Court Opinion

ID: 3527578
Source: CourtListenerOpinion
Date Created: 2016-07-05 22:40:07.49704+00
Date Added: 2024-06-11T13:25:55.326930
License: Public Domain

* Corpus Juris-Cyc. References: Bills and Notes, 8CJ, p. 203, n. 60; p. 206, n. 11; p. 497, n. 92; Evidence, 22CJ, p. 1153, n. 9; p. 1223, n. 21; p. 1255, n. 53.
This action on a promissory note was commenced in Taney county. The venue was changed to Webster county where a jury trial resulted in a finding and judgment for defendant. Unsuccessful in motion for a new trial plaintiff appealed.
The petition is in the usual form. The answer pleads fraud, failure of consideration, nondelivery, and denied that plaintiff was a holder in due course. A reply put in issue the new matter set out in the answer.
The note sued on was dated February 3, 1921, due in six months, and was for $500, made payable "to myself or order" and was signed and endorsed by the defendant. The consideration for the note was stock in the Industrial Transportation Company, a chain store concern, which became bankrupt a short time after the note was given. Plaintiff contends that it purchased the note from the agent of the transportation company in due course. The note was signed and endorsed by defendant at a place near plaintiff bank. Immediately thereafter defendant and Frank Mills, the agent and representative of the transportation company, went to the bank and defendant explained to C.W. Moore, president of the bank, that unless a store was established at Hollister by the transportation company by April 1, 1921, and defendant's son-in-law, Vernon M. James, made manager thereof, the note was to be returned to defendant. Such was the agreement, according to defendant, between him and Mills, the agent of the transportation company. And, according to defendant, the note was not delivered and was not to be delivered, but was to remain in the bank in the nature of an escrow pending the establishment of the store and naming the son-in-law, James, as manager. James, the son-in-law, had also purchased stock in the transportation company and had given his note for $250 due in six months.
Plaintiff bank's evidence is that without knowledge of the alleged escrow agreement it purchased the note sued on and the James note and in payment issued its time certificate to the transportation company for $750 due in six months, but there was a notation on the margin of the certificate giving plaintiff bank the option to extend it three months. The transportation company rejected the certificate because of the extension notation and it was returned to Mills who took it to the bank and it was cancelled and another certificate due in nine months and of the same amount was issued to Scott  Alessi, other agents of the transportation company. The evidence of plaintiff tends to show that defendant was informed that the first certificate was refused and that he agreed that the second certificate should issue, and that he would take his chances of getting his stock through Scott  Alessi. Defendant denied such agreement, and denied knowing anything about a time certificate being issued to Scott  Alessi until after the transportation company was in bankruptcy. Scott  Alessi transferred the certificate issued to them to *Page 1281 
the Hollister Banking Company of Springfield, Missouri, and it was paid at maturity by plaintiff.
The cause was submitted under an instruction given by the court of its own motion and we think that such instruction fairly submitted the issues. Plaintiff contends that an oral contemporaneous agreement cannot be interposed to defeat recovery on a promissory note and cities, among other cases, Peoples Bank of Ava v. Rankin, 282 S.W. (Mo. App.) 91. That case grew out of transactions quite similar to those in the cause at bar and involved the same chain store concern as is here involved. The law respecting an oral contemporaneous agreement is as plaintiff here contends, but defendant here is not relying upon an oral contemporaneous agreement, but is relying upon the nondelivery of the note. If the note was not delivered to the transportation company nor to anyone for it, then no contemporaneous agreement is involved and cannot be involved. It is always competent to show nondelivery or conditional delivery as between the original parties, and as to those with actual notice. Earle v. Woodruff, 274 S.W. (Mo. App.) 107, and such does not encroach upon the rule against oral contemporaneous agreements. A note is not a binding contract until delivered for the purpose of giving effect thereto and until so delivered is incomplete and revocable. [Sec. 803, R.S. 1919.] According to defendant's evidence the note was not delivered in the legal sense, but was to be left in plaintiff bank until the store was put in at Hollister and James put in as manager of said store, and that plaintiff's president was so advised at the time the note was taken to the bank by Mills and defendant. If such are the facts, and the jury so found, then no subsequent arrangement or agreement between plaintiff bank and Mills without defendant's knowledge and consent could give plaintiff the status of a purchaser in due course.
Several assignments of error are made, but it is not necessary to make separate disposition. There is no error which would justify a reversal. If defendant's evidence gives the correct version there is only one conclusion possible and that is the conclusion reached below. The judgment should be affirmed and it is so ordered. Cox, P.J., and Bailey, J., concur.