Newt Cannon, Jr., filed the original bill in this cause against Ben D. Ewin, Sr., and the Nashville American Trust Company, executor of the estate of Mrs. Sue P. Allen, deceased, to collect certain notes executed by Ben D. Ewin, Sr., to the National Bank of Franklin, from which bank he had purchased same. And he sought to have the proceeds of a $7,000 legacy given to Ewin by his half-sister, Mrs. Sue P. Allen, in her last will, applied to his indebtedness.
The Nashville American Trust Company, executor, resisted the appropriation of the legacy on the ground that Ewin owed his sister's estate a note of $6,975, with interest, equal in amount to the legacy, and therefore the estate owed him nothing.
The executor filed a cross-bill seeking a decree in its favor on said note, and asked that the legacy be appropriated to the payment of the decree on the note.
Ben D. Ewin, Sr., filed an answer and a cross-bill in which he denied liability, and set up the defense that his sister had given him the note, and asked that it be declared null and void and ordered to be canceled, and asked for a decree for the legacy.
The executor answered denying that the note was given to defendant Ewin, and insisted that the note was a valid obligation, and that the amount of the legacy should be offset against the note.
A jury was demanded, and the following issues were submitted and answered in the affirmative by the jury:
"Issue No. 1: When Mrs. Sue P. Allen paid off certain notes for Ben D. Ewin, Sr., totalling $6,975, on or about October 15, 1926, was this transaction in the nature of a gift to said Ben D. Ewin, Sr., by said Sue P. Allen?
"Issue No. 2: With respect to the note of $6,975 dated October 15, 1926, executed by Ben D. Ewin, Sr., to Mrs. Sue P. Allen, was same cancelled by the said Mrs. Sue P. Allen and in effect delivered up by her to the said Ben D. Ewin, Sr., prior to the death of the said Mrs. Allen?
"Issue No. 3: Was said note being held at the time of the death of Mrs. Sue P. Allen by the Nashville American Trust Company as the agent of the said Ben D. Ewin, Sr., and subject to his call for delivery?
"Issue No. 4: Was it the intention of the said Mrs. Sue P. Allen to leave the said Ben D. Ewin, Sr., the legacy in her will free, clear and unembarrassed by any claims or demands of her estate upon Ben D. Ewin, Sr.?"
The court overruled the executor's motion for a directed verdict at the close of all the evidence. A motion for a new trial was overruled, and a decree was entered dismissing the original bill, and *Page 397 the court rendered a decree in favor of Ben D. Ewin against the executor and said estate for the $7,000 legacy, to which the executor excepted, and has appealed and assigned errors.
Complainant Newt Cannon, Jr., did not perfect his appeal.
The assignments of errors, when summarized, are:
(1) There was no evidence to sustain the verdict, and the court erred in not directing a verdict in favor of the executor.
(2) The court erred in holding that the $6,975 note had been canceled by Mrs. Allen and in effect delivered up to Ewin, and in rendering a decree for the amount of the legacy in favor of Ewin and against Mrs. Allen's estate.
Mrs. Sue P. Allen, a widow, was the owner of an estate of about $500,000. She had no children, and her nearest relatives were two half-sisters and two half-brothers; but at the time of her death two half-sisters and one half-brother survived. The half-brother was defendant Ben D. Ewin, Sr.
Mrs. Allen had for years expended considerable sums of money on the needs of her half-brothers, half-sisters, nieces, nephews, and relatives, which were not repaid or expected to be repaid.
Ben D. Ewin, Sr., was married, had six children, and had no estate, property, or income. Mrs. Allen frequently became surety for him on notes, which she subsequently paid.
On October 15, 1926, Mrs. Allen paid Ewin's notes amounting to $6,975, on which notes she was indorser. She asked E.R. Burr, of the American Trust Company, who managed her business affairs, to request Ben D. Ewin, Sr., to execute a note to her for $6,975. Mr. Ewin executed the note and paid interest on it for four months.
At Mrs. Allen's death the note was among her assets at the bank.
Mrs. Allen's will made a bequest to Ben D. Ewin, of $7,000. The note with interest amounted to approximately $7,000. The executor refused to pay the bequest to him, insisting that it should be applied on the note.
Mr. Ewin testified that Mrs. Allen told him before her death that the note was paid and at the bank, and was not held against him; that Mr. Burr, vice-president of the American Trust Company, held the canceled note, and that he, Ewin, could go and get it. This testimony was objected to by the executor, and same was excluded.
Mr. Burr testified that at the request of Mrs. Allen he secured the note from Ben D. Ewin; that it was delivered to the American Trust Company's trust department where it was held in the agency account for Mrs. Allen; that it was held with other assets of Mrs. Allen's; that he had never had any further conversation with Mrs. Allen about this note or with any one else; that Ben D. Ewin, Sr., paid four interest payments on same.
A number of other witnesses testified, without objection, that Mrs. Allen had stated that Ben Ewin would not have to pay the *Page 398 note; that she did not expect him to pay it. Witnesses testified that Ben D. Ewin, Sr., was the testatrix's baby brother, that she was as devoted to him as if he were her own son, that she adored him and was crazy about him, that she said that Ben would not have to pay that note, that she had loaned him the money and never expected to collect the note; that her family had criticized her for helping Ben, that she did not care how they felt about it as she intended to do more for him, and that Ben did not owe her anything; that Ben wanted to pay her back, but she never expected to let him do it, and that she did not hold anything against him; and that she had fixed it so that Ben would not want for anything; but that she was leaving him that much less in her will. All of this testimony went to the jury without objection, and the question about its admission was not raised in the motion for a new trial.
There are but two determinative questions in this case: First. Was the $6,975 note executed by Ewin to his sister, Mrs. Allen, discharged, renounced, or given to him, and the gift perfected by actual or constructive delivery? Second. Was the oral evidence that she had forgiven the indebtedness, renounced and discharged the note, and had given him that much less in her will, admissible to vary or contradict the terms of the will?
The bequest in the will is as follows:
"I give and bequeath to my brother, Ben R.D. Ewin, the sum of Seven Thousand ($7,000) Dollars."
There is no mention in the will of Ewin's indebtedness to Mrs. Allen.
1. I am of the opinion that the proof is insufficient to show that the note was canceled or given by Mrs. Allen to Ewin, as the evidence of delivery either actual or constructive is lacking. The note was a negotiable note, and is governed by the negotiable instruments statute; the sections pertaining thereto are as follows:
"Sec. 122. Renunciation by holder. — The holder may expressly renounce his rights against any party to the instrument, before, at or after its maturity. An absolute and unconditional renunciation of his rights against the principal debtor made at or after the maturity of the instrument discharges the instrument. But a renunciation does not affect the rights of a holder in due course without notice. A renunciation must be in writing, unless the instrument is delivered up to the person primarily liable thereon." Code 1932, section 7446.
"The possession of a note uncanceled by a person other than the maker is prima facie evidence that the debt evidenced thereby is unpaid. Central Nat. Bank v. Stoddard (1910), 83 Conn. 332, 76 A., 472." 5 Uniform Laws Annotated, 601, and cases there cited; Downing v. Whitlow, 211 Ky. 294, 277 S.W. 262. *Page 399
An unexecuted agreement for cancellation does not discharge a note, and when such agreement is the sole defense a directed verdict for the plaintiff is proper. Ashby v. Butz, 257 Pa. 230, 101 A., 318.
"Where a father, holding a note against his son, indorsed on the note that it was not to draw interest, and, during his last illness, procured an indorsement to be made in a memorandum book that the note was not to be paid, but there was never any delivery of the note to the son, it was not a valid gift inter vivos, and the son was liable thereon to the father's estate." Burge v. Burge's Adm'r (Ky.), 76 S.W. 873.
Section 119 of the Negotiable Instruments Act providing for the discharge of negotiable instruments is as follows:
"Sec. 119. Instrument how discharged. — A negotiable instrument is discharged:
"(1) By payment in due course by or on behalf of the principal debtor;
"(2) By payment in due course by the party accommodated, where the instrument is made or accepted for accommodation;
"(3) By the intentional cancellation thereof by the holder;
"(4) By any other act which will discharge a simple contract for the payment of money;
"(5) When the principal debtor becomes the holder of the instrument at or after maturity in his own right." Code 1932, section 7443.
Of course, notes are discharged when they are burned or destroyed by the agent of the payee at his request in accordance with his intention to make a gift of the debt to the makers; the destruction constitutes a cancellation. The requirements of writing and delivery in section 122 of the Negotiable Instruments Act must be construed not to exclude the other methods of discharge permitted in section 119. Henson v. Henson, 151 Tenn. 137, 268 S.W. 378, 37 A.L.R., 1131.
To constitute a valid gift inter vivos or causa mortis of a negotiable instrument there must be a delivery with an intention to give; and mere declarations of the gift are not sufficient to prove delivery of the property. Evidence of the declarations of an intention to make a gift must be accompanied by proof of such facts and circumstances as will show a delivery. In other words, the proof of declarations must be accompanied by proof of other facts and circumstances from which it might reasonably be inferred that the donor had made actual delivery. Of course, the delivery may be actual or constructive, but the fact of delivery must be shown by other evidence than the mere declarations of the donor. The courts require strict proof of delivery or some act or circumstance amounting to an actual delivery rather than attribute delivery to *Page 400 a declaration of gift. Atchley v. Rimmer, 148 Tenn. 319, 255 S.W. 366, 30 A.L.R., 1481; Scholze v. Scholze, 2 Tenn. App. 95.
Hence I am of the opinion that the gift of the note to Ewin and its cancellation was not completed as a gift inter vivos or causa mortis.
But of course the principles of law governing deliveries of gifts inter vivos and causa mortis have no application to wills.
2. The same rules apply to wills as to other written instruments, and ordinarily parol evidence is inadmissible to add to, vary, or contradict the language used. 14 Ency. of Evidence, 498-500; Clark v. Clark, 2 Lea, 723; Horton v. Thompson, 3 Tenn. Ch., 575, 581; Weatherhead v. Sewell, 9 Humph., 272, 302.
Ordinarily declarations of a testator are inadmissible to aid in the construction of his will, except in explanation of latent ambiguities. 14 Ency. of Evidence, 500, 504, 506-507; Hennegar v. Deadrick (Tenn. Ch. App.), 54 S.W. 138; Rodgers v. Rodgers, 6 Heisk., 489, 500; Gourley v. Thompson, 2 Sneed, 387, 391; 40 Cyc., 1427.
There are, however, cases holding that where the creditor leaves a legacy to one of his debtors parol evidence of the testator's intention to release the debt is admissible and constitutes a good defense to an action brought by the executor to recover it. Zeigler v. Eckert, 6 Pa. 13, 47 Am. Dec., 428. But that is not the law in Tennessee. Tennessee has no statute governing wills of personal property; hence wills of personally are governed by the common law. Taylor v. Taylor, 14 Tenn. App. 101.
"The question in expounding a will," as Sir James Wigram most correctly states in his work on Extrinsic Evidence in Aid of the Interpretation of Wills (2 Ed.) page 7, "is not what the testator meant, but what is the meaning of his words."
"The use of the expression that the intention of the testator is to be the guide, unaccompanied with the constant explanation, that it is to be sought in his words, and a rigorous attention to them, is apt to lead the mind insensibly to speculate upon what the testator may be supposed to have intended to do, instead of strictly attending to the true question, which is, what that which he has written means. The will must be expressed in writing, and that writing only is to be considered." Abbott v. Middleton et al., 7 H.L. Cas. 114, 115 (S.C. 28 L.J. Ch. 110), 25 English Ruling Cases, 732 to 759.
"And so the courts are always careful in discussing the admissibility of extrinsic evidence to recognize the rule that it is the intent of the testator as expressed in the language used which controls, and all evidence admitted is admitted for the purpose of arriving at this particular intent." 14 Ency. of Evidence, 499.
"Even in cases where extrinsic evidence is admitted to explain latent ambiguities, and to perfect imperfect descriptions of beneficiaries, *Page 401 or the subject-matter of devises or bequests, no evidence is admissible to change or vary the testator's expressed intent. This must always be deduced from the will itself, assisted by such extrinsic evidence. The proofs afforded by such evidence are to be employed merely as an aid to the court in determining what in fact was the expressed intent of the testator; and, if that intent may not be so found, the devise or bequest must lapse, since it is not within the power of a court to make a new will." In re Dominici's Estate, 151 Cal. 181, 90 P. 448, 450.
Parol evidence is not admissible to show an intention not expressed in the will itself or to aid in making a will which the testator intended to but did not in fact make, where the language of the will is plain and unambiguous.
"In other words, the law never opens the door to parol evidence in order to add to or take from wills but for the purpose only of applying their terms or provisions to the objects or subjects therein referred to, and in order to reach a correct interpretation of such language or terms as are therein expressed." 28 R.C.L., 270, sec. 243.
These questions were thoroughly discussed in the case of Weatherhead v. Sewell, 9 Humph., 272, in which Judge Turley differentiated latent and patent ambiguities and stated that the rule admitting extrinsic evidence should be confined to the limit of ascertaining the intent of the testator as expressed in the language used in the will, and that oral evidence should be admitted only for the purpose of arriving at such intent. He said:
"Parol testimony is admissible to explain ambiguities; but in analogy to the principle on which parol evidence is admitted to explain, but not contradict or enlarge the import or expression of an instrument of writing, a distinction runs through the cases between latent and patent ambiguities.
"Mr. Roberts, at page 15 of his work upon the statute of frauds, defines a latent ambiguity to be, where the equivocality of expression, or obscurity of intention does not arise from the words themselves, but from the ambiguous state of extrinsic circumstances to which the words of the instrument refer, and which is susceptible of explanation by the mere development of extraneous facts, without altering or adding to the written language, or requiring more to be understood thereby than will fairly comport with the ordinary or legal sense of the words and phrases made use of. He defines a patent ambiguity to be one produced by the uncertainty, contradictoriness, or deficiency of the language of an instrument, so that no discovery of facts, or proof of declarations, can restore the doubtful or smothered sense without adding ideas which the actual words will not themselves sustain. And he observes that it follows from this explanation that the statute of frauds, which, in this particular, is *Page 402 declarative and corroborative of the rule of the common law, virtually forbids, in the cases within its provisions, the resort to extrinsic proof in those instances wherein the ambiguity is patent, and only admits it in those cases in which the ambiguity is latent; and, in such cases, the object of the collateral testimony is only by a comparison of the words of the instrument with external circumstances, whether consisting of facts or declarations, to attach a meaning and applicability to expressions within the limits of their grammatical or legal acceptation. The statute seems in no danger of violation by the admission, for these purposes, of this species of evidence. . . .
"As these ambiguities are generated by facts, so they may be removed by a further investigation of facts or matter extrinsic. But if these ambiguities occur in the wording of the will, producing a palpable uncertainty upon its face, extrinsic evidence cannot remove the difficulty, without putting new words into the mouth of the testator; which in effect would be to make a will for him." Weatherhead v. Sewell, 9 Humph., 295, 296.
"As the law requires wills to be in writing, it cannot, consistently with this doctrine, permit parol evidence to be adduced, either to contradict, add to, or explain the contents of a will. The principle of this rule, as Mr. Jarman has well said, evidently demands as inflexible adherence to it, even where the consequence is the partial or total failure of the testator's intended disposition. For, it would have been of little avail to require that a will ab origine should be in writing, or to fence a testator round with a guard of attesting witnesses, if, when the written instrument spoke one thing, or failed of explicitness in some respects, its provisions could be corrected, or its deficiencies supplied from extrinsic sources. No principle connected with the law of wills is more firmly established, or sustained by a more continuous line of decisions from the earliest to the latest times. Lord Cheney's Case, 5 Rep. 68 b; Strode v. Lady Falkland, 3 Ch. R., 181; Mann v. Mann, 1 Johns. Ch. [N.Y.], 231; Weatherhead v. Sewell, 9 Humph., 272; Den ex dem. Weatherhead v. Baskerville, 11 How., 357 [13 L.Ed., 717]. The declarations of the testator relied on in the bill are, therefore, wholly inadmissible." Horton v. Thompson, 3 Tenn. Ch., 580; Clark v. Clark, 3 Lea, 723; Mackie v. Story, 93 U.S. 589, 23 L.Ed., 986; Wilkins v. Allen, 18 How., 385, 15 L.Ed., 396.
As the full extent of the testator's bounty is supposed to be disclosed by the will, a legacy to a debtor does not operate as a release of the debt unless the will clearly manifests the intention that it shall so operate, which intention may be manifested by express words or by necessary implication. 40 Cyc., 1889 to 1890; 2 Williams on Executors (7 Am. Ed.), 618; 28 R.C.L., 298.
"On principle, any evidence of the testator's declarations, or other parol proof of his intention to release the debt by giving the *Page 403 legacy, short of an actual, independent release, is wholly inadmissible, on the ground that there is no presumption on the subject, and the admission of such testimony would tend to vary the terms of the will and supply an intention not disclosed by its language." Sizer's Pritchard on Wills and Executors, sec. 466; 40 Cyc., 1889 (v).
The fact that a creditor gives the debtor a legacy, without more, raises no presumption that he intended to forgive the debt.
"A testamentary gift from a creditor to a debtor stands upon an entirely different footing from one by a debtor to his creditor. . . . A legacy from a creditor to his debtor, unaccompanied by language in the will or exterior to it expressly showing the special intent, whether equal to, greater or less than, the debt, raises no presumption whatever, either of law or of fact, that the testator intended thereby to excuse, release, or discharge the debt, so that the legatee would be entitled to claim and receive the whole amount bequeathed, but would be freed from all liability to pay the debt. In fact, such a legacy produces no effect upon the indebtedness. The only effect which such a legacy given simpliciter can have is to create the right to an equitable set-off. The legatee might not be forced, by means of a legal action, to pay the debt to the executors, when he could in turn recover back from them the same amount, or a part thereof, by virtue of his legacy. A court of equity, in order to prevent this circuity of action, may permit the executors to set off the debt against the demand made on them for the legacy; and if the estate is solvent, so that the debtor will be entitled to receive payment of his legacy, the court may compel the executors to give him credit for the amount of the legacy, when they are seeking to enforce the claim of the estate upon him for the debt." 2 Pomeroy's Equity Jurisprudence (3 Ed.), sec. 541.
"A legacy to a creditor does not extinguish the debt; unless it was so intended by the testator. A legacy given and accepted by a creditor of the testator does not extinguish the debt of the legatee against the testator. To extinguish a debt of the legatee, it must clearly appear from the will that the testator intended the legacy as a payment instead of a bounty." German v. German, 47 Tenn. (7 Cold.), 180.
Admission of parol evidence about the testator's intention, without objection, where there is no ambiguity, does not change the situation "for the very evident and all sufficient reason that no such desire and intention were incorporated in the will." Parol evidence of such intention was apparently admitted without objection in the cases of Weatherhead v. Sewell, 9 Humph., 273, and Clark v. Clark, 2 Lea, 723. The cases of Dixon v. Cooper,88 Tenn. 177, 12 S.W. 445, and Horton v. Thompson, 3 Tenn. Ch., 575, were heard on demurrers, but the court held that if the facts alleged were admitted to be sufficient to show the testator's intention, dehors the will, that *Page 404 would give the parties no interest for the reason that no such intention was incorporated in the will.
I think there is little doubt that Mrs. Allen intended to cancel the note and to give her brother, Ben D. Ewin, Sr., that much less in the bequest of the legacy to him, but she intimated no such intention in the will, and extraneous evidence of such an intention is not admissible for the purpose of changing the will. Parol evidence cannot be admitted either to contradict, add to, or explain a will where there is no ambiguity on its face. However, I think the fourth issue as worded was immaterial and should have been disregarded by the court. Carpenter v. Wright,158 Tenn. 289, 13 S.W.2d 51.
3. Defendant Ben D. Ewin, Sr., contends that the court erred in refusing to admit in evidence his testimony as to conversations had with Mrs. Allen in regard to cancellation of the note, because he says he was called by the opposite side, Newt Cannon, Jr. I think the chancellor was correct in sustaining the objections to this testimony, as the cross-bill was filed by the executor, and Ben D. Ewin, Sr., was the party for or against whom a judgment might be rendered. Code, sec. 9780; Atchley v. Rimmer,148 Tenn. 303, 255 S.W. 366, 30 A.L.R., 1481; Wilson v. Wilson,151 Tenn. 486, 267 S.W. 364.
"The court will also consider the interest of the parties when one of them is . . . called to testify by another, no matter what his technical position on the record may be." Roy v. Sanford,140 Tenn. 382, 204 S.W. 1159, 1161; Trabue, Davis Co. v. Turner, 10 Heisk., 447, 453; Nashville Trust Co. v. Williams, 15 Tenn. App. 445.
However, I understand that the majority opinion is not based on this testimony.
In conclusion, I am compelled to dissent for the reasons above set out. The bequest to Ben D. Ewin in the will is as follows: "I give and bequeath to my brother, Ben R.D. Ewin, the sum of Seven Thousand ($7,000) Dollars." That is a plain statement, and there is no ambiguity about that sentence.
He was indebted to his sister at this time, but there is no mention of the fact in the will.
At the time Mrs. Allen made her will she was indorser on Ewin's notes to the extent of about $7,000, which she knew would have to pay. She possibly intended to give this to him when she paid the notes, but she made no provision in the will for the payment of the notes as an additional legacy. She evidently intended to provide for that aside from the will. Several years after making her will she took from him the note in question. Whether or not she changed her intention to pay the notes on which she was indorser cannot affect the will. In construing wills the court will take into consideration the facts and circumstances surrounding the testator at the time of the execution of the will. Thompson on Construction of Wills, secs. 45 and 47 *Page 405
My view is that the will calls for no explanation, and the matter of the note is a separate transactions which will have to be settled without reference to the will, and is concerning a situation that arose long after the will was written.
Where the terms of the will are plain and there are no ambiguities, the intention of the testator as expressed in the will must control. Martin v. Hale, 167 Tenn. 438,71 S.W.2d 211.
The fact that her bequest to her brother was less than some of her bequests to strangers is not an ambiguity, and parol evidence cannot be admitted to explain it.
The only question in this case is whether she intended to collect this note executed several years after the will was written, and the settlement of that question can in no way affect the provisions of the will; therefore, I think the decree should be reversed.