Weaver v. Farrington — 56 N.Y. St. Rep. 523

Majority

p. 523

William H. Weaver et al., Resp’ts, v. Joseph T. Farrington, Impleaded, etc., App’lt.

(New York City Court, General Term,

Filed November 27, 1893.)

Headnote

Bills and notes—Consideration.

Part payment and the giving of a renewal note for a less amount in place of the former note constitute a good consideration for an indorsement of such renewal note.

Nelson S. Carr, for respt’s; Samuel C. Mount, for appl’ts.

This is an appeal by defendant from a judgment entered herein in favor of the plaintiffs, and against the defendants upon the verdict of a jury, rendered at the direction of the court.

The action was brought to recover the sum of six hundred and twenty-five dollars ($625) with interest, from the 8th day of March, 1893, on a promissory note dated at the city of New York, March 8, 1893, made by one George Blair, payable to the order of Joseph T. Farrington and endorsed, transferred and delivered by the latter to the plaintiffs for value. The note is duly-pleaded in the complaint.

The answer substantially avers that the note in suit was endorsed by defendant Farrington without a consideration, and was diverted by his co-defendant Blair, from the purpose for which it was intended. The defendant Blair failed to appear in this action. The" part payment and the giving of another note of lesser amount, in place of the $700 note, was a good consideration for the transfer of the note in suit. Newman v. Frost, 52 N. Y., 424 ; Meyer v. Heidelbach, 123 id., 332, 339 ; 33 St. Rep., 610 . There was sufficient consideration for the endorsement of this defendant. See National Bank of Gloversville v. Place, 86 N. Y., 444 .

Andrews, J., at page 447, says : “It is claimed, however, that, assuming the genuineness of the indorsement of the note of May 24th, there was no consideration to uphold the indorsement of that note, nor consequently of the note given in renewal. We think this point is not tenable. The oral contract made between the bank and Wooster, in December, 1875, to carry the indebtedness of Wooster, arising out óf his indorsements for the Burrs, for one year, was to be performed by his giving short paper, indorsed by the defendant Place and others,- which the bank was to renew from time to time, as it fell due. The note of May 24th was given to renew paper taken by the bank under this arrangement. This prior paper was due or about due when the note was given. The bank could have sued that paper when due, and proof of the agreement to carry the debt, and that new notes had been tendered in renewal, would not have been a defense. The proof of the contract to carry would not have been admissible to control the legal effect of the promises contained in the notes, to pay at a ■ fixed time.

“ The bank, if it had refused to perform its agreement to renew,

p. 524

would, I think, have been liable for the breach, but only on the theory that the promise to carry the debt was a collateral promise independent of the written contract contained in the notes. It would have constituted no defense to an action upon the notes falling d ue within the year. At most it would have constituted a counterclaim to the extent of the injury sustained by its breach. In this view there was ample consideration for the indorsement by the defendant Place of the note of May 24th. The bank, upon taking that note, cancelled the prior paper and extended the payment of the debt. The note in suit was indorsed to be used at the bank to take upon the note of May 24th. This was understood by Place, and it is immaterial, upon the question of consideration at whose request this indorsement was made.” This case is exact in point and controlling. See Young v. Lee, 12 N. Y., 555 ; Phœnix Ins. Co. v. Church, 81 id., 218, 222.

We find no error on the part of the trial justice, and judgment should therefore be affirmed, with costs.

Van Wyck and Newburger, JJ., concur.