Clarke-Woodward Drug Co. v. Hot Lake Sanatorium Co.

Opinion by Mr. Chief Justice Moore.

1. It is contended that the execution of the promissory note by the defendant to R. L. Sabin for a sum which included the demands of the plaintiff precludes it from maintaining this action, and for that reason errors were committed in directing a verdict for the plaintiff and in rendering the judgment given herein. “Nothing,” says Mr. Chief Justice Lord, in Black v. Sippy, 15 Or. 574 , “is better settled than that accepting a note is not payment of an account, nor is accepting one note in renewal of another payment of the old note, unless there is an agreement that the note should be accepted in payment.” To the same effect, see Kern v. Hotaling, 27 Or. 205 ( 40 Pac. 168 , 50 Am. St. Rep. 710 ); Johnston v. Barrills, 27 Or. 251 ( 41 Pac. 656 , 50 Am. St. Rep. 717 ); Schreyer v. Turner Flouring Co., 29 Or. 1 ( 43 Pac. 719 ); Savage v. Savage, 36 Or. 268 ( 59 Pac. 461 ); Kiernan v. Kratz, 42 Or. 474 ( 69 Pac. 1027 , 70 Pac. 506 ); Stringham v. Mutual Ins. Co., 44 Or. 447 ( 75 Pac. 822 ); Cranston v. West Coast Life Ins. Co., 63 Or. 427 ( 128 Pac. 427 ).

2. The defendant’s agent who executed the promissory note did not testify that the written instrument *239 was given in payment dr discharge of the claims that had been left with Sabin for settlement, or that any agreement was entered into in respect thereto. Sabin, however, stated upon oath that the note was given and accepted, not as payment, bnt as a convenient means of adjusting the items of the various accounts that were in his possession. There was no conflict in the evidence as to whether or not the promissory note was given in liquidation of the plaintiff’s account, and hence in an action thereon it was not erroneous, on this branch of the case, to direct a verdict for the plaintiff: Jackson v. Brown, 102 Ga. 87 ( 29 S. E. 149 , 66 Am. St. Rep. 156 ).

3, 4. It is insisted that the capital stock issued by the defendant to the plaintiff was a novation which extinguished the original debt with all the rights incident thereto. A “novation” is a substitution of one obligation for another, and occurs by the exchange of a new party for an old, or by the commutation of a new agreement between the old parties, or it may be a simultaneous change both of parties and of agreement: Miles v. Bowers, 49 Or. 429 ( 90 Pac. 905 ). Prom the testimony it appears that no exchange of obligations was fully consummated, and hence no substitution was accomplished for the reason, as was said by Mr. Justice Burnett in Sharp v. Kilborn, 64 Or. 371, 375 ( 130 Pac. 735, 736 ):

“It was at best an abortive novation inaugurated by the defendant, in which was wanting one requisite essential to bind the plaintiff, namely, the consent of the plaintiff himself.”

It is evident, we think, that no novation ever occurred. The evidence shows that on March 25, 1913, the plaintiff received the certificates of capital stock *240 that had been issued in its favor, but refused to accept them because the Loyal Order of Moose had not purchased the defendant’s property as its agent had represented, upon the faith of which declaration the plaintiff’s agent had relied when it was generally understood that such evidence of corporate indebtedness would be issued in liquidation of the accounts as evidenced by the promissory note.

5. The plaintiff’s agent testified that the stock was held for some .time at the request of the defendant’s agent, pending negotiations for a sale or disposition of the Hot Lake Sanatorium, and when no transfer thereof was made the stock was sent to the defendant’s agent, who returned it, and thereafter this action was instituted. It is argued that the defendant was not immediately placed in status quo, and, this being so, an error was committed in rendering the judgment.

It is evident, we believe, that the delay which occurred in the respect mentioned was caused by the defendant’s agent, so that no change of position resulted to either party in consequence thereof.

At the trial after the plaintiff had introduced its evidence and rested, and while a witness for the defendant was testifying, the court remarked that the jury would be instructed to find for the plaintiff; to which observation an exception was taken. Before a verdict was returned, however, the defendant introduced all the testimony it had to offer. It is argued that in thus determining the issues an error was committed.

6. When there is no conflict in the evidence and no presumptions or inferences can be deduced in aid of the defeated party, there is nothing to submit to the jury, and the question is one of law to be decided by the court: Coffin v. Hutchinson, 22 Or. 554, 557 ( 30 Pac. 424 ). In that case Mr. Chief Justice Strahan, *241 in announcing a rule by which to determine when a jury should be directed to find in favor of a party, says:

“A fair test in such case is, if the jury, in the absence of a special direction, were to find a verdict the other way, ought it to be set aside?”

To the same effect, see Squires v. Modern Brotherhood, 68 Or. 336, 347 ( 135 Pac. 774, 778 ), where the decisions of this court on that subject are collated.

Prom a careful examination of all the testimony given at the trial, a transcript of which is made a part of the bill of exceptions, it is evident that the jury were properly directed.

It follows that the judgment should be affirmed, and it is so ordered. Affirmed. Rehearing Denied.

Mr. Justice Burnett, Mr. Justice Bean and Mr. Justice Harris concur.