Court Opinion

ID: 5460840
Source: CourtListenerOpinion
Date Created: 2022-01-09 19:35:52.920181+00
Date Added: 2024-06-11T08:32:50.034372
License: Public Domain

By the Oourt,

James 0. Smith, J.
It is a salutary and invariable rule of courts of equity, that in an action to reform a written agreement, on account of an alleged mistake of facts, relief will not be granted except upon the clearest and most satisfactory proof of the mistake- and of the real agreement between the parties. (1 Story’s Eq. Jur. § 152.) This is upon the ground that the written paper ought to be *454treated as a full and correct expression of the intent of the parties, until the contrary is established beyond reasonable controversy. (Id. 2 John. Ch. 285. Id. 630.)
Keeping this rule in view, it is difficult to sustain the judgment in the case before us, upon the findings of the referee. The judgment is, that the two promissory notes executed by the defendants to the plaintiff, for one thousand dollars each, dated June 5, 1862, payable in three and four years from date, respectively, be reformed by inserting in each of them the words, “ with interest,” so that each shall draw interest from date. The referee has not found either that it was agreed orally, by the parties, that the notes referred to should bear interest from their date, or that they were by mistake executed, delivered and accepted, containing no words to that effect. The fact is established by the report of the referee, that a paroi agreement had been made between the parties, prior to the date of the notes, for the sale of certain personal property; but his only finding is that two certain papers annexed to his report, of even date with the notes, state truly and correctly the agreement between the parties. The first of the papers referred to is an instrument of sale of personal property by the plaintiff to the defendants, in consideration of the sum of $6000, the payment of which is thereby acknowledged; and the second paper is a chattel mortgage, executed by the defendants to the plaintiff upon property of the same description as that contained in the: instrument of sale, and which probably was the same prqpBrtyj -'conditioned for the payment of four several promissory notes of the same date, for $1000 each, executed by the ^f#^^lk\to the plaintiff, payable in one, two, three and lour yeap respectively, which notes, as the referee finds, were texpdufed’ afifi. delivered at the same time with the instrument of sak^Eiiíd the chattel mortgage, and “as a part and portion : óf the same transaction,” and the last two of which are the notes which the plaintiff seeks to reform. It appears by the opinion of the referee, that in coming to the conclusion that *455the two papers referred to,.state correctly the agreement of the parties, and that the last two notes should be corrected, he relied upon the affirmative provisions of the chattel mortgage and of the first two notes, on the subject of interest, and not upon any oral evidence. Indeed, he avers in his opinion, that upon the oral evidence in the case, the plaintiff must fail. The question, therefore, is whether the papers referred to, to wit, the instrument of sale, the chattel mortgage, and the first two notes, regarded merely as evidence of the 'terms of the prior paroi agreement of the parties, and unaided by any oral evidence, show clearly and satisfactorily, upon their face, that the last two notes, executed at the same time, and as parts of the same transaction, were, by the terms of such paroi agreement, to bear interest from their date.
I am of opinion that they do not furnish any satisfactory evidence of the fact alleged ; much less do they present that clear and strong proof which is requisite; and that to hold otherwise would be to establish a very dangerous precedent. There is, certainly, nothing in the instrument of sale, or in the first two notes, amounting to even slight proof of a prior paroi agreement that the last two notes should draw interest. In respect to the chattel mortgage, whatever interpretation should be given to it as a contract, it does not contain an expression which proves clearly and satisfactorily that each of the four notes was to bear interest from its date; or, in other words, but that the mortgage was intended as a collateral security for the notes in the very terms in which they now appear. The fact that two of them bear interest from their date, gives full effect to every clause of the mortgage. -It appears by the case that the mortgage was partly, written and partly printed. All the words which can be construed-, to intend the payment of interest on the notes are printed, while the mortgage contains a written description of the notes, stating their amounts and the times when payable, respectively, but which is silent in-respect to interest. In these circumstances, as the mortgage is merely collateral to the notes, *456it can not properly be considered as evidence of an agreement to pay interest on the notes, except according to their terms. Even if the question before us involved the true construction to be given to the mortgage as a contract, I am not able to see why the considerations above suggested would not be pertinent and controlling.
[Mokboe Gekebai, Teem,
June 6, 1864.
But if we reject the views above presented, and assume that the language of the mortgage, in respect to interest, is inconsistent and irreconcilable with the terms of the notes, we have advanced but a short distance in the investigation of the case. In which of the instruments is the paroi agreement truly expressed—the notes or the mortgage ?—the principal obligation or the collateral security? Eo answer to this question can be had from the face of the papers.
Again; there is no evidence or finding of fraud on the part of the defendants, or of a mutual mistake; and without one or the other of these elements, no case is made for reforming the written contract.
It is suggested by the respondents’ counsel, that even if there be no proof of fraud or mistake, the plaintiff is entitled to a decree for a specific performance. But if the views above presented as to the evidence of the terms of the paroi agreement are correct, it is obvious that the plaintiff is not entitled to such decree, since he has not shown an agreement that the last two notes should bear interest.
The judgment should be reversed, and a new trial ordered; "costs to abide the event.
Ordered accordingly.
J. O. Smith, Welles, and & Darwin Smith, Justices.]