Leibinger & Oehm Brewing Co. v. Ernst — 69 N.Y. St. Rep. 440

Majority

p. 440

Leibinger and Oehm Brewing Company, Resp’t v. Frederick H. Ernst, App’lt.

(Supreme Court, General Term, Second Department,

Filed July 26, 1895.)

Headnote

Contract—Promise to pat third person.

Where an agreement was alleged to have been made by the mortagor with the intended purchaser of the mortgaged chattels for the application on the mortgage of part of price tobe paid by such purchaser, and the-money was paid to his attorney and so receipted for, and upon the subsequent denial of such agreement by the mortgagor, the attorney paid the whole amount to him, the mortgagee cannot recover any portion of such purchase price from the attorney.

Appeal from a judgment, entered on a verdict in favor of plaintiff, and from an order denying a motion for a new trial.

Henry' 0. Botty {Harmon H. Shook, of counsel), for app’lt; M.\ Hallheimer, for resp’t.

In the early part of June, 1894, Lubersen verbally contracted to sell a saloon to Shoeffel, and was paid $25 on account of the purchase. On June 14th, Lubersen executed a written conveyance of the saloon for the expressed consideration of $100, subject to a mortgage of $1,000, and left it with the defendant, his attorney, to be delivered to the purchaser. On the 16th the purchaser and his attorney called on defendant to reeeivethe conveyance, and stated to him that Lubersen had agreed that the $75 unpaid balance of purchase money might be applied to

p. 441

reduce the mortgage. Defendant replied that he had not been notified of such agreement, but on receiving the $75 executed and delivered to the attorney of the purchaser a paper as follows :

New York, June 16th, 1894.

Rec’d from M. F. Lubersen the sum of $75, to be paid to Leibinger & Oehm Brewing Co. as part payment for goods sold and delivered hy said Brewing Co. to Lubersen.

(Signed) • Fred B, Ernst.

Later, when Lubersen saw defendant, he denied that he had agreed to apply the $75 to reduce the mortgage, and claimed that, it be paid to him, which was done. When the $75 was demanded by the brewing company, defendant refused to pay, and this action was brought. On the trial the principals and attorneys were all examined as witnesses. No proof was offered that Lubersen had in fact agreed to apply the $75 upon the mortgage. The defendant sought to show that Lubersen never did so agree, and the testimony was excluded. The defendant testified that at the time he gave the receipt he stated that he had no personal knowledge of the arrangement to apply the $75 on the mortgage, and should not pay it over without the authority of Lubersen. But the court held that the receipt was a contract that could not be modified by paroi, and directed a verdict for the plaintiff. Numerous objections are urged to this ruling. One apparently well taken, is that the agreement to apply the $75 on the mortgage seems to be a naked promise. No consideration moved to defendant, nor is any shown to have moved to his principal. It is not claimed that Lubersen ever authorized defendant to make the promise. And if it be, as sought to be shown, that Lubersen never agreed to apply the $75 on the mortgage, plainly the defendant would have had no ground to refuse to pay that sum to Lubersen on his demand. The $75 in defendant’s hands was received by him as attorney, which was known to all parties. Had the money in fact been placed in defendant’s hands as recited in the receipt, with instructions to pay it to plaintiffs, Lubersen could have countermanded the order at any time before it was paid over. Nor is there any evidence that plaintiffs ever changed their position in reliance upon the receipt. Upon the whole case we are of opinion that the plaintiffs did not establish a cause of action, and that the judgment must be reversed, and a new trial ordered, with costs to abide the event. All concur.