1 Bosw. 431 14 N.Y. Super. Ct. 431

Anton Hauck v. Joseph Hund.

The payee and first endorser of a note, cannot recover against the second endorser, either in an action on the note itself, or on the allegation and proof of a verbal agreement, that the note was endorsed by the second endorser to accommodate the maker, and to secure payment to the first endorser, of a loan of money made to the maker on the security of such endorsement, and on the agreement of the second endorser to pay the note at maturity, if the maker did not.

To allow a recovery in such a case would violate the rule which prohibits the clear legal import of a written contract to be varied by parol, and would violate the Statute of frauds, which declares all agreements to answer for the debt or default of another, unless in writing and subscribed by the party to be charged, to be void.

(Before Bosworth and Woodruff, J.J.)

Argued, June 3;

decided, June 27, 1857.

The questions which arose on the trial of this action, being questions of law only, a verdict was taken for the plaintiff subject to the opinion of the Court, and such questions were then directed to be heard at the General Term, in the first instance. The counsel of the parties agreed at the trial, such agreement being evidenced by an order then entered, that, the Court at General Term might dismiss the complaint, if so advised. The cause now comes before the General Term, on a case presenting the questions of law, so directed to be there heard. The action was tried before Mr. JuSTicil Woodkuff and a jury, in March, 1856. The facts, on which the questions of law arise, are as follows;

*432The only written contract held by the plaintiff, (so far as the evidence in this action disclosed the facts,) to which the defendant is a party, reads as follows, viz.

“ $450 TW. Hew York, May 4, 1855.

“One month after date, I promise to pay to the order of Mr. Anton Hauck, four hundred and fifty T”„0- dollars, valúe received.

(Signed) “ Wir. Seeback, 15f Bowery.

(Endorsed) “Joseph Hund, 121 Hester.

“Anton Hatxck, 267 Bowery.”

The endorsements upon the note, of the names of the defendant, Joseph Hund, and of the plaintiff, Anton Hauck, are in the order of priority above written. This note is a renewal of a former note made by Seeback for the same sum, dated Feb. 1, 1855, and payable three months after its date to the order of Hauck, and endorsed by Hund and Hauck, separately, and in the same order as the renewal note.

Seeback applied to the plaintiff in January, 1855, for. a loan of money, and the plaintiff requiring security for its repayment, the defendant Hund agreed with the plaintiff, that if he would lend the money to Seeback, Hund would endorse the note of Seeback to be given for the money loaned, and if Seeback did not pay the money loaned, Hund would pay it himself. The defendant, for the purpose of fulfilling that agreement, and with intent to become bound to the plaintiff for the sum specified in the note of Feb. 1, 1855, placed his name thereon; and the plaintiff, in reliance upon that agreement, discounted that note. The plaintiff at that time not having money which he could lend, but being a dealer in cheese, and Seeback being pressed for money, the plaintiff, at his solicitation, and in order to raise money for Seeback’s use, and without any intent to get more than legal interest, sold 2,506 pounds of cheese at thirteen cents per pound, that being the best price which could be obtained, although the fair market value was then fifteen cents per pound, and paid the moneys received therefor, and other moneys of his own, to an amount, including the loss upon the cheese at two cents per pound, equal to the amount of the note; Seeback *433having agreed, in order to induce the plaintiff to make such sale, to bear such loss. This sale was made, and the proceeds thereof, and other moneys of the plaintiff, were paid by Mm to Seeback, in reliance upon the aforesaid agreement and endorsement, the note so endorsed by the defendant as aforesaid having been delivered to the plaintiff before he paid such moneys to Seeback.

The sale of the cheese was a bond fide transaction, and was not intended by the plaintiff or Seeback as a cover to conceal an intent to secure to the plaintiff more than at the rate of seven per cent, interest on the money loaned. The purchaser of the cheese sold it for eighteen cents a pound not long after he bought it.

On the day the note of Feb. 1, 1855, matured, the note in suit was made and endorsed, and delivered to the plaintiff, in renewal thereof, and for the purpose and with the intent of continuing the several liabilities of Seeback and Hund to the plaintiff, intended to be created by the agreement hereinbefore set forth, and the original note and the endorsement thereof by the defendant.

When the note in suit became due, payment of it was duly demanded of Seeback, who refused to pay it; due notice of such demand of payment, and of such refusal, was given to the defendant Hund.

The note in suit, with interest on it from its maturity to the time of the trial of this action, amounted to $471.

A verdict was taken for that sum for the plaintiff, subject to the opinion of the Court at General Term, upon the questions of law arising upon the facts above stated, and with liberty to the Court, (granted by the consent of the counsel given at the trial) to dismiss the complaint if so advised, and to either party to turn the case into a bill of exceptions.

The case was submitted on printed points.

Cutler, Townsend,, and Van Wagoner, for plaintiff.

F. S. Stalknecht, for defendant.

By the Court. Bosworth, J.

Such an agreement as has been proved, is an agreement of Hund, to be answerable for the *434debt or default of Seeback. On such an agreement Hund is not liable, unless it is in writing, and subscribed by him.. 2 R. S, 135, § 2, sub. 2.

The only written agreement held by the plaintiff to which Hund is a party, is one by which, according to its legal effect, Hauck the plaintiff, promises to pay to Hund, or any subsequent endorser of the note, the note itself, if Seeback fails to pay it, provided that payment of it is demanded of Seeback on the day it falls due, and notice of such demand, and of Seeback’s default, is duly given to Hauck.

Hund does not agree, either by the terms of the written contract, or by its legal effect, to pay anything to Hauck, in any event.

If the plaintiff can recover in this action, he must do so, by violating two settled rules of law.

First. He must be permitted to prove by parol, that the actual agreement was radically different from the written one, which he cannot do.

Second. When such agreement has been proved by parol, he must be permitted to recover upon it, while the statute is peremptory, that the defendant shall not be charged upon such an agreement when proved verbally, merely because it was not reduced to writing and signed by the defendant.

These views, though briefly stated, appear to us to be a perfect answer to the plaintiff’s right to recover.

« It cannot be denied that the effort of the Courts to find some distinction on which they could make parties liable upon their contracts, when clearly proved, although the only written evidence as to what they agreed, was a note endorsed in form like the present, has led to decisions apparently conflicting, in relation to the question before us.

Whenever the Courts depart from the plain meaning of the statute, or a well established rule, in search of some extremely technical consideration, to obviate the supposed hardships of a particular case, it is not strange that conflicting decisions should occur, and that following one questionable precedent after another may lead to consequences, that render it necessary to#ecur to fi^ed principles and abide by them as rules of decision.

The object of the statute exempting a person from liability *435upon his promise or agreement to answer for the debt or default of another, unless the agreement is in writing and subscribed by the person sought to be charged, was to prevent frauds and perjuries.

The rule which forbids the receipt of verbal evidence to establish an agreement contrary to the terms, or clear legal import of the contract of the parties as reduced to writing and signed by them, is one of obvious necessity. Without a firm and uniform application of it, there can be no certainty or safety in the business transactions of life.

It is better for the public that, an individual should occasionally suffer, in consequence of his having omitted the formalities made by law essential to a valid contract, as a penalty for his carelessness, than th^t, written contracts deliberately drawn, and formally signed, should be subject to be varied in their terms, by the uncertainty of human memory, and the selfishness of interest, or that statute law should be disregarded by charging a party under circumstances, which that law declares shall create no liability.

Whether there was any such mistake in the form of drawing the note, as would create a right in favor of the plaintiff to have it reformed by a Court of Equity is a question which does not now arise. (Phelps v. Garrow, 8 Paige, 322.) Ho such relief has been asked, nor has any case been stated by the complaint, with a view to establish a right to it. The complaint states a cause of action arising on contract, and seeks the recovery of money only.

The cases of Hall v. Newcomb, 7 Hill, 416; Spies v. Gilmore, 1 Com. 321; Durham v. Manrow, 2 id. 533; Hall v. Farmer, 2 id. 553; Brewster v. Silence, 4 Selden, 207; Hahn v. Hull, 2 Abb. 352, and Cottrell v. Conklin, 4 Duer, 45, show a disposition to . hold, and some progress in holding parties to their contracts, as they have made them. They deny the right to create by judicial legislation a liability where none exists, by the terms or legal import of the written contract, and enforce the statute of frauds, so as to exempt a party from liability upon contracts, which that statute declares to be void.

We think the verdict should be set aside, and a judgment entered for the defendant, dismissing the complaint with costs.*

Hauck v. Hund
1 Bosw. 431 14 N.Y. Super. Ct. 431

Case Details

Hauck v. Hund
Decision Date
Jun 27, 1857

1 Bosw. 431

14 N.Y. Super. Ct. 431

New York



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