Levensaler v. Batchelder

The trial court ruled that in view of the established facts set forth above, the rights of the defendant Batchelder under the forty-four year old mortgage here involved were not barred by the statute of limitations, (P. L., c. 329, ss. 1, 5) and this ruling raises the only question of law disclosed by the record. The fact relied upon by the defendant to sustain this ruling is that in 1922 the plaintiff's testator inserted in the covenants of warranty contained in his deed to Annie D. Mullaley an exception which had reference to this mortgage.

The conventional statement of the rule in regard to new promises which is obviously invoked here, is that a direct and unqualified admission by a debtor within the statutory period prior to the commencement of the action, of a subsisting debt which he is liable and willing to pay, is sufficient evidence of a new promise which will prevent the statute from operating as a bar to a recovery of the debt. Barker v. Heath, 74 N.H. 270, 272; Engel v. Brown, 69 N.H. 183; Holt v. Gage, 60 N.H. 536. All the recent cases indicate clearly that it is the new promise which may be inferred from the admission and not the admission itself that takes the case out of the statute. Thus, in regard to a partial payment, this court has said, "It is not the part payment which takes the case out of the statute, but the new promise of which it may be evidence; therefore payment of a part is not enough unless it is made under such circumstances that a promise to pay the remainder may reasonably be inferred from it." Engel v. Brown, supra, 185. In other words, the conduct of the debtor must be such as to justify an inference that a new promise was made and the inference must actually be drawn by the trier of facts before the bar of the statute will be overcome.

Upon the question, to whom must a new promise be made, there is a conflict of authority. Some courts hold that a new promise, although made to a stranger, is sufficient to take the debt out of the operation of the statute, but the weight of authority is to the effect that the new promise must be made, not to a stranger, but to a person having some tangible connection with the transaction, e.g. "to the creditor himself or to some one acting for him, or in privity with him, or to a party in interest, or to be communicated to the creditor, or made with reason to know that it would be communicated to and influence the creditor." 37 C. J. Tit. Limitation of Actions, s. 617. Titus v. Ash, 24 N.H. 319 is one of the cases cited in support of the rule that a new promise is sufficient though made to a stranger, and in that case it was said (p. 329) that "a promise and acknowledgment to a third person are clearly sufficient to take the case out of the statute and avoid the plea." The same rule seems to have been applied in Betton v. Cutts, 11 N.H. 170. In Titus v. Ash, however, the alleged new promise was made to the creditor's attorney. In Betton v. Cutts, supra, it was made after the death of the creditor to his daughter's husband. The daughter was clearly a party in interest, and if not made for the purpose of being communicated to her, it might have been found that the debtor had reason to know that it would be communicated to her and influence her conduct. It therefore appears that when the court in Titus v. Ash spoke of "a third person" it was not dealing with a "stranger," and these cases can hardly be regarded as authority for the proposition that a new promise made to stranger is sufficient. There appears to be no answer to the observation of the Pennsylvania court that "It is a perversion of the word promise to apply it to a declaration made to one who has no interest in or connection with the subject spoken of." Kyle v. Wells, 17 Pa. St. 286, 290, and in the absence of controlling authority to the contrary, the rule in this state is declared to be in accordance with that sanctioned by the weight of authority as above set forth.

In the present case the court reported no finding as to the existence new promise nor can it be assumed that such a finding was in fact made, for it is specifically stated that the ruling in question was based upon the "foregoing" or previously reported facts. The situation is similar to that which existed in the case of Hatch v. Hillsgrove, 83 N.H. 91, 98, where it was said, "We are of the opinion that the trial court thus purports to base its decree solely upon the facts reported; and that, therefore, the general finding for the plaintiff does not carry by implication the necessary supporting finding" — which was in that case that the plaintiff had no adequate remedy at law. It, therefore, follows that the ruling of the court in this case cannot be sustained unless it can be said as a matter of law that the only conclusion to be drawn from Edwin's conduct is that he made a new promise. Engel v. Brown, supra, 186. The facts do not compel such a conclusion. It might with equal force be urged that the reference to the mortgage "running to Robert Dawes" in the deed to Annie D. Mullaley was designed simply to call her attention to known but supposedly innocuous cloud upon her record title and to avoid the possibility of future misunderstanding from that source. When Edwin's reference to this mortgage was made, Robert Dawes had been dead almost nine years, and no one had ever been appointed to execute his will. The only person who is definitely shown to have had an interest in the mortgage at that time was Edwin himself. By the terms of Robert's will, he took a one-half interest in the mortgage debt, and as an heir of his other brother Benjamin, he took a further interest in it, which was presumably a quarter. The idea that as mortgagor he intended to make a new promise to himself as mortgagee is too fanciful to command serious attention.

It might be found, however, that Annie D. Mullaley was a person to whom a valid new promise could be made. If she was not actually a party in interest, it might be found that she was a person who would be likely to communicate the acknowledgment to a party in interest. Assuming that the statutory rules of descent were not superseded by deed or will, her precise status would depend upon whether her mother, Nellie E. Mullaley, was living when the deed was executed. Nellie was a sister of both Edwin A. and Benjamin F. Dawes, and at the time of Benjamin's death in 1915, she or her heirs apparently succeeded to a quarter interest in the mortgage debt. If she died intestate before the deed to Annie was given, then Annie, as one of her heirs, would have an interest in the mortgage. If she was living at that time, then an acknowledgment made to Annie would come within the class of those "made with reason to know that it would be communicated to and influence the creditor." It is also possible that the evidence may show that Annie was an entire stranger to the mortgage. If this appears to be the fact, then the acknowledgment made to her would not operate to defeat the bar of the statute, but if it appears that her status was such that a new promise might be made to her, then such a promise might be inferred from the acknowledgment.

It is plain that further proceedings in the superior court will be necessary, and the order here is

Exception sustained.

All concurred.

ON REHEARING. After the foregoing opinion was filed, the defendant moved for a rehearing and argument was invited upon this motion.