Wright v. John A. Robinson & Co.

This is an appeal from a judgment entered upon the report of a. referee in favor of the plaintiff and against the defendant, for the sum of $177.05, damages and costs.

The facts are undisputed, and were stipulated before the referee. The plaintiff let and rented a store to the defendant for a term commencing August 15,1892, and to terminate on the 31st day of March,. 1895, at the yearly rental of $300, payable monthly.

On the 23d day of January, 1894, the plaintiff wrote to the defendant as follows : “ I wish you would send me a check for my rent, as I am in need of it.” Pursuant to such letter the defendant sent plaintiff its check, dated January 26,1894, for seventy-five dollars for rent then past due. The plaintiff was put to the expense of fifty cents for the collection of such check. The defendant received, no notice of the expense of .such collection.

On the 1st day of February, 1894, the sum of twelve dollars and fifty cents became due and payable on account of rent of said store..

On the 31st day of January, 1894, plaintiff returned said check to the defendant, with a letter reading as follows:

“Noethville, N. Y., Jan. 31 si, 1894.

“ JohN A. RobiNsoN & Co.:

“GeNtlemeN.— I herewith return your cheek for $12.50, as I cannot accept it as payment for anything.

“ Yours, &c.,

“ F. N. WRIGHT.”

The letter and check were received by the defendant February 1, 1894.

All the payments of rent during the term of said lease were made by the defendant’s checks, which were accepted by plaintiff, and ■duly paid, except the installment of twelve dollars and fifty cents before set forth. At the time the check for twelve dollars and fifty cents was drawn and sent by the defendant to plaintiff, there was and ever since have been funds on deposit to the credit of the defendant in the bank upon which such check was drawn, more than sufficient to meet the same had it been presented, and it is conceded that the check would have been paid if presented in the usual course of business.

At the time of the rental of said store by plaintiff to defendant, an agreement was entered into whereby the plaintiff agreed to heat the said store for the defendant, for the sum of forty-five dollars per year, which sum the defendant agreed to pay on the first day of January of each year.

On the 2d day of February, 1894, this action was commenced by the service of a summons and notice upon defendant.

It does not appear when the complaint was served. The complaint sets forth two causes of action; one for twelve dollars and fifty cents, being for the-installment of rent due February 1, 1894, and the other for forty-five dollars, being the amount due January 1,1894, for heating the store, pursuant to the agreement above stated.

On the 9th day of April, 1894, the defendant served its answer

The answer further alleges that the defendant has ever since been, and still is, ready and willing to pay the plaintiff said amount, “ and that said sum of twelve and 50-100 dollars has been actually delivered and paid over to the Clerk of this Court for the use and benefit of said plaintiff, whenever said plaintiff shall elect to receive the same, and that notice of the delivery and payment to said clerk has been given to said plaintiff.”

Upon, the hearing, before the referee, it was stipulated between the parties, “that on the 9th day of April, 1894, the defendant deposited with the Clerk of this Court, to wit: the Clerk of the County of Fulton, the sum of $12.50, in cash, for the use and benefit of plaintiff, and that notice of such deposit was given to and received by the plaintiff at the time the answer herein was served.”

Upon these facts, the referee directed judgment for fifty-seven dollars and fifty cents, with interest from the time the several amounts became due, together with costs, in favor of the plaintiff and against the defendant.

The legal question arising in the case is as to whether the defendant’s sending its check, for the amount due for rent, was a sufficient tender, and, if so, whether such tender has been kept good.

No reason was given for the return of the check, as will be observed by reading the letter heretofore set forth.

At that time the defendant was owing the plaintiff fifty-seven dollars and fifty cents, consisting of two separate and distinct claims; one of forty-five dollars, and one of twelve dollars and fifty cents.

It was the defendant’s legal right to pay either of these separately, and the plaintiff had no right to reject such payment because it was

Its return cannot be sustained, therefore, on the ground that it was not for the full amount the defendant owed the plaintiff.

The defendant made it applicable to the rent due, as it liad a legal right to do, and it was for the full amount of rent then due ; so that it was a good tender, except that it was by check instead of in money.

A check may be a sufficient legal tender. “ The check of the party not objected to was, for all the purposes of a legal tender, the equivalent of money.” (Mitchell v. V. C. M. Co., 67 N. Y. 280 -282.) In that case another reason than that it was a check was given for declining it.

The defendant had been in occupation of these premises for about eighteen months, and all its payments of rent had been made by check. Only seven days before the sending of the check in question the plaintiff had written to it requesting it to send a check for the rent then due. Under such circumstances I think the offer of payment by check was the equivalent of a tender in cash. Of course the plaintiff had the right at any time to put a stop to that method of payment; but payments by check having been the customary and accepted way of dealing between the parties, and the plaintiff having invited payment in that manner so brief a time before, if he had desired to stop payments in that way he should have notified the defendant that that manner of payment would no longer be accepted, and have given an opportunity to make a strict legal tender; good faith required such a course on his part. I do not think that he should be permitted to take advantage of the defendant, after so long a course of dealing between them, by peremptorily stopping it without notice and mulcting the defendant with interest and costs. (Gray v. Green, 9 Hun, 334 -338.)

The action was commenced so quickly after the return of the check, with his reason for refusal unexplained, that the defendant did not have a reasonable opportunity to make the required payment in money.

The defendant’s jn’actice to keep the tender good was proper; it was not necessary to bring the check into court when the amount in money was deposited.

Sections 731 and 732 of the Code of Civil Proceedin'® only apply where a tender is made after the commencement of an action, and do not affect any of the questions raised in this case.

The plaintiff insists that the tender, if made, was not kept good because the defendant did not include, in the amount deposited by it in court, interest upon the sum of twelve dollars and fifty cents from the time it was due, February-first, until the time of such deposit in court.

If sending the check to the plaintiff was a sufficient tender, it stopped interest from that time forth.

“ Before interest can be allowed, in any case, it must be by virtue of some contract, express or implied, or by virtue of some statute, or on account of the default of the party liable to pay, and.then it is allowed as damages for the default.” (Matter of Trustees, etc., 137 N. Y. 95 -98.)

In this case there was no default upon the part of the defendant. It tendered payment in the manner it had been invited and accustomed to pay, and it was, under the circumstances, a legal tender. A legal tender is equivalent to payment as to all things that are incidental or consequential to the debt. The creditor, while not losing his right to the prior debt by his refusal of the tender, does lose all collateral benefit and securities; and where the tender is followed by the payment into court, interest and costs cannot be recovered. (Kortright v. Cady, 21 N. Y. 343 , 347, 366.)

If, on the trial, the defendant establishes the defense of tender, such tender bars the recovery of all interest subsequent to the tender. (Kelly v. West, 36 N. Y. Super. Ct. 304 .)

In Riley v. Cheesman (75 Iiun, 387) and Nelson v. Loder ( 132 N. Y. 288 ) it was held that for the purpose of barring interest, the tender must be kept good from the time of the tender made up to the time of depositing the money in court.

The case of Riley v. Cheesman was an action upon a note, and it was held that an amount sufficient must be kept on deposit to

In this case no question is raised as to the tender not being kept good in the time intermediate between the making of the tender by check and the deposit of the money in court, but it appears that during all that time there was money in the bank to defendant’s credit sufficient to meet the amount of such check if it had been presented.

The effect of a tender is to stop interest and prevent costs, and to be effectual for such purpose must be kept good by the debtor, and whenever he seeks to make it the basis of affirmative relief, it' must be paid into court, where the creditor can get it, and that fact must be alleged in the pleadings. (Halpin v. Phenix Ins. Co., 118 N. Y. 165 -178.)

Here the parties were living at a distance from each other (one in Northville and the other in Troy), and the suit was commenced the day after the rejection of the tender, and the defendant was not called upon to make or keep his tender good by an offer in cash, other than that made in his answer to the complaint, and his notice accompanying the same, when the time came for making his answer to such complaint.

The tender being kept good by the defendant keeping himself at all times able to make a cash payment by having the necessary funds in the bank, and by the deposit in court, the effect of it relates back to the time when it was originally made, and bars the recovery of interest from that time.

These conclusions lead to a reversal of the judgment. The facts being undisputed, judgment is, therefore, ordered for the defendant, with costs, together with the costs and disbursements of this appeal, from which amount should be deducted the sum of forty-five dollars, with interest thereon from January 1, 1894.

MayhaM, P. J., and PutNAM, J., concurred.

Judgment reversed, and judgment rendered for the defendant with costs and disbursements of this appeal, less forty-five dollars, with interest from January 1, 1894.