Youngberg v. Nelson

Supreme Court of Minnesota

Youngberg v. Nelson

53 N.W. 629, 51 Minn. 172, 1892 Minn. LEXIS 34

CourtSupreme Court of Minnesota

DecidedOctober 29, 1892

StatusPublished

Cited by14 cases

This text of 53 N.W. 629 (Youngberg v. Nelson) is published on Counsel Stack Legal Research, covering Supreme Court of Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

Youngberg v. Nelson, 53 N.W. 629, 51 Minn. 172, 1892 Minn. LEXIS 34 (Mich. 1892).

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Opinion

Mitchell, J.

The defendant transferred the promissory note of a third party to plaintiff by indorsement “without recourse,” and the only question necessary to be considered is whether evidence of a contemporaneous oral guaranty of payment was admissible.

We are clearly of the opinion that the case falls within the familiar elementary rule that parol contemporaneous evidence is inadmissible to contradict or vary the terms of a valid written contract.

The parties have put their engagement into writing (as evidenced by the qualified indorsement) in terms that are certain as to the object and extent of such engagement. It is therefore conclusively presumed (in the absence of any showing of fraud or mistake) that their whole engagement on the subject covered by the indorsement was reduced to writing.

While, by the very act of transferring paper, whether by indorsement or mere delivery, a party engages that it is what it purports to be, — the valid obligation of those whose names are upon it, — and that he has good title to it, yet when the indorsement is “without recourse” the indorser specially declines to assume any responsibility for its payment. According to the meaning of the terms in the law merchant, this is the express condition of the contract, as much as if stated in detail in so many words. That evidence of a contemporaneous oral agreement that the indorser should be liable, as guarantor, for the payment of the note, would vary and contradict the terms of such a written contract, would seem self-evident.

This court has steadily held, from the early cases of Levering v. [174]*174Washington, 3 Minn. 323, (Gil. 227,) and Kern v. Von Phul, 7 Minn. 426, (Gil. 341,) down to Farwell v. St. Paul Trust Co., 45 Minn. 495, (48 N. W. Rep. 326,) that the implications and intendments which the law merchant has attached to blank indorsements of negotiable paper render them express and complete contracts, which cannot be varied or contradicted by parol; as, for example, that an indorser cannot show that the indorsement was merely for the purpose of transferring title, and that there was an oral agreement that it was to be without recourse.

If this rule is applicable when invoked against the indorser, it must also be so when invoked in his favor. Neither can it make any difference whether the indorsement is qualified or unqualified.

Order reversed.

(Opinion published 53 N. W. Rep. 639.)

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Mitchell, J.

The defendant transferred the promissory note of a third party to plaintiff by indorsement “without recourse,” and the only question necessary to be considered is whether evidence of a contemporaneous oral guaranty of payment was admissible.

We are clearly of the opinion that the case falls within the familiar elementary rule that parol contemporaneous evidence is inadmissible to contradict or vary the terms of a valid written contract.

The parties have put their engagement into writing (as evidenced by the qualified indorsement) in terms that are certain as to the object and extent of such engagement. It is therefore conclusively presumed (in the absence of any showing of fraud or mistake) that their whole engagement on the subject covered by the indorsement was reduced to writing.

While, by the very act of transferring paper, whether by indorsement or mere delivery, a party engages that it is what it purports to be, — the valid obligation of those whose names are upon it, — and that he has good title to it, yet when the indorsement is “without recourse” the indorser specially declines to assume any responsibility for its payment. According to the meaning of the terms in the law merchant, this is the express condition of the contract, as much as if stated in detail in so many words. That evidence of a contemporaneous oral agreement that the indorser should be liable, as guarantor, for the payment of the note, would vary and contradict the terms of such a written contract, would seem self-evident.

This court has steadily held, from the early cases of Levering v. [174]*174Washington, 3 Minn. 323, (Gil. 227,) and Kern v. Von Phul, 7 Minn. 426, (Gil. 341,) down to Farwell v. St. Paul Trust Co., 45 Minn. 495, (48 N. W. Rep. 326,) that the implications and intendments which the law merchant has attached to blank indorsements of negotiable paper render them express and complete contracts, which cannot be varied or contradicted by parol; as, for example, that an indorser cannot show that the indorsement was merely for the purpose of transferring title, and that there was an oral agreement that it was to be without recourse.

If this rule is applicable when invoked against the indorser, it must also be so when invoked in his favor. Neither can it make any difference whether the indorsement is qualified or unqualified.

Order reversed.

(Opinion published 53 N. W. Rep. 639.)

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53 N.W. 629, 51 Minn. 172, 1892 Minn. LEXIS 34, Counsel Stack Legal Research, https://law.counselstack.com/opinion/youngberg-v-nelson-minn-1892.

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