Case Name: Fareira v. Smith
Court: New York Court of Common Pleas
Jurisdiction: New York
Decision Date: 1893-04
Citations: 3 Misc. 255
Docket Number: 
Parties: Fareira v. Smith.
Judges: 
Reporter: New York Miscellaneous Reports
Volume: 3
Pages: 255–258

Head Matter:
Fareira v. Smith.
(New York Common Pleas
General Term,
April, 1893.)
Plaintiff, to substantiate her claim of a loan to defendant, offered in evidence an instrument in the words following:
" American Loan and Trust Co., Registrar of the Certificates New York Stock Trust. Trustees: Roderick H. Smith, Manager; Geo. Oondit Smith, Secreta/ry; Geo. F. Shaver.
“ New Yoke, Dec. 10, '90.
“ Received from Mrs. M. Barker Fareira, as a loan, one thousand dollars, to be returned Jan. 1st, 1891.
“ RODERICK H. SMITH.”
Defendant offered to show that the money was never received by him, and was in fact loaned to the New York Trust. The court refused to receive the evidence on the ground that it varied the legal effect of the written instrument, EM, error.
Appeal from judgment of the General Term of the Oity ■Court of Hew York, which affirms a judgment for plaintiff, entered upon a verdict in her favor, and from an order denying defendant’s motion for a new trial on the minutes.
Action to recover for moneys alleged to have been loaned by plaintiff to defendant. The defenses were a general denial .and that the loan was not made to defendant, but to a third person, through defendant as the medium.
Adol/ph I. Sanger, for plaintiff (respondent).
Theron G. Strong, for defendant (appellant).

Opinion:
Bischoff, J.
To substantiate her claim of a loan to defendant, plaintiff gave in evidence the following instrument:
"American Loan and Trust Co., Registrar of Certificates New York Stock Trust, 6 Wall street.
" Trustees : Roderick EL Smith, Manager; Geo. Oondit Smith, Secretary / George F. Shaver.
"New York, Dec. 10, 1890.
"Received from Mrs. M. Barker Fareira, as a loan, one thousand dollars, to be returned Jan'. 1st, 1891.
" RODERICK H. SMITH."
and the trial court excluded oral evidence offered by defendant which tended to show that the sum mentioned was never received by him, and was in fact loaned to the New York Stock Trust, on the ground that the evidence excluded varied the legal effect of a written instrument, to which defendant's counsel duly excepted.
The exception was well taken and the judgment and order appealed from should, therefore, be reversed. In DeLavallette v. Wendt, 75 N. Y. 579, the instrument was as follows: " $500. " New York, November 3, '66.
" Received from D. M. Peyser five hundred dollars, due on demand."
It was held that the instrument did not sufficiently name a payee, bearer or otherwise; that the effect of the omission was to render the instrument a mere receipt of the payment of money and as such open to explantion by parol evidence. Edwards Bills. & Prom. Notes, 131, star paging; Union Trust Co. of N. Y. v. Whiton, 97 N. Y. 172. As the instrument in the case at bar is essentially identical, except as to the time of payment, with the one in DeLavallette v. Wendt, 75 N. Y. 579, there is no escape from the conclusion that the court below erred in excluding the evidence referred to.
Waiving the defect, however, and viewing the instrument sufficient for the purposes of a promissory note, it was nevertheless competent, as between the parties and their privies with notice, to show a failure of consideration, and this by parol evidence. 1 Rice Ev. 274 ; 2 id. 1137; Randolph Neg. Inst. § 565; Bookstaver v. Jayne, 60 N. Y. 146 ; Isaacs v. Jacobs, 15 Daly, 490; Homestead Bank v. Wood, 48 N. Y. St. Repr. 775; Juilliard v. Chaffee, 92 N. Y. 529, 535. That an instrument recites the receipt of a consideration at most, clothes it with the dual character of contract and receipt. As the latter it is but prima facie evidence of the fact and open to rebuttal by oral proof. Meyer v. Peck, 28 N. Y. 590 ; Abbe v. Eaton, 51 id. 410; Van Etten v. Newton, 15 Daly, 538, 543.
Other exceptions of gravity appear in the record, but as the one discussed requires reversal we refrain from specially noticing those remaining, as the alleged error thereby presented may not again occur.
Judgment and order reversed and new trial ordered, with the costs of this appeal to the appellant to abide the event.