Summary
In Richardson Press v. Albright (224 N.Y. 497) suit was brought on a balance of approximately $4,000 alleged to be due for materials furnished to Oceanic Publishing Company. It was alleged that the defendant Albright, who was a large stockholder in that company, made certain promises.
Summary of this case from Bulkley v. ShawOpinion
Argued October 31, 1918
Decided November 19, 1918
George T. Hogg for appellant. Charles Thaddeus Terry for respondent.
Plaintiff declares on a balance of about four thousand dollars alleged to be due on account for materials furnished to Oceanic Publishing Company, a corporation, for which it is alleged that defendant agreed to pay. The complaint was dismissed at the close of plaintiff's evidence and the question is whether sufficient evidence was adduced to establish prima facie defendant's liability as a primary principal debtor.
Defendant was a large stockholder in Oceanic Publishing Company, which was publishing a semi-monthly periodical entitled "Dogs in America" which plaintiff was printing for it. On February 29, 1912, plaintiff brought to the attention of defendant by letter the fact that it had been carrying a large account with his company which was past due and asked him to make some arrangement for the systematic payment of it. On March 1 defendant answered, explaining that he had nothing to do with the direct management of the company; that the president, Vandergrift, conducted the business; that he expected that Vandergrift would soon resign and allow him to assume the management of the paper and that he would be glad to meet the representative of plaintiff to make arrangements for the payment of the back account due it and for future issues. This letter contains no promise to pay plaintiff the debt of Oceanic Publishing Company, but it contains a personal assurance that defendant will furnish Oceanic Publishing Company money to pay for each future issue.
The parties met on March 4, and Aberle, plaintiff's representative, testifies as follows:
"I met Mr. Albright on that morning, and Mr. Albright stated to me in substance — at least he said directly, `I am now in charge of the Oceanic Publishing Company. I will run it hereafter, Mr. Vandergrift has withdrawn.' He inquired about the size of the account and I had a statement with me, which I showed him. The exact figure I haven't here now. It was something like $3,000. We discussed the thing generally, and he said, `Well, you can't expect me to pay all of this.' He says, `I will agreed to pay you $1,500, in three payments, $500 weekly. I will further agree to pay each issue hereafter in cash, before you send it out.' This I want to say because we had notified the publishing company that we would not publish hereafter unless the cash was in evidence. That was really in answer to our request. Mr. Davidson, the treasurer of the company, was then present in the office. I asked Mr. Albright to give me this in writing, and he said, `No, I am an honorable man, my word is my bond. Besides, you have Davidson here as a witness.'" It later appeared that the money was to be forwarded by defendant to Mr. Davidson, the treasurer of the Oceanic Company.
No other promise, original or collateral, was ever made by defendant to plaintiff to pay the debt of Oceanic Publishing Company, and if the promise is to answer for its debt, it is unenforcible, because no note or memorandum in writing was made, sufficient to satisfy the requirements of the Statute of Frauds.
Assuming that defendant in the interview above quoted was speaking for himself and not merely as the representative of his company, it may be said that some of the elements of an original, enforcible, absolute promise on his part to pay $1,500 of the back indebtedness and to pay for future issues unquestionably appear. Technically, at least, defendant had a substantial interest to subserve in making the promise. He had — or at least he said that he had — taken control of Oceanic Publishing Company, and was about to reorganize it. It was his desire to have the plaintiff continue to issue "Dogs in America" and perhaps it was a benefit to him to have the periodical appear regularly without a change of publishers. Thus the element of a new consideration moving to him was present. But his beneficial interest was at best remote. Unquestionably the principal debt was not extinguished and credit was still given and to be given to Oceanic Publishing Company.
On this evidence it is urged that defendant became a primary debtor with Oceanic Publishing Company ( White v. Rintoul, 108 N.Y. 222; First N. Bank v. Chalmers, 144 N.Y. 432; Schwoerer Sons, Inc., v. Stone, 130 App. Div. 796; affd., 200 N.Y. 560; R. L. Co. v. Metz, 165 App. Div. 533, 537, 538; affd., 215 N.Y. 695), and that plaintiff was entitled to recover.
But a promise may still be collateral, even though the new consideration moves to the promisor and is beneficial to him. The elements of beneficial interest and new consideration must be present to take the case out of the statute, but the inquiry remains whether the consideration is such that the promisor thereby comes under an independent duty of payment, irrespective of the liability of the principal debtor. ( White v. Rintoul, supra, at page 227.) The implied consideration, as indicated by the subsequent dealings of the parties, is that plaintiff will continue to give credit primarily to Oceanic Publishing Company. Plaintiff was notified on March 14, 1912, that defendant admitted no responsibility as to its claim, and it is indisputable that plaintiff thereafter considered that the primary duty of payment remained with the original debtor. It continued to furnish materials and render services to Oceanic Publishing Company, publishing its periodical down to the issue of September 19; it kept no account with defendant on its books; made but one demand on him to furnish money in advance of an issue of the periodical, and that was for the issue of March 7, which brought forth the denial of responsibility; took assignments of accounts from Oceanic Publishing Company; took assignments of stock under an agreement which gave it control of Oceanic Publishing Company; took possession of all its personal property, books and papers, and turned to defendant only when the resources of the original debtor had been completely exhausted. The tenor of the entire transaction was that defendant purposed to help out the Oceanic Company and verbally promised to pay its debts.
When the primary debt continues to exist, the promise of another to pay the debt may be original or it may not be, but it is regarded as original only when the party sought to be charged clearly becomes, within the intention of the parties, a principal debtor primarily liable. If we pick a few phrases from the context, we may draw the conclusion that defendant intended to assume such a relation to plaintiff, but on all the evidence we find but one principal primary debtor and that is Oceanic Publishing Company. The ancient purpose of the Statute of Frauds was to require satisfactory evidence of a promise to answer for the debt of another person and its efficacy should not be wasted by unsubstantial verbal distinctions.
The judgment should be affirmed, with costs.
HISCOCK, Ch. J., CHASE, COLLIN, CUDDEBACK, CARDOZO and ANDREWS, JJ., concur.
Judgment affirmed.