Case Name: Edwin R. Lawrence, App'lt, v. Dwight B. Baker, Resp't
Court: New York Supreme Court, General Term
Jurisdiction: New York
Decision Date: 1887-05-24
Citations: 8 N.Y. St. Rep. 563
Docket Number: 
Parties: Edwin R. Lawrence, App’lt, v. Dwight B. Baker, Resp’t.
Judges: 
Reporter: New York State Reporter
Volume: 8
Pages: 563–567

Head Matter:
Edwin R. Lawrence, App’lt, v. Dwight B. Baker, Resp’t.
(Supreme Court, General Term, Third Department,
Filed May 24, 1887.)
1. Statute of limitations—What a" payment under—Code Ciy. Pro., § 395.
The giving by a debtor of a note of a third person to apply on his debt is a payment under the statute of limilations. Code Civ. Pro., §395. It is immaterial so far as the effect of payment goes whether the debtor pays cash, or in chattels, or in the obligations of another.
2. Same—Debtor’s own note not a payment under—An acknowledgment.
When he gives his own notes he parts with nothing of value, he only-makes a new promise in a new form, but he makes a written acknowledgment or promise under the section cited above.
3. Same—Written acknowledgment takes effect from delivery.
The time when the acknowledgment or promise is actually delivered (not the time when it is payable) is the time when it takes effect, in respect to the statute of limitations as a written promise or acknowledgment.
4. Same—Effect of payment of debtor’s own note.
The defendant gave his note to the plaintiff for part of a certain debt, which note the plaintiff had discounted at the bank. Meld, that payment to the bank of the note was no admission by defendant of any other indebtedness to the plaintiff. Landon, J., dissenting.
5. Same—When payment does not take case out of statute.
When the debtor is in such a position that he has to make the so-called payment, whether he owes the debt or not, then there is no longer any admission.
Motion for a new trial by the plaintiff upon exceptions directed to be heard in the first instance by the general term. See statement of facts prefixed to dissenting opinion of Landon, J.
James J. Curtis, for appl’t; Garret Z. Snider, for resp’t.

Opinion:
Learned, P. J.
The giving by a debtor of a note of a third person to apply on his debt, is a payment under the statute of hmitation (Smith v. Ryan, 66 N. Y., 352; Code Civ. Pro., § 395), because it is immaterial, so far as the effect of payment goes, whether the debtor pays in cash, or in chattels, or in the obligation of another. In either case he parts with something of value and transfers it to the creditor to apply on the debt.
But when he gives his own note he parts with nothing of value. He only makes a new promise in a new form. He makes a written acknowledgment or promise under the section above cited. Kincaid v. Archibald, 73 N. Y., 189. Whether he makes any written acknowledgment or promise, except to the extent of the note which he gives, seems to me doubtful. A man who makes a note promising to pay $300, does not thereby acknowledge that he owes, nor does he promise to pay, $460. If there be any presumption, it is that the amount of the note is all that he owes.
At any rate the time when the acknowledgment or promise is actually delivered is the time when it takes effect in respect to the statute of limitations as a written promise or acknowledgment. Kincaid v. Archibald, ut supra. If then, the giving of the $300 note was an acknowledgment or promise under section 395, in respect to the alleged residue of the debt, it was such at its delivery; and the statute of limitations began again to run from that time as to the alleged residue. As to that $300, the statute did not begin to run until maturity of the note, three months later.
Assuming then (which I doubt), that the giving of the $300 was an acknowledgment or promise as the alleged balance of $162, its effect was to make the statute of limitations run as to the $162 from July 1, 1878, the time of the giving of the note; while as to the note itself, the statute would begin to run only from maturity, viz., October 4, 1878.
The plaintiff at once had the note discounted at the bank. No direct proof is given of the payment of the note, but it may be inferred that it was paid by defendant at some time; whether before or after maturity is not shown. This action was commenced September 29, 1884. If, then, the defendant paid that note a week before it was payable, all the plaintiff's argument falls. And if the plaintiff tries to take a case out of the statute of limitations on the ground of payment, he should show positively when the payment was made.
But even assuming that payment was made on the exact day of maturity, the plaintiff is no better off. The defendant could not avoid the payment. The note had passed into the hands of the bank and was evidently negotiable.
The defendant had no alternative but to pay. He could not have defended on the ground that he owed plaintiff nothing. Now there is no mysterious virtue in a payment. It is held to avoid the statute of limitations, because, by making a partial payment, the debtor admits the debt. The courts say: "Why did he make a partial payment if he did not owe the debt." Harper v. Fairley, 53 N. Y., 442. Now when the debtor is in such a position that he has to make the so-called payment whether he owes the whole debt or not, then there is no longer any admission. This defendant was obliged to pay his note at the bank, whether he owed plaintiff any balance or not; or even whether he had ever owed plaintiff anything. Therefore the payment of the note was no admission by the defendant of any indebtedness to the plaintiff. The bank was not plaintiff's agent, but held the note in its own right. Defendant's money, when he paid, did not go to the plaintiff but to the bank. The payment was no admission of any facts except such as might have served as a defense to the note, if the defendant had refused to pay. And that he did not owe the plaintiff would not have been such a fact. Therefore he did not admit his indebtedness to the plaintiff by paying this note.
Judgment should be granted for defendant on the non-suit, with costs, and motion for new trial denied.