Jones v. Darling , 94 Ga. App. 641 ( 1956 )

Nichols, J.

The record shows that the defendants filed general demurrers to the plaintiffs’ petition in which it was alleged that the petition, “does not as a whole, nor do any of its several paragraphs or parts show a cause of action against said defendants,” and that, “said petition shows upon its face that the instrument sued upon is a wagering contract and is therefore illegal and void.” These demurrers were overruled and no exception was taken to such judgment by the defendants. Therefore, it became the law of the case that the plaintiffs’ petition set forth a cause of action against the defendants. Loughridge v. City of Dalton, 166 Ga. 323 (143 S. E. 393); Ogletree v. Stanley, 43 Ga. App. 253 (158 S. E. 465). However, such a ruling does not entitle the plaintiffs to all the relief sought as a matter of law.

The only evidence presented on the trial of the case was presented by the plaintiffs, and, before the defendants presented any evidence, the court directed a verdict for the plaintiffs in an amount equal to the interest due on the note from the date it was executed until the date of the payee’s death. Although a verdict could not be directed for either party at the close of the plaintiff’s evidence (Spivey v. Barwick, 157 Ga. 853 (1), 122 S. E. 594), an examination of the record in this case reveals that the plaintiffs have received a verdict for the full amount to which they are entitled under the pleadings and evidence, because under the terms of the note the plaintiffs were entitled only to the interest which became due on the note between the time it was executed and the time of the payee’s death and were not entitled to the principal amount of the note which became canceled upon the payee’s death. The interest became due semi-annually and was due and payable while the principal amount of the note was never due and payable under its own terms. Therefore the error in directing the verdict for the plaintiffs at the close of their evidence was harmless as concerns them, as were any other errors alleged to have occurred on the trial of the case. Hall v. State, 202 Ga. 619, 620 (44 S. E. 2d 234); Childers v. Ackerman Constr. Co., 211 Ga. 350, 356 (86 S. E. 2d 227).

Moreover, the clause in the note, “in case of her death . . . the note becomes canceled and the obligation of the maker ceases,” is not ambiguous and the note could be enforced by the payee at any time after its maturity if the payee was still in life, and while death is certain, the time of death is not certain.

The contract is not a negotiable instrument because it does not contain an “unconditional promise to pay” (Code § 14-201 (2)), but on the contrary says in effect: “I am legally obligated to pay this obligation at maturity to you and you alone; if you are dead I am released from the contract.” It is, accordingly, an unconditional contract in writing to pay the payee, and a release by the payee of the indebtedness to the maker insofar as her estate is concerned. A note and covenant not to sue thereon amounting to a release may be executed contemporaneously, and the effect of the release will be to bar collection of the note. Martin v. Monroe, 107 Ga. 330 (33 S. E. 62); Arnold v. Johnston, 84 Ga. App. 138 (65 S. E. 2d 707). This being a release pro tanto, its effect is to bar collection pro tanto—that is, to bar collection under the conditions set forth in the condition annexed to the contract. “A release which states that it shall take effect on the occurrence of a condition precedent is operative as a discharge on the occurrence of the condition.” Restatement of the Law, Contracts, p. 761, § 404 (1).

If a defeasance clause in a deed that the property shall revert to the grantor on the happening of a condition subsequent is not a wagering contract, by parity of reasoning the forgiveness of an indebtedness upon the happening of a condition subsequent should be given the same effect. Accordingly, the contract was not a wagering contract, and the judgment of the trial court denying the plaintiffs’ amended motion for new trial must be affirmed.

Judgment affirmed.

Gardner, P. J., Townsend, Carlisle and Quillian, JJ., concur. Felton, C. J., dissents.