Summary
In F.I. Somers Sons, Inc. v. R.A. Le Clerc, 110 Vt. 408, 8 A.2d 663, 124 A.L.R. 1497, where a daughter promised to pay her mother's indebtedness, it was held that, in view of the relationship of the parties, their living together, the mother's inability to pay, and the length of time that elapsed, the jury could have rightfully inferred that the daughter's assumption of her mother's debt was either authorized or subsequently ratified by her mother.
Summary of this case from Greenwood Leflore Hosp. v. TurnerOpinion
Opinion filed October 3, 1939.
1. Evidence Contradicted on Cross-Examination — 2. Credibility and Weight for Jury — 3. Effect of Payment by Third Person — 4. Such Payment Strictly Accord and Satisfaction — 5. Inference as to Authority or Ratification — 6. Inference Held Justified — 7. Whether Original Debt Discharged on Assumption by Debtor's Daughter Held for Jury — 8. Findings Making out a Novation — 9. Discharge as Consideration for New Promise, Not Within Statute of Frauds — 10. Novation Never Presumed But Intention to Effect Found from Circumstances.
1. Where the evidence which a witness gave on cross-examination contradicted his direct testimony somewhat, it was for the jury to say which of the contradictory statements they would accept.
2. The credibility of a witness and the weight to be given his testimony are matters for the jury.
3. A payment made by one who is not a party to the contract and not even in privity with the debtor, if accepted in satisfaction of the debt, discharges the debt and is a valid defense to an action thereon.
4. Even though a third person pays in money the exact amount of the debt there can in strictness be at most an accord and satisfaction, for as payment by the third person is a different thing from payment by the debtor, the obligation has not been performed according to its tenor.
5. Where one man is indebted to another and a third person steps in and pays the debt, in the absence of all circumstances tending to show the contrary, the rational inference would be that the act done, being for the debtor's benefit, was done with his consent, or if without his knowledge at the time, that it would, as a matter of course, be ratified by him afterward.
6. The jury could have inferred in an action against a daughter to recover on an account originally charged against her mother, in the absence of any showing to the contrary, that the defendant's claimed assumption of the debt was either authorized or subsequently ratified by her mother, particularly in view of the relationship of the parties, their living together, the mother's inability to pay and the long term that elapsed before suit was brought.
7. Whether the plaintiff in action of contract discharged an account against the defendant's mother, which was conceded to have been valid, upon the defendant's promise to assume it, was a jury question when the plaintiff's manager, though he contradicted his testimony somewhat on cross-examination, testified the plaintiff told him that her mother could not pay the account, that she would assume it and make small monthly payments, that she was going to look after her mother's property and affairs, and that they would pay in full if they sold the property for enough to pay what they owed, and there was evidence that the defendant and her mother lived together and that the account was transferred into the defendant's name at the time the defendant made the statements referred to.
8. If the jury were to find in an action against a daughter for a debt originally contracted by her mother that the defendant's assumption of the debt was either authorized or subsequently ratified by her mother, and that the plaintiff discharged the debt against the mother upon the defendant's promise to assume it, such findings would make out a novation between the three parties, the creditor, his immediate debtor, and the intended new debtor, by which the liability of the new debtor was accepted in discharge of the original debt.
9. The discharge of an original debt is a sufficient consideration for a new promise by another to pay it, and the new promise is not within the Statute of Frauds requiring a special promise to answer for the debt of another to be in writing, but is an independent contract and provable as such.
10. A novation is never presumed, but there must be a clear and definite intention on the part of all concerned that such is the purpose of the agreement, although the existence of such an intention may be found from the circumstances even when there is nothing positive in the agreement.
ACTION OF CONTRACT on indebtedness originally incurred by the defendant's mother and alleged to have been assumed by the defendant. Plea, the general issue. Trial by jury in Montpelier municipal court, A.C. Theriault, Municipal Judge, presiding. At the close of the plaintiff's case defendant's motion for a directed verdict was granted. The plaintiff excepted. The opinion states the case. Reversed and remanded.
George R. McKee for the plaintiff.
Robert H. Ryan for the defendant.
Present: MOULTON, C.J., SHERBURNE, BUTTLES, STURTEVANT and JEFFORDS, JJ.
This is an action of contract in which it is alleged that in consideration of the discharge of an indebtedness due from the defendant's mother the defendant promised to pay it out of the rents and profits of her mother's real estate and out of the proceeds from its sale. The case comes here upon exceptions to the direction of a verdict in favor of the defendant.
It was conceded that the plaintiff had a valid account against the defendant's mother, and, viewing the evidence most favorably to the plaintiff, it appeared that on February 12, 1934, the defendant came to the plaintiff's store and had a talk with Fred I. Somers, plaintiff's general manager, in which she said that her mother could not pay the account, and he said that he wished some one to assume responsibility, whereupon she said that she would assume the account in her name and make small monthly payments, and stated that she was going to look after her mother's property and affairs, that they hoped they could sell the property for enough to clean up their accounts, and that they would pay in full if they sold for enough to pay what they owed. At this time she paid ten dollars on account, and he directed the bookkeeper to transfer the account into defendant's name and to send future statements to her. The defendant and her mother had the same names and resided at the same address. The bookkeeper immediately made the change upon plaintiff's books by substituting the word "Miss" for "Mrs." Subsequently monthly statements were sent to the defendant, but the bookkeeper was not sure but that she might unconsciously have sent some statements to Mrs. R.A. LeClerc or to just R.A. LeClerc. Prior to the bringing of this suit the real estate had been sold for enough to pay all indebtedness, including plaintiff's account.
Fred I. Somers was the only witness to the conversation with the defendant. The evidence which he gave upon cross-examination contradicted his direct testimony somewhat, and it would have been possible for the jury to have found therefrom that the defendant did not assume her mother's account, but merely made a collateral promise. However, the credibility of the witness and the weight to be given his testimony were matters for the jury. It was for them to say which of the contradictory statements they would accept. Gomez v. Lawson, 105 Vt. 353, 357, 166 A. 14; McDonald v. McNeil, 92 Vt. 356, 361, 104 A. 337; Robey v. Boston Maine Railroad, 91 Vt. 386, 388, 100 A. 925; Pocket v. Almon, 90 Vt. 10, 14, 96 A. 421.
The nature of the evidence is such that an examination of the authorities should be made to determine whether the jury would have been justified in finding that the defendant's assumption of her mother's account with the plaintiff was either authorized, or subsequently ratified, by her mother. In Robinson v. St. Johnsbury L.C.R.R. Co., 80 Vt. 129, 66 A. 814, 9 L.R.A. (N.S.) 1249, 12 Ann. Cas 1060, there is a review of a number of English and American cases upon the question whether payment or satisfaction by a third person, not himself liable as a co-contractor or otherwise, is sufficient to discharge a debtor. In that case the payment was made on plaintiff's demand, in settlement of the cause of action, by one who was in fact an indemnitor of the defendant, and whose act the defendant could and did ratify by pleading it, and the Court expressly said that nothing discussed in the opinion should be taken as deciding more.
According to Williston on Contracts, § 1858, and Elliott on Contracts, § 1928, the weight of authority in the United States sustains the validity of a defense of a payment made by one who is not a party to the contract and not even in privity with the debtor, if accepted in satisfaction of the debt, and holds that such payment discharges the debt. However, even though the third person pays in money the exact amount of the debt there can in strictness be at most an accord and satisfaction, for, as payment by A is a different thing from payment by B, the obligation has not been performed according to its tenor. Among others, the following cases support this proposition: Gray v. Herman, 75 Wis. 453, 44 N.W. 248, 6 L.R.A. 691; Harrison v. Hicks, (Ala.) 1 Port. 423, 27 A.D. 638; Braun v. Cox, 202 Iowa, 1244, 211 N.W. 891; Beck v. Snyder, 167 Pa. St. 234, 31 A. 555; Clark v. Abbott, 53 Minn. 88, 55 N.W. 542, 39 A.S.R. 577; Crumlish's Admr. v. Central Improvement Co., 38 W. Va. 390, 18 S.E. 456, 23 L.R.A. 120, 45 A.S.R. 872; Leavitt v. Morrow, 6 Oh. St. 71, 67 A.D. 334. We quote from Gray v. Herman, supra: "The plaintiff's counsel says that the satisfaction of a debt by a stranger, between whom and the defendant there is no privity, is not available as a defense. But again we ask, why should it not be, if the creditor accepts the payment in satisfaction of the debt? If a debt is fully paid, it would seem according to plain common sense, that the obligation was extinguished, and is no longer in force as a contract. What concern is it to the creditor who pays his debt, especially where he accepts the payment in satisfaction of his debt?" We also quote from Harrison v. Hicks, supra, "The payment and discharge of a debt, no matter by whom effected, can be nothing more nor less than its extinguishment as a demand. As between the person who paid it, and him for whose benefit it was intended, a question may arise, whether it was purely voluntary or not, which would depend upon the circumstances of previous request, or of subsequent ratification, either express or implied." We concur in the validity of such a defense.
In Leavitt v. Morrow, supra, a case cited in Robinson v. St. Johnsbury L.C.R.R. Co., supra, occurs this sentence: "It may be laid down as incontestable, as a general thing, that where one man is indebted to another and a third person steps in and pays the debt, in the absence of all circumstances tending to show the contrary, the rational inference would be that the act done, being for the debtor's benefit, was done with his consent, or, if without his knowledge at the time, that it would, as a matter of course, be ratified by him afterward." For the purposes of this case it is unnecessary to go as far as § 421 of the Restatement of Contracts does where it provides: "A payment or other performance by a third person, accepted by a creditor as full or partial satisfaction of his claim, discharges the debtor's duty in accordance with the terms on which the third party offered it. But the debtor on learning of the payment or other performance has power by disclaimer within a reasonable time to make the payment or other performance inoperative as a discharge." But we do hold, particularly in view of the relationship of the parties, their living together, the mother's inability to pay, and the long time that has elapsed, that, in the absence of any showing to the contrary, the jury could have rightfully inferred that the defendant's assumption of her mother's debt was either authorized or subsequently ratified by her mother. Hence the jury could have found that the plaintiff discharged the account against the mother upon the defendant's promise to assume it. The validity of the account having been conceded, such findings would have made out a novation by substitution of a new debtor, which requires a mutual agreement between the three parties, the creditor, his immediate debtor, and the intended new debtor, by which the liability of the last named is accepted in discharge of the original debt. Peters v. Est. of Poro, 96 Vt. 95, 107, 117 A. 244, 25 A.L.R. 615; Manley Bros. Co. v. Somers, 100 Vt. 292, 297, 137 A. 336. The former case and the cases cited therein show that the discharge of the original debt is a sufficient consideration for the new promise, and that the new promise is not within the Statute of Frauds requiring a special promise to answer for the debt of another to be in writing, but is an independent contract and provable as such. Both cases hold that a novation is never presumed, but that there must be a clear and definite intention on the part of all concerned that such is the purpose of the agreement, and that the existence of such an intention may be found, although there is nothing positive in the agreement, it being a question to be decided from all the circumstances. Such an intention could have been found by the jury.
Judgment reversed and cause remanded.