Stewart v. Tipton

Morrison, C. J.: The complaint in this case contains two counts, the first of which is upon the following instrument in -writing :

“ Red Blufe, October 28th, 1875. “Received of John J. Stewart $2,750 on deposit, payable on return of this certificate properly indorsed, by giving twenty days’ notice, at one per cent, per month.

“ Tipton & Burtt.”

The complaint contains all the averments necessary to charge the defendants upon the above instrument, and the defense is a composition agreement entered into by plaintiff and other creditors of the defendants.' The agreement relied upon is as follows :

“For value received, we severally agree with Tipton & Burtt of Red Bluff, California, to take the promissory notes of said Tipton & Burtt for the several amounts due us, at the rate of fifty cents on the dollar, which said promissory notes shall be payable, one-lialf in eighteen months, and one-half in [53]twenty-four months, and shall be payable in United States gold coin, and bear interest at the rate of one per cent, per month.

“ This agreement is made by each of us, in order that Tipton & Burtt may so reduce their indebtedness as to be able to resume business at Bed BlufE.”

The second count is founded upon an indebtedness from the defendants to the Bed BlufE Mill Company, which was assigned to the plaintiff. To this count the same defense was interposed. The agreement above set forth was signed by sixty-six creditors of the defendant, among whom were the plaintiff and the superintendent of the Bed Bluff Mill Company. The case was tried by the Court, and one of the findings is, “ that the defendants were always ready and willing to make and deliver to the plaintiff and the said company their promissory notes, according to the terms of said agreement, whensoever the plaintiff and said company should surrender up and cancel the demands sued on in this action ; but the plaintiff and said company afterwards refused to comply with their said agreement and' surrender up their said claims, and thereby prevented the defendants from performing their part of said agreement.” And the conclusion of law found by the Court is, “ that the demands upon which the action is brought were canceled at the time the agreement was signed.” Defendants had judgment.

The only evidence in the case on this point was that of the defendant J. C. Tipton, and ho testified that'the defendants had always been ready and willing to execute and deliver the notes, and take up the indebtedness for which they had been given, according to the terms of the agreement. On cross-examination, however, he said : “ That he had never asked or requested the plaintiff or the Bed Bluff Flour and Milling Company to surrender up the demands mentioned in the complaint, nor did the defendants make out or offer the notes to, and demand the surrender of said indebtedness, according to the terms of the agreement, or otherwise.” Bo tender or demand was ever made, to his knowledge. It further appears from the evidence of the same witness, that the defendants opened and resumed business for four or five days after the agreement was signed,.and then made an assignment to secure certain preferred creditors, agreeing to pay them sixty-two and a half cents on the dollar. It also