Cowan v. Hallack , 9 Colo. 572 ( 1886 )

Elbert, J.

Hallack’s account with Garvey, upon which the undertaking sued upon appears to have been indorsed, is an ordinary itemized statement by a merchant of his account with a debtor. The language of the undertaking so indorsed is as follows:

“ I hereby accept this bill, in compliance with the terms of contract and specification with Mr. H. A. Garvey, payable to E. F. Hallack thirty days after July 9, 1881.

[Signed] “E. E. Cowan.”

The defense admitted the signature, and that no payment had been made. Aside from this, the undertaking was all the evidence introduced on the trial in the court below, and upon it the plaintiff recovered judgment. Two points are made by counsel: (1) That no consideration was alleged or proved; and that, therefore, the court erred in overruling the defendant’s motion for a non-suit; (2) that the court ei’red in sustaining the demurrer to the third defense.

It is well understood that in an action upon a simple contract, the plaintiff, in order to recover, must allege and prove a consideration. In this connection, however, it is to he remembered — First, that the admission of a consideration by the terms of the written contract is prima facie evidence of its existence, and satisfies the rule; second, that negotiable instruments import aconside ration, and are exceptions to the rule. 1 Pars. Cont. 430; Daniel, Neg. Inst. § 161; Whitney v. Stearns, 16 Me. 394. We do not think that the instrument sued upon contains, by its terms, an admission of such a consideration as in itself relieved the plaintiff from the necessity of making proof of a consideration. It admits a contract with Garvey to accept, but it does not disclose any consideration for such a contract, and we are not at liberty to presume its existence. It would be illogical to treat that as a consideration which itself depends for its value and validity upon the existence of a consideration. Whether the writing imports a consideration is a more difficult question, and depends upon whether it is negotiable under the provisions of the statute concerning bonds, bills and promissory notes. Ch. 9, Gen. St. 142. Section 3 of the act provides that “all promissory notes, bonds, due-hills, and other instruments in writing, made by any person, whereby such person promises or agrees to pay any sum of money or article of personal property, or any sum of money in personal property, or acknowledges any sum of money or article of personal property to be due to any other person or persons, shall he taken to be due and payable to the person or persons to whom the said note, bond, bill, or other instrument in writing is made.” Section 4 provides that “any such note, bill, bond, or other instrument in writing, made payable to any person or persons, shall be assignable by indorsement thereon, under the hand of such person and of his assignee, in the same manner as bills of exchange are, so as absolutely to transfer and vest the property thereof in each and every assignee successively.”

Under this statute all promissory .notes and instruments in writing for the payment of money are negotiable, whether so expressed or not. And whether the particular instrument contains the words “ or order,” or equivalent words, or not, its legal effect is the same as if it did ■contain such words. Thackaray v. Hanson, 1 Colo. 366; Roosa v. Crist, Ill. 450; Archer v. Claflin, 31 Ill. 306. To constitute a good promissory note, no precise words of contract are necessary, provided they amount, in legal effect, to a promise to pay. In other words, if over and above the mere acknowledgment of the debt there may be collected from the words used a promise to pay it, the instrument may be regarded as a promissory note. 1 Daniel, Neg. Inst. § 36 et seq.; Byles, Bills, 10, 11, and cases cited. See, also, the following decisions under statutory provisions similar to our own: Bilderback v. Burlingame, 27 Ill. 338; Archer v. Claflin, 31 Ill. 306; Jacquin v. Warren, 40 Ill. 459; White v. Smith, 77 Ill. 351; Petillon v. Lorden, 86 Ill. 361; Stacker v. Watson, 1 Scam. 207; Smith v. Bridges, Breese, 18; Williams v. Forbes, 47 Ill. 148; Sappington v. Pulliam, 3 Scam. 385; Roosa v. Crist, 17 Ill. 450; Wilder v. De Wolf, 24 Ill. 190.

“Due A. B. $325, payable on demand,” or, “I acknowledge myself to be indebted to A. in $109, to be paid on demand for value received,” or, “I. O. U. $85 to be paid May 5th,” are held to be promissory notes, significance being given to words of payment as indicating a promise to pay. 1 Daniel, Neg. Inst. § 39, and cases cited.

Hallack’s itemized account with Garvey, upon which the undertaking of the defendant is indorsed, is in no sense negotiable paper. The indorsement thereon, however, signed by the defendant, is a new undertaking; and if, under our statutes, it is negotiable, it imports a consideration. Bay v. Freazer, 1 Bay, 72. The word “ accepted ” on a bill of exchange is an engagement to pay the bill in inoney when due. Indorsed upon nonnegotiable paper, as in this case, there is authority for saying that it would not import a consideration as in the case of such indorsement upon negotiable paper, and a consideration would have to be alleged and proved. Byles, Bills, 3, note; Jeffries v. Hager, 18 Mo. 272; Richardson v. Carpenter, 2 Sweeny, 366. The language of the undertaking, however, must be considered as a whole, and in this case we think it clearly imports a promise upon the part of the defendant Cowan to pay Hallack, the payee, the amount of the bill upon which it is indorsed, at the time specified. 1 Daniel, Neg. Inst. § 36 et seq., and cases cited.

We think the writing comes clearly within the provisions of the statute which we have quoted; that is to say, it is “an instrument in writing” made by the defendant Cowan, whereby he promises to pay in money, at a specified date absolute, the amount of the bill upon which the undertaking is indorsed'. As such it is a negotiable instrument, and imports a consideration. Our statute in this respect is substantially the statute of 3 and 4 Anne, chapter 9 (1 Daniel, Neg. Inst. § 5, note; id. § 162), the effect of which was, in an action upon a promissory note, to dispense with the necessity of either alleging or proving a consideration. Peasley v. Boatwright, 2 Leigh, 198. In this view, the plaintiff was entitled to recover on the evidence introduced, and the defendant’s motion for a nonsuit was properly overruled.

It is claimed that the court erred in sustaining the demurrer to the third defense. The language of the writing sued upon is in some respects unusual; but we see no serious difficulty in declaring its meaning. While the word “specification” is of no special use in the sentence where it occurs, it is harmless. The contract is complete without it, and its import is the sainé with it. It does not appear to have been used to qualify or modify the undertaking, but to amplify by repetition, and is to be treated as tautology. The acceptance .being unconditional, it was not competent for the defendant to show that it was upon condition. If it was in fact conditional, and, as the defendant alleges, dependent upon the contingency of Garvey’s complying with the terms of his contract with the defendant, it should have been so written. It follows that the third defense is bad. It .proposes to contradict and vary the terms of an express contract. The demurrer to it was properly sustained.

The judgment of the court below must be affirmed.

Affirmed.