract,” unless an express agreement be proved, [*51] that the note should * be received as collateral security.
    In the case at bar, the consideration for the note given was the plaintiff’s account. He gave a receipt “ on account; ” but this arose merely from the transaction taking place in the street, where the plaintiff had not his account, or his books. It must have been the understanding of the parties, that the amount was to be credited against the account in the plaintiff’s books.
    
      
      
        Campbell’s N. P. 85,109.
    
    
      
       3 East. 147.—7 Johns. 311.
    
    
      
       1 Esp. Rep. 5. — 8 Johns. 391. — Chitty on Bills, 82. — 5 D.fyE. 516. — 1 Burr 9.-5 Johns. 72. — Cooke’s B. L. 173.
    
    
      
       4 Esp. 89.-5 Esp. 122.
    
    
      
       5 Mass. Rep. 299.
    
   Per Curiam.

By the law merchant the defendant Durant, from the facts agreed in this case, was originally liable to the plaintiff’s demand, as he was a part owner of the vessel. But by the plaintiff’s taking and negotiating a negotiable promissory note from some of the owners, for the sum demanded in this action, the case is brought within the principle often recognized by the courts of law in this commonwealth, that a negotiable promissory note, given in consideration of a debt due by simple contract, is a discharge of such contract. The action is not supported, and there must be

Judgment on the verdict.

ADDITIONAL NOTE.

[See Tufts vs. Kidder, 8 Pick. 537. —Hanna vs. Pegg, 1 Blac. 183. — Abercrombie vs. Mostly, 9 Port. 145. — Crockett vs. Trotter, 1 Stew. & P. 446.— Higgins vs. Packard, 2 Hall, 226.

Giving a note for a preexisting debt does not discharge it, unless it is agreed that the note be taken in payment. — Bank of U. S. vs. Daniels, 12 Pet. 32. — Davidson vs. The Borough, &c., 8 Conn: 472.— Bill vs. Porter, 9 Conn. 23.—Glenn vs. Smith, 2 Gill & J. 493. — M' Gain vs. Holmes, 2 Watts, 121.

In Maine, a negotiable note, or order, when received by a creditor from his debtor, is presumed to be taken in payment of the prior debt. But this presumption may be controlled by proof of an express agreement to the contrary, or of usages or circumstances inconsistent with it.— Varner vs. Nobleborough, 2 Greenl. 121. — Descadillas vs. Harris, 8 Greenl. 298. — Such instrument, given in a foreign country, will not extinguish a debt created there, unless the laws of that country so provide. — Descadillas vs. Harris, 8 Greenl. 298. — A note not negotiable, given for a subsisting account, is no bar to an action on the account.— Trustees, &c., vs. Kendrick, 3 Fairf. 381.—See Gilmore vs. Bussey, Ibid. 418.

See Hutchins vs. Olcott, 4 Verm. 549, acc. —Depeau vs. Waddington, 6 Whart. 220.

Reid vs. Morrison, 2 Watts & Serg. 401. — Beltzhoover vs. Com. 1 Watts, 126.

Where a creditor receives from his debtor a draft or bill of exchange, in full satisfaction of the debt, when paid, this is primd facie evidence of payment; and, to rebut it, in an action upon the original debt, the plaintiff must prove diligence in collecting the bill, and notice of non-payment, if unpaid, or some excuse for non-presentment ; and he must produce the bill at the trial to be cancelled, — Dayton vs. Trull, 23 Wend. 345. — 9 Conn. 23—or prove it to be lost. — 2 Gill & J. 493.

A and B, partners, gave their note for a partnership debt, in full satisfaction and discharge. The firm subsequently dissolving, A, for a consideration paid by B, agreed to assume and pay the original debt, and accordingly took up the note, and gave his own instead of it. Held, A and B were still liable upon the original debt. — Cole vs. Sackett, 1 Hill, (N. Y.) 516. — But see Lamkin vs. Phillips, 9 Por. 98.

The holder of a note, on the day when it became due, accepted from the maker a check upon a bank, drawn by a firm consisting of the maker and one A, dated six days afterwards, to be in full satisfaction, if paid when- due. Held, this suspended the remedy against the maker, and discharged the endorsers. — Okie vs. Spencer, 2 Whart. 253. — See Nichol vs. Bate, 10 Yerg. 429.

The words “ in payment of the above account,” contained in the receipt for a note, do not prove an agreement to take the note as payment, and discharge the account. — 2 Gill & J. 493.

If a creditor accept a note from his debtor, his right of action is suspended till maturity of the note. — Ibid. — See Lishy vs. O'Brien, 4 Watts, 141.

A note under seal, with a warrant to confess judgment, of one partner, for a simple contract debt of the firm, taken “ when paid to be in full,” is not an extinguishment of the original debt, nor is a judgment upon it a bar to a subsequent action against the firm. —Wallace vs. Fairman, 4 Watts, 378. — Otherwise, in case of the acceptance of a specialty from one partner, or recovering a judgment against him. — Anderson vs Levan, 1 Watts Serg. 334. — See Bitzer vs. Skunk, Ibid 340 - Cash vs. Tozer Ibid 519.

See Spear vs. Gillet, 1 Dev. Equ. 466. — Horton vs. Child, 4 Dev. 460.—Armsby vs. Famam, 16 Pick. 318.—Averill vs. Lyman, 18 Pick. 346.— Goldshede vs. Cottrell 2 Mees. & W. 20. — Lumley vs. Musgrawe, 4 Bing. U. S. 9.—F. H.] 
      
      
         [According to the English law, this decision is clearly wrong. Neither a promissory note, nor a bill of exchange, will operate as payment, or a discharge of the original debt, unless where the debtor has sustained an injury by the laches of the creditor, in not making a demand upon, or giving notice to, some party on the bill or note.— Bayley, 4th ed. c. 9, sec. 1, pi. 58—64. — Chitty, 6th ed. 97—100. — Thomson on Bills, 192,194. — 1 Petersdorf, Mr. 126, and cases cited in a note. — But in order to maintain an action, it must be shown that the note, or bill, has been dishonored, and it must be produced or accounted for at the trial. And so is the Scotch law. — Thom son, ub. sup. — It may not be altogether useless to examine the cases upon which the doctrine laid down in the text rests. In Greenwood vs. Curtis, (4 Mass. Rep. 93,) it was held that a note not negotiable could not operate as payment, or a discharge of an original debt. In Thatcher vs. Dinsmore, (5 Mass. Rep. 303,) Parsons, C. J., in delivering the opinion of the Court, cited the case of Warren, Admr. of Wheelwright, in which he said it was decided, before the revolution, that a negotiable note, given in consideration of a simple contract debt, was a discharge of the simple contract. But he intimated that this was a presumption which might be rebutted. In Maneely vs Magee, (6 Mass. Rep. 145,) a case somewhat like the case reported in the text, Par sons, C. J., in giving the opinion of the court, said, “ it had been long settled that when a debtor shall give his creditor his negotiable note for a debt due on simple contract, the legal presumption is that the note was received in payment; but that this, like all other presumptions, might be rebutted.” And in this case it was held not to ope rate as an extinguishment of the parol contract. In Goodenow vs. Tyler, (7 Mass Rep. 43,) Parsons, C. J., said, “ it had been settled by a series of decisions, which could be traced back sixty years, that when a negotiable note is given to secure the payment of money due by simple contract, the simple contract is holden to be satisfied or merged in the note.” And Sedgwick, J., in the same case, said, “ A promissory note, given and received for goods at the time of the sale of them, is payment as much and as effectual, to all intents and purposes, as cash. A previously-existing parol con tract, as the law is here understood, would have been merged by it as completely as it would have been by a bond, recognizance, or deed of any kind.” In Johnson vs Johnson, (11 Mass. Rep. 362,) the doctrine laid down in Thatcher vs. Dinsmore, and Maneely vs. Magee, is recognized as law by Parker, C. J., in giving the opinion of the court. In Hemenway vs. Bradford, (14 Mass. Rep. 121,) it was held that an action for return premium would lie, before the premium note, which had not been negotiated, had been paid. And this decision is recognized as law in Russell vs. Digrand, (15 Mass. Rep. 38.) In Whitcomb vs. Whiting, (4 Pick. 229,) it was held that a negotiable note, given for a simple contract debt, was equivalent to payment in money ; and that if, by mistake, it should be given for more than the just amount of the debt, the ex cess might, even before payment of the note, be recovered by the promisor of the creditor, in an action for money had and received. In Wiseman & Al. vs. Lyman, (7 Mass. Rep. 286,) it was held by Sedgwick, J., in giving the opinion of the court, that a promissory note of a third person, received for a stated balance of a merchant’s ac count, would be a complete discharge of the original debt. — But see Tucker vs. Max-well, 11 Mass. Rep. 143. —From the above cases it appears that the language of the court has not always been precisely the same. Sometimes it has been said that receiving a negotiable promissory note operates as an extinguishment and discharge of the simple contract, in like manner as would a bond or deed; sometimes it has been said to be equivalent to, and to be considered as, payment in cash; and sometimes 'it has been said to be only primé facie evidence of payment. The reason given for these decisions has uniformly been, that to hold otherwise would subject the defendant to pay his debt twice. But this is not very apparent. It would seem to be enough to require the plaintiff to produce or account for the note, or bill, at the trial. These decisions are not very consistent with the doctrine held by the same court in regard to the admissibility of a promissory note in evidence to support the money counts in a suit by the promisee or endorsee against the maker, or to support a claim in set-off for money paid. — Young vs. Adams, 6 Mass Rep. 152. — State Bank vs. Hurd, 12 Mass. Rep. 172. — Truesdell vs. Wallis, 4 Pick. 63. — Wild vs. Fisher, 4 
        
        Pick. 421. — Sargent vs. Southgate, 5 PicA;. 313. — It is much to be regretted that there has been an inclination in our courts to establish local law, so inconvenient tc the mercantile world, and so contrary to the settled rules of the common, law. The American courts generally have followed the common law.— Clark vs. Young, 1 Cranch, 181. — Pintard vs. Tackington, 10 Johns. Rep. 104.— Tobey vs. Barber, 5 Johns. Rep. 68. — Murray vs. Governeur, 2 Johns. Cas. 438. — Holmes vs. Decamps, 1 Johns. Rep. 34.—Putnam vs. Lewis, 8 Johns. Rep. 304. — Burdick vs. Green, 15 Johns. Rep. 247. — Johnson vs. Weed, 9 Johns. Rep. 310.— Smith vs. Lockwood, 10 Johns. Rep. 366. — The People vs. Howell, 4 Johns. Rep. 296. — Sheeby vs. Madeville, 6 Cranch, 253. — Elliot vs. Steeper, 2 N. H. R. 525.— Cheever vs. Mirick, 2 N. H. R. 376. — And as resembling the case in the text, more nearly, see, Schemerhorn vs. Loines, 7 Johns. Rep. 310. — Smith vs. Rogers, 17 Johns. Rep. 340. — Muldon vs. Whithlock, 1 Cowen, 290. — Keun vs. Dufresne, 3 Serg. & Rawle, 233. — But see Varner vs. Nobleborough, 2 Greenl. 121.— Ed.]