Case Name: Daniel Reehl and Charles Reehl, Respondents, v. William H. Martens and Others, as Executors of and Trustees under the Last Will and Testament of Gerd Martens, Deceased, Appellants
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1899-05
Citations: 40 A.D. 231
Docket Number: 
Parties: Daniel Reehl and Charles Reehl, Respondents, v. William H. Martens and Others, as Executors of and Trustees under the Last Will and Testament of Gerd Martens, Deceased, Appellants.
Judges: 
Reporter: Appellate Division Reports
Volume: 40
Pages: 231–233

Head Matter:
Daniel Reehl and Charles Reehl, Respondents, v. William H. Martens and Others, as Executors of and Trustees under the Last Will and Testament of Gerd Martens, Deceased, Appellants.
A note of a third person given as a conditional payment of a debt —it must be produced or accounted for in an action to recover such debt.
In an action, brought to recover a balance alleged to be due upon a contract between the plaintiffs and the defendants’ testator, in which the sole question litigated was whether such balance had been paid by the delivery to one of the plaintiffs by one of the defendants of a past-due promissory note made by a third party, or whether the note was accepted by the plaintiffs as a conditional payment, it is essential that the plaintiffs produce the note which they claim to have taken as conditional payment, or give a good reason for its non-production.
Appeal by the defendants, William H. Martens and others, as •executors of and trustees under the last will and testament of Gerd Martens, deceased, from a judgment of the Supreme Court in favor -of the plaintiff, entered in the office of the cleric of the county of Westchester on the 31st day of October,' 1898, upon the verdict of ■a jury, and also from an order entered in said cleric’s office on the 4th day of November, 1898, denying the defendants’ motion for a .new trial made upon the minutes.
Terry Smith, for the appellants.
Robert McC. Robinson, for the respondents.

Opinion:
Willard Bartlett, J.:
This action was brought to recover a balance of $1,000 alleged to "be due to the plaintiffs upon a contract between them and the defendants' testator. The defense was payment, and the sole question litigated upon the trial was whether the balance conceded to be due under the contract had not- been paid by the delivery to the plaintiffs of the promissory note of. a third party. The note in question was not produced or put in evidence, but the proof indicates that it was a note of the D. G. Burton Company to the order -of E. K. Kane for $1,000, dated June 6, 1893, and payable three months after date, and that it bore the indorsement of the payee named therein. On or about the 16th of October, 1893, and, thereffore, after it was past due, this note was delivered by the defend ant William. H. Martens to Charles Reehl, one of the plaintiffs, Mr. Martens said that the plaintiffs then told him that they would-take the note in payment of .the balance due, and they gave him at-that time a receipt in full for all demands Under the contract. Mr. Charles Reehl, on the other hand, swore that they took the note-only as a conditional payment.
There is nothing in the record to indicate precisely what the. condition was to which he thus referred. The contention of the defendants was that the plaintiffs were indebted to the D. G. Burton Company in an amount somewhat in excess of $1,000, and that with the note, which was made by the D. G. Burton Company itself, they were enabled to discharge the greater part of their obligation to-that corporation. According to the plaintiffs, however, their effort to make use of the note in that .way proved ineffectual, and they derived no benefit- whatever from the instrument. There was adit ect conflict of proof as to whether the note had been accepted in payment of 'the balance due upon the contract between the plaintiffs and the -defendants' testator, and this question- was very fairly submitted to the jury'in a charge to which no exception was taken. The jury rendered a verdict in favor of the plaintiffs, thus finding that they had not taken the note in payment of their claim; and. with this determination there would be no occasion to interfere were it not for the failure of the plaintiffs to produce the note upon the-trial, or satisfactorily- account for its non-production.
The testimony as to what has become of the note is very meagre,, but it appears to have been turned over, shortly after it was received by the plaintiffs, to a man named Thomas F. French, a person in the employ of John Duffy, the sheriff of Westchester county, who at that time was in possession of the office of the D, G. Burton Company under the authority of certain warrants of attachment. What-French did with the note is not disclosed. Mr. Charles Reehl testified that he never saw it after it was delivered to French on October 16, 1893, and Mr. Daniel Reehl, the other plaintiff, testified that he never had the note in his possession after that date.
" The taking a note, either of a debtor or of a third person, for a. precedent debt is no payment unless it be expressly agreed to take the note as payment' and to run the risk of its being paid; or unless-the creditor parts with the note, or is guilty of loches in not pre sen ting it for payment." (Elwood v. Deifendorf, 5 Barb. 398, 408.) In a suit on a debt, however, it is a good plea that a note made by a third person was given by the defendant to the plaintiff and was accepted by him in payment of the debt. To destroy the effect of this plea, the plaintiff may show, if he can, that he did not in fact accept the note in payment; but even then, if he took the-note upon a condition which ha,s not been fulfilled, and which, therefore, rendered it ineffectual to discharge the' original obligation, he must produce the instrument upon the trial, or give a sufficient reason for not producing it, before he can be allowed to recover the amount of his debt. (Holmes & Drake v. D'Camp, 1 Johns. 35.) "AsT understand that case," said Spencer, J., in Burdick v. Green (15 Johns. 247), "we adopted this rule, that-when it appeared that a negotiable note had been given for a prior debt, we would not suffer the plaintiff to recover on the original consideration, unless he showed the note to have been lost, or produced and canceled it at the trial."
Under the circumstances of the present case, therefore, it would seem to be essential to the plaintiffs to produce the note which, according to their own account, they took from the defendants as a conditional payment upon their contract, or assign a good reason in law for its non-production, before they can maintain an action to recover upon the original consideration arising out of their contract. This they may be able to do upon another trial, when all the facts relating to the disposition of the note can be more fully presented.
1 think we must reverse this judgment.
All concurred.
Judgment and order reversed and new trial granted, costs to abide the event.