Allen v. Bantel

2 Thomp. & Cook 342

• Court: New York Supreme Court
• Decided: December 15, 1873
• Status: Published

Opinion

Muimr, P. J.

The judgment appealed from must be- affirmed.

The plaintiffs testified and the jury must have found that the notes made by Vaughn were taken in part payment of the buggy sold to the defendant, upon his guaranty that the maker was solvent and able to pay them, and that they would be paid, and if they were not, he, defendant, would pay them.

¡Notes of third persons thus taken are not deemed to be taken as absolute payment, and if not paid the person delivering them, is liable for such part of the price of the property sold as the notes were intended to pay.

The general rule is, that the note of a third person transferred to the vendor of property in payment in whole or in part of the price of property previously sold is not payment, unless it is expressly agreed so to be. Noel v. Murray, 13 N. Y. 167; Hays v. Stone, 7 Hill, 128. But when the transfer is made at the time of the purchase, the presumption is, that it is received in payment, and the burden of proving the contrary rests on the creditor. Whitbeck v. Van Ness, 11 Johns. 409; Rew v. Barber, 3 Cow. 272; Breed v. Cook, 15 Johns. 241.

In the case in hand the notes were received as payment, but upon defendant’s guaranty that the maker was responsible, and if he did not pay defendant would. Such an undertaking is evidence that the notes were not received as absolute payment. Monroe v. Hoff, 5 Den. 360; Johnson v. Gilbert, 4 Hill, 178; Torry v. Hadley, 27 Barb. 192; Tyler v. Stevens, 11 Barb. 485.

It is of no consequence whether the guaranty is in writing or by parol, nor whether it is valid or void. • In either case it is evidence that the creditor did not accept the instrument as an absolute payment of his demand, and, therefore, when the note or other obligation becomes due, and it is then unpaid, the creditor may sue on the original debt and cancel such collateral security on the trial. Waite’s L. & P. 408, and cases cited.

Such being the rights and liabilities of the parties the plaintiffs were not under any obligation to attempt to collect the notes of the maker, and the omission to do so is not negligence.

It was the duty of the defendant, if he desired to have the notes collected by suit, to have paid the plaintiffs the amount due them and taken up the notes.

The judgment is right, and must be affirmed.

Judgment affirmed.