Court Opinion

ID: 8192104
Source: CourtListenerOpinion
Date Created: 2022-09-09 23:15:12.414067+00
Date Added: 2024-06-11T16:40:38.626698
License: Public Domain

The following opinion was filed April 11, 1916 :
MaRshall, J.
The first proposition submitted on behalf of appellants which, in an orderly treatment of the case, it seems should be considered, is that questions 1 and 2 of the special verdict should not have been submitted and the findings in respect thereto should not be deemed material, because it is not competent to vary a written contract by parol evidence of what occurred between the parties prior to or contemporaneous with its making, and the law in that respect applies to the contract relations between the payee of a note and one who places his name thereon, in form, as an indorser, no fraud being practiced in securing the indorsement. Such proposition is ruled in appellants’ favor by Charles v. Denis, 42 Wis. 56; Davy v. Kelley, 66 Wis. 452, 29 N. W. 232; Halbach v. Trester, 102 Wis. 530, 78 N. W. 759; Hackley Nat. Bank v. Barry, 139 Wis. 96, 120 N. W. 275; and other cases decided by this court, all in harmony with a very elementary principle.
In Hackley Nat. Bank v. Barry, speaking of such principle, the court said:
“Our books are replete with statements and applications of that rule. ... It has b.een applied in many instances to preclude admission of evidence of what was said between parties to commercial paper, at the time of the making thereof, to vary its terms: as that it might be paid in bank notes . . . ; or that a party purporting to be bound as a payee or indorser should not be so bound ... ; or that the indorser placed his name on the note with the understanding that his indorsement *477should be without recourse . . . ; aud many more like instances.”
In Halbach v. Trester it was said, in effect, that the engagement which the law implies from the circumstances of a person placing his name on the back of a note, in form, as an in-dorser, is just as immune from danger of being varied by parol evidence as any other written contract. “There being no claim of fraud in securing the indorsement, the trial court properly rejected the testimony by which it was sought to' establish the fact that defendants did not intend to bind themselves as indorsers.”
No reason is perceived why the foregoing does not preclude' the findings of the jury that the agreement, pursuant to which the notes in suit were given, was that respondent should loan the money, therein promised to be paid, to appellants, from affording any efficient support to the judgment. There is no finding that any fraud was practiced upon them hy respondent to secure their indorsements, and no evidence which would tend to support any such finding. On the contrary, the evidence, quite strongly, affirmatively indicates that the contract, as indicated by the writing, is precisely the one appellants intended to make; but there is no need for discussing the matter so we will not extend the opinion hy referring in detail to the •evidence.
Paulson v. Boyd, 137 Wis. 241, 118 N. W. 841, and similar cases, to the effect that parol evidence is admissible to show that a note was delivered to take effect only upon some stipulated condition, and Breitengross v. Farr, 100 Wis. 215, 75 N. W. 893, to the effect that such evidence is competent in an action between persons liable on a note to show the contract relations between them in relation to the matter, are in harmony with the foregoing.
It is suggested that, as appellants placed their names on the back of the notes before delivery to give credit thereto, they are liable as makers, particularly Gether, who was not a party *478to the notes prior to his so writing his name. Such is the rule in some jurisdictions, as indicated in E. L. Welch Co. v. Gillett, 146 Wis. 61, 130 N. W. 879; but the weight of authority is to the contrary, and the decisions of this court are in harmony therewith. Davis v. Barron, 13 Wis. 227; King v. Ritchie, 18 Wis. 554; Frederick v. Winans, 51 Wis. 472, 8 N. W. 301; Blakeslee v. Hewett, 76 Wis. 341, 44 N. W. 1105.
The defense pleaded that the’notes were delivered to respondent conditionally, and that the conditions were never fulfilled, was negatived by the jury upon ample evidence to support the finding. So we turn to the matter covered by the 'second defense pleaded; i. e. that respondent, seasonably, had in its hands and under its control the means of complete or partial satisfaction of the notes, but applied the collateral to such notes and such means of satisfaction to other purposes than tlioir payment. Several interesting questions are discussed in the briefs of counsel relating to such second defense which are immaterial in view of the findings of the jury that, at the time appellants waived protest on the notes, and prior thereto, they promised to pay them; that with full knowledge of the delivery of the collateral to the $20,000 of notes and the disposition made of the other securities held by the bank for the indebtedness of the Heller Piano Company, and after the maturity of the notes, appellants promised to pay them; and that, with full knowledge of the relation of such collateral to the indebtedness represented by said notes, appellants advised and aided in the transfer of such collateral to the H. P.. Nelson Company. There is ample evidence to support such findings.
That'there was no consideration which moved to appellants for their promise to pay the notes is not material if such promise was made to induce respondent to look to them and not to the collateral or other means respondent might have for satisfaction, in whole or in part, of the indebtedness, and respondent acted thereon, which seems, clearly, to be the case, as the jury, in effect, found.
*479There was evidence that when the negotiations were on for .turning the collateral over to IT. P. Nelson, respondent ■wanted the entire liabilities of the Seller Piano Company ■taken out of the bank; that appellants participated in the negotiations and urged respondent to deal with Nelson and the collateral without reference to the notes in suit, Cether saying, — “Leave the Commercial Securities Company and my papers alone,” or words to that effect. “I will take care of ■them myself. All I want is time. I will pay that; that is my indebtedness” — and that, thereupon, the transaction for turning the collateral and some over $20,000 of the liabilities -of the piano company to Nelson was concluded. The jury in making the findings in question must have believed that evidence. Appellants, Nelson, and the piano company were very closely related in business. It was very important to appellants and Nelson to keep such company a going concern, •and the arrangement appellants promoted for taking the large .amount of piano company indebtedness out of the bank was thought to be vital thereto. It was necessary to such arrangement, as evidence tends to show, which the jury must have believed in coming to the conclusions which they did, that the bank should leave the indebtedness on the notes in ■suit- out of the transaction with Nelson, as a matter to be looked after by appellants. That was done and the business between the bank and the piano company, including the handling of the latter’s bank account, was thereafter conducted without reference to the particular indebtedness. It was left out of calculation, as to the piano company, on the theory, apparently, that appellants would care therefor according to the promise which entered into the transaction of releasing the collateral to Nelson. Consistent therewith, the piano company was accommodated by being permitted to do its ordinary business with the bank, undisturbed by the circumstance of the existence of the overdue notes. It deposited drafts for collection, from day to day, as occasion required, and drew against them to meet its necessities. During this time au*480thority was given to the bank by Heller to sell some real estate it beld for him and apply the proceeds on indebtedness of the piano company, other than the notes in suit. As to this particular matter, we do not overlook the form of the order as to the sale of the realty and disposition of the proceeds; but the undisputed evidence, as the court instructed the jury, is that the application of such proceeds was directed by Heller to be made upon particular indebtedness, or 'the understanding was that it should be so applied, and such was done. In short, from the time of the waiver of protest and assurances by appellants that they would take care of the particular indebtedness, the conduct of the bank is inconsistent with any other reasonable theory than that it relied on such assurances and, so relying, that it parted with collateral security for payment of such indebtedness and left the enforcement of the security specialty pledged for such payment to be looked after by appellants and omitted to exercise any right it had to resort therefor to the piano company’s bank account.
That the evidence shows that the bank relied on the assurances of appellants as stated, as the trial court viewed the matter, if the facts were as indicated in the third, fourth, and fifth findings made by the jury, is evident from the circumstances that the questions which resulted in such findings were submitted on the theory that they covered the essentials of an estoppel in pais against appellants efficiently putting forth the matters covered by the second defense pleaded, and no question was submitted in respect to such reliance. Counsel for appellants did not request the submission of any such question. Had one been submitted, there can be no reasonable doubt as to what the answer would have been. It would have been in favor of respondent as a natural result of the other findings and the evidence. In any event, it must be regarded as a verity that the court below decided such matter in favor of respondent under the statutory rule that all matters of fact essential to support a judgment rendered on a spe*481cial verdict, wbicb are controverted on tbe evidence, if omitted from sncb verdict and not brought to tbe attention of tbe court by request for findings, shall be deemed determined, by tbe court in conformity with its judgment, and consent shall be presumed that such omitted facts be determined by tbe court. Sec. 2858m> Stats.
It needs no discussion to demonstrate that tbe situation shown by tbe findings above referred to creates an estoppel in favor of respondent as 'to all tbe matters covered by appellants’ second defense and'precludes them from efficiently making any defense to their alleged liability upon tbe notes, wbicb they knew, or ought reasonably to have known, existed when they lulled respondent into tbe belief that they would not question such liability and so induced, or materially aided in inducing, it to take a course by wbicb it would be greatly prejudiced if they were permitted to successfully change their ‘ attitude.
If a person acts in bis business relations with another, under such circumstances as to charge him with knowledge, that such other may probably rely thereon to bis damage in case of such person’s conduct thereafter being inconsistent with bis former actions and such other does, in good faith, so rely, such person cannot so change bis position to such other’s prejudice. State ex rel. Att’y Gen. v. N. P. R. Co. 157 Wis. 73, 97, 147 N. W. 219.
Tbe doctrine of estoppel is of far-reaching character. While it has been spoken of by some writers with a measure of discredit, as this court remarked in Marling v. FitzGerald, 138 Wis. 93, 120 N. W. 388, “It is entitled to the distinction of being one of the greatest instrumentalities to promote the ends of justice which the equity of the law affords.” Where the facts call for its application in order to prevent injustice being done, it “has the field to itself” superseding all other rules which have not fully acted upon the particular situation. It absolutely precludes, both at law and in equity, a party *482“from asserting rights which might perhaps have otherwise existed, either of property, of contract, or of remedy,'as against another person, who has in good faith relied upon such conduct, and has been led thereby to change his position for the worse, and who on his part acquires some corresponding right, either of property, of contract, or of remedy.” 2 Pom. Eq. Jur. (3ded.) § 804.
We have examined all the features of the briefs of counsel for appellants respecting errors claimed in giving or failing to give instructions, in failing to submit to the jury questions requested, in the admission or rejection of evidence, and others, and it does not seem that this opinion should be extended by referring to them in detail and showing why we are persuaded that no such error in respect to any such matter was committed which probably affected the verdict of the jury as to the matters creating the estoppel upon which, it seems, the judgment is well grounded.
Under the established rule that, no matter how many errors may be committed in the course of a trial, they will not operate to disturb the judgment on appeal unless it appears, pretty clearly, that had they not occurred the result might probably have been more favorable to the party complaining, generally, there is little use in bringing to the attention of this court many detail matters in respect to the admission of evidence, where such matters must be considered in connection with a mass of evidence and many circumstances, in the light of the presumption that the trial was before a competent trial judge and an impartial and intelligent jury. Such a jury may be swayed by immaterial evidence or rather unfair conduct of counsel; but the fact in that regard must, pretty clearly, affirmatively appear from the record, or errors assigned as to such conduct, or mere irrelevant or immaterial evidence, or the rejection of evidence, else the fault, in case of there being any, must be regarded as nonprejudicial.
*483We may well give some special attention to tbe claim that judgment should have been awarded appellants because the jury found that Nelson’s agreement to pay $20,240.90 to the respondent and to take indebtedness of the piano company to that amount with the collateral thereto out of the bank, was in consideration of the latter’s agreement to discount notes of Nelson and his companies to the amount of $60,000, and that such discount was refused. It is considered that, — the jury having also found that the feature of the agreement as to the $60,000 was not to be effective until approved by the board of directors of the bank, and the evidence showing that such approval was to wait upon satisfaction by such board as to representations made by Nelson affecting the character of his paper; that the feature, as to payment of the $20,240.90 to, and taking piano company indebtedness to that amount out of, the bank, was closed up without waiting for action hy such board upon the $60,000 matter, and that the closed feature was not thereafter rescinded, — the court was warranted in holding that the result as to the $60,000 was immaterial to the other feature and the promise of appellants to take care of the notes in suit if the bank would deal therewith separate from the other indebtedness and surrender the security which was primarily liable therefor.
The suggestions that the evidence showed $52 to have been paid into the bank as collections on the collateral to the notes in suit after the action was commenced, and that two of the items of collateral were not produced at the trial, and that such matters should have been applied to reduce the liability of appellants, have not been overlooked. The evidence as to the $52 and the disposition thereof is not very clear. It rather seems that Gether had the benefit of it or that it was set aside for him and his cosurety. It also seems that the two contracts referred to were accounted for and not lost. In any event, those matters do not seem to have been brought to the *484attention of tbe trial court or that any question was raised in respect thereto by exceptions. On tbe whole, it is considered that there is no merit in such matters which can now justly work a disturbance of the judgment.
By the Court. — The judgment is affirmed, with costs in this court to the respondent.
A motion for a rehearing and for modification of the mandate was denied, with $25 costs, on June 13, 1916.