Lacy v. Lorch

175 S.W. 347, 164 Ky. 253, 1915 Ky. LEXIS 352

• Court: Court of Appeals of Kentucky
• Decided: April 22, 1915
• Status: Published

Opinion

Opinion op the Court by

Judge Nunn

Affirming

The appellee, who was the plaintiff below, recovered a judgment against appellant Lacy for a $700 balance due upon a $1,000 note and mortgage. Lacy appeals. No questions of law are presented. The only objection urged against the judgment is that it is not supported by the evidence.

The controversy arises over the sale of a loan or broker’s business, conducted in the name of Clark & Company. Lacy was originally the sole owner of the business. He sold a half interest in it to Lorch for $500, and, in about four months Lorch bought Lacy’s remaining half for $750. After conducting the business for about two years, Lorch sold all of it back to Lacy. It is this sale that has given rise to the suit. There were $135 worth of fixtures, and notes of the estimated value of $1,300. The notes were numerous, and ranged in amount from $1 to $40, and against people of small means. The whole business, including notes, fixtures, and good will, was sold by Lorch to Lacy for $1,000 on October 30th, 1911. Lacy was to make payments in excess of $50 each month and the whole within one year from date. He made seven payments, the last being on August 3d, 1912. In April, 1913, Lorch sued to recover the balance due on the note, and enforce the mortgage given to secure it. Lacy answered with the plea that Lorch represented to him 'at the time of the sale that the notes “were valid and subsisting obligations,” and that they were “well secured by properly executed chattel mortgages, but * * ■ * after the execution of said note he proceeded to examine said notes, papers and mortgages, and discovered that of the notes and papers delivered to him $524 of the same were absolutely worthless * * * and did not represent valid or subsisting debts * * * that many of said notes and papers had been fully paid * * * and others * * * had died leaving no property or estate of any sort.” He asks and prays for a further credit on the note for $524, to which extent he says the consideration failed.

Lacy filed with his answer an itemized statement of the bad notes going to make up the $524. He introduced many of the makers who testified that the notes referred to had been paid, and they produced receipts tending to show the fact. On the other hand, it was shown for appellee that the witnesses had owed to Clark & Company other debts than the ones referred to, and the receipts presented did not show upon which items of indebtedness they should go as credits or payments. Lacy refused to bring into court the books of the company which would identify the several transactions that the witnesses had with the company. It appears in evidence that, of those bad debts complained of by appellant, $136.80 were included in' his original sale by Lacy to Lorch. It was further shown that Lacy knew the questionable character of the business and notes involved in the transaction, and, for that reason discounted their value. In other words, he agreed to pay $1,000 for the business which had a face value of $1,425.

Lorch by reply says that at the time of the trade, “Lacy went over and examined each and all of the debts sold to him by the plaintiff, including those included in the exhibit filed, on the books of the plaintiff, and he purchased the same, having made his estimates to cover bad debts of about $400, which he took from the face of said debts, and took them as they were, without representation or warranty or' endorsement, and without recourse on the plaintiff, the defendant agreeing to pay the plaintiff therefor $1,000, evidenced by the note sued on.” These allegations are not denied. If it can be said that the facts proven, and the undenied allegations are not sufficient to support the judgment, then it is only necessary to refer to the several letters in evidence which Lacy wrote to Lorch in making remittances during the year. By them he promised other and larger payments, and in none of them does he make any complaint about the sale. The last letter was written October 16th, 1912, a few days before the note matured. In this letter he asks the privilege of renewing it, and says, if permitted to renew, “I shall endeavor to make each and every payment promptly * * * until the note and mortgage is paid in full. ’ ’ In our opinion, the pleadings and proof support the judgment.

It is, therefore, affirmed.