Gallaher v. Theilbar Realties

Action of Debt ? Payment as Defense ? Giving of Promissory Note as Absolute Payment ? Evidence ? What Does not Create Conflict ? Receipts ? Effect of Receipt as Evidence. Evidence ? What Does not Create Conflict. 1. In an action on an open account to which the defense was payment, neither the statement of a witness for plaintiff that a cash payment and the delivery of a note for the balance did not liquidate the account ? a mere conclusion of law ? nor the one that he did not remember having receipted the bill, created a conflict with defendants testimony that the debt had been paid. Action on Debt ? "Payment" ? Definition ? Mere Delivery and Acceptance of Promissory Note not Payment. 2. In the absence of an agreement, either express or implied, providing otherwise, "payment" means the discharge of a debt or obligation in money; hence mere delivery and acceptance of a promissory note for the amount of an account, whether it be the note of a debtor or of another, does not operate to discharge the debt. - Page 422 Same ? Acceptance of Promissory Note as Payment Under Agreement Discharges Debt. 3. Anything of value may, by agreement, be given by the debtor and accepted by the creditor in satisfaction of a debt; hence where an agreement to accept a promissory note either of the debtor or of a third person is shown, delivery and acceptance thereof will discharge the debt even though thereafter the note be not paid. Same ? What Equivalent of Agreement to Accept Promissory Note as Payment ? Estoppel. 4. The agreement to accept a promissory note in discharge of a debt need not be by express words; if the circumstances and the conduct of the parties show an understanding that the paper was taken in satisfaction of the debt, the creditor is estopped from claiming otherwise. Same ? Effect of Giving Receipt Where Payment Made Partly in Cash and Partly by Giving Promissory Note. 5. Where part payment of a debt is made in cash and the balance is covered by a promissory note, and the creditor gives a receipt as for the full amount in cash, the transaction is a pretty clear indication that the note was given and received as payment. Same ? Payment ? Giving Receipt ? Effect of Receipt as Evidence. 6. A receipt is not a contract and may be explained or contradicted by parol evidence; it is prima facie evidence of payment, and its production in evidence imposes upon the creditor the burden of impeaching it. Same ? Promissory Note Given and Accepted as Payment ? Evidence ? Sufficiency. 7. In an action on an open account the evidence showed that the debtor had paid part of the account in cash and the balance by a promissory note, the bill being stamped "Paid"; the agreement between the parties was that the account should be deemed closed on the books. In an action to recover the amount of the note plaintiff creditor made no attempt to impeach the receipt or explain it. Held, that the judgment, in effect finding that the note was not given and received as absolute payment, was contrary to the evidence.