Merchants' State Bank v. Streeper

Christianson, J.

This is an action on a promissory note in the sum of $500, dated October 25, 1916, payable January 1, 1918. The defense is that there was no consideration for the note. There was no motion for a directed verdict. The jury returned a verdict in favor of the defendant. Plaintiff thereafter moved in the alternative for a judgment notwithstanding the verdict or for a new trial. The trial court gave judgment notwithstanding the verdict. Judgment was entered accordingly, and the defendant has appealed from such judgment.

It appears from the evidence that the defendant was iiistrumental in procuring a purchaser for a tract of land belonging to the plaintiff bank. During the negotiations another tract was substituted, and it was definitely agreed that the commission to be paid to the defendant for obtaining such purchaser should be $500 and no more. In evidence of such agreement the bank executed and delivered to the defendant the following written instrument:

Yelva, North Dakota, October 25, 1916.
“This certifies that Mr. S. S. Streeper of Sawyer, North Dakota,, holds an equity in that certain contract for a deed between the Merchants’ State Bank of Velva, North Dakota, and Mr. Frank S. Dom and his wife covering the west half (W. }4) of section eight (8) township one' hundred fifty-two (152) range eighty (80), said equity being in the sum of five hundred ($500.00) dollars to be paid out of the crops to be raised the fall of 1917 on said land, providing said crops are sufficient, above interest due on the contract and taxes. If such crops are not sufficient then *this equity shall be paid out of subsequent 'crops.
“And the Merchants’ State Bank is this day accepting a note from *585Mr. S. S. Streeper in the sum of five hundred ($500.00) dollars to be secured by his equity in the above-mentioned contract for a deed, to be paid when this equity in the contract is paid.”
“Merchants’ State Bank,
“By A. E. Sevaried, Cashier.”

At the same time this instrument was delivered the defendant executed and delivered to the plaintiff the note in suit; and the cashier of the plaintiff bank delivered to the defendant a note, which he owed to the bank, in the sum of $100, and a cashier’s check for $400, which the defendant subsequently cashed. So far as there is any dispute as to the facts, it relates to what was said and done at the time these instruments were executed and delivered. With fespect to this, Mr. Sevaried, the cashier of the defendant bank, testified: '

“After we had made up this contract Mr. Dom made a settlement, as I remember it. It was getting toward evening. One of them suggested they better go, because it was getting late. They were going out to some supper that evening. They went out of the bank, and Mr. Streeper made some pretense to Mr.- Dorn that he had to see me about ’something else, and he came in and -said, ‘How are going to fix up for my commission?’ I said, ‘Mr. Streeper, of course, you realize all the time that your proposition was this amount to be $500 to pay on the contract,’ and that was considered a small amount on a contract of $12,000, and I said, ‘You realize further that I can’t pay you in cash on your proposition, because it is only $500 that is paid in.’ ‘Well,’ he says, T am badly in need of money, and I ought to have this money to use,’ and I thought around awhile. I have always had very agreeable terms with Mr. Streeper before in our business transactions, and I said to Mr. Streeper: Well, we can fix it this way: I will let you have this money, and you give me your note, and this contract will stand as security to your note, and I will furthermore make that note draw the same rate of interest as your contract is drawing, so that you will be out nothing, not even the interest, when Mr. Dom pays on the contract.’
“Q. In other words, you loaned him the $500? A. Yes, sir.
“Q. And at that time he gave you the note Exhibit 1 ? A. Yes, sir.
“* * * A. Yes, sir.
“Q. I will show you'Exhibit A, and ask you if you drew that *586agreement and turned it over to Mr. Streeper? A. Yes, sir; I did.
“Q. How did you come to do that? A. It came about this way: When I said to him, ‘I will loan you $500, and you give me your note/ I said, T will give you a specific receipt that will show that you have an equity in this contract so that when Mr. Dom pays $500 on his contract, we will not retain the $500.’
“Q. That is the way you would protect Mr. Streeper? A. Yes, sir.”

The defendant on his direct examination testfied as follows:

“Q. Now, isn’t it a fact that you and Mr. Sevaried had' that express understanding that he was selling that land with only $500 paid down? He told you expressly that in view of the fact that there was only $500 ¡•aid, that you would have to take your commission out of the contract as it was paid in money; didn’t he 'tell you that in substance, and didn’t you agree to it in substance ? A: I signed that article.
“Q. You signed that order? A. What order?
“Q. Signed this note. A. What note?
“Q. I asked you this, is it not a fact that Mr. Sevaried said to you in substance this, that, ‘Your man will only pay a small amount in cash; a great bulk of the price has got to be taken out in crop contract, and you must take your chance on commission, the same as we are taking chances on the land; didn’t he tell you that ? A. He told me that, yes, sir.
“Q. And you agreed to it? A. Not in that way.
“Q. Did you or did you not agree to it? Didn’t you agree to accept that commission in that way ? A. With the understanding it should be paid out of that crop.
“Q. Yes. A. Certainly it should be paid out of the crop.
“Q. Yes; your $500 was to. be paid out of the crop to you. A. To* him.
“Q. Through him, but you were to-get the $500 out of the crop. A. He advanced me $500 on that note.”

The undisputed evidence shows that the purchaser, Dom, abandoned the contract shortly after making it, and never produced a crop on the land at all. It is true the evidence shows that there never was a formal cancellation by service of a notice as provided by statute for the cancellation of such contracts. But the undisputed evidence also shows that Dom notified the bank of his intention to abandon the contract.

“Of course, the fact that the contract has not been canceled does not adversely affect the defendant in this case. He still has a $500 equity *587in the contract. This equity is held by the plaintiff bank as security for the note in suit; and, when the note is paid, of course the defendant becomes fully reinvested with all rights in and to said equity free and clear of all claims on the bank. The note in suit by its terms became payable at a specified date. If the purchaser of the land had gone ahead with the contract, put in the crop, and been successful in raising it, there might have been sufficient moneys realized therefrom so that the share coming to the defendant for his commission would have been fully paid, and thereby in turn the note in suit been discharged. That was doubtless what was anticipated by the-defendant and the cashier of tiie bank. It will be noted, however, that the defendant expressly admits in his testimony that he agreed to take chances on his commission the same as the bank took on the purchase price stipulated to be paid by the purchaser for the land.

The note in suit was made payable at a time which would make it possible to utilize any moneys paid by the purchaser (Dom) upon the land contract, and in turn payable to the defendant as commission for obtaining such purchaser, to pay off the note in suit. This, however, did not affect the note. As we construe the evidence, it establishes, without any actual conflict therein, that the note in suit was given for a .sum of money loaned by the bank to the defendant. The note was made payable at a definite time. It has not been paid according to its terms, or at all. In our opinion there was in this case no room for different conclusions as to the material facts. And there was, we think, no basis in the evidence for the verdict absolving the defendant from liability upon the note. We are therefore agreed that the trial court was entirely correct in ordering the verdict to be set aside; and inasmuch as the evidence affirmatively discloses that the defendant has no defense to plaintiff’s cause of action, it would be an idle ceremony to remand the cause for a new trial, and it is therefore ordered that the order and judgment appealed from be, and the same hereby are, affirmed.

Bronson, Birdzell, and Robinson, JJ., concur.