Wheelock v. Berkeley

Mr. Justice Scholfield

delivered the opinion of the Court

This is assumpsit, by appellant, against appellee, on two-promissory notes. The defense is, failure of consideration,, in that these notes were given in renewal of prior notes given by and to the same parties for the warranty of the soundness- and speed of a horse, which warranty was broken, and appelleewas thereby damaged more than the amount now due upon; the notes.

The questions arising upon rulings of the lower court discussed in the arguments before us, are: First, is the giving; • and acceptance of a subsequent note in lieu of a prior note, which is taken up and cancelled, a waiver of the defense that, the consideration of the prior note was a warranty which has-been broken, it being known at the time by the party giving' the subsequent note that the warranty had been broken; and1 ' second, if not, should the amount of damages resulting from, the breach of the warranty be reduced by the amount which the maker of the note has realized from the warranted horse.. Both questions must be answered in the negative.

First—The giving of a note, unexplained, is not conclusive evidence of a settlement of all the demands between the parties to such an instrument, but the question of the intent of the parties, in such case, is one of fact, to be determined by the jury from all the evidence relating to the transaction.. Ankeny v. Pierce, Breese, (Beecher’s ed.) 289 ; Crabtree v. Rowand, 33 Ill. 421. And so, also, whether a subsequent note is given in payment of or only in renewal of a prior note, is not a question of law, but one of fact, to be determined by the jury; and when it is given in renewal only of a prior note, the real consideration for which it is given is that for which the prior note was given, and it is, in a suit upon the subsequent note, competent to show that that consideration has failed. (House v. Davis, 60 Ill. 367; 1 Parsons on Bills and Notes, pp. 176, 177, and notes; Tiedeman on Com. Paper, sec. 180.) In Crabtree v. Crawford, 25 Ill. 248, and Wickenkamp v. Wickenkamp, 77 id. 92, the discussion is one of fact only, and it was not intended to lay down any rule of law contrary to what is here asserted.

It is competent to interpose a breach of the warranty in consideration of which the note was given, as a defense to a suit upon the note. (Welch v. Hoyt, 24 Ill. 117.) And we held in the recent case of Underwood v. Wolf, 131 Ill. 425, that the mere fact that a party retains possession of property after a known breach of warranty, while it may bar him from a rescission of the contract, will not constitute an abandonment of his remedy by cross-action or by a counter-claim in the vendor’s action for the price.

Second—The measure of damages for a breach of warranty is the difference between the value of the property as warranted and its actual value at the date of the breach. (McClure v. Williams, 65 Ill. 390; 2 Sutherland on Damages, p. 425, et seq.) It is therefore of no consequence what the purchaser may have realized from the property.

The judgment is affirmed.

Judgment affirmed.