Delaware County NyArchives Court.....Thomas, John Vs. Van Buren Thomas 1889
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Source: Reports Of Cases - New York
Written: 1889

Fourth Department, May Term, 1889.


JOHN THOMAS and VAN BUREN THOMAS, Respondents v. MILO SCUTT, Appellant.

Bill of sale — when it constitutes a contract, which cannot be varied by parol 
evidence tending to show it to be a mortgage.

Where the owner of chattels, to secure an indebtedness owing by him, has 
executed to his creditor a mortgage thereon, and subsequently gives to such 
creditor a bill of sale thereof, in which latter instrument are apt and absolute 
words of conveyance, and by which a definite consideration is agreed to be paid 
for the property mentioned therein (the respective prices for each of several 
classes of property being specified), and it is further provided that the said 
price shall apply on the amount due on said chattel mortgage, "it is not 
competent for the creditor, who has accepted such bill of sale, to offer parol 
evidence to prove that prior to, and at the time of drawing the bill of sale the 
debtor refused to make an absolute disposition of the property, and that such 
was not the intention of such bill of sale; that the bill of sale was given 
simply to secure the indebtedness, and that the debtor was to have the full 
benefit of the proceeds of sale of said lumber when made, after paying his debt 
and the expenses of marketing it.

Marsh v. McNair (99 N. Y., 179) followed.

Such an instrument is more than a mere assignment, it constitutes a contract in 
writing within the rule which prohibits parol evidence to explain, vary and 
contradict such contracts.

Appeal from a judgment in favor of the plaintiffs, entered in the office of the 
clerk of Delaware county March 9, 1888, upon the report of a referee.

Action to recover for "lumber, timber, scantling and boards had and received by 
the defendant of plaintiffs, sold and delivered, and for which he promised and 
agreed to pay." The answer, among other things, sets up "that all the lumber had 
by the defendant of the plaintiffs was had under and by virtue of an agreement 
which the plaintiffs had failed to fulfill on their part, and that by virtue of 
the terms of the agreement the defendant is not liable to account for the same." 
Certain counter-claims are also set up. Plaintiffs, are lumbermen residing in 
the town of Hancock. Defendant is a store-keeper residing in the same town. In 
the spring of 1884 the plaintiffs were the owners of a raft of lumber, called 
the Peas Eddy raft, then in their possession and lying in the town of Hancock. 
The defendant took and disposed of it, and the plaintiffs have had a recovery 
for the value thereof, less twenty-three dollars and ninety-one cents, the 
balance of an account found to be due the defendant from the plaintiff.

Much evidence was taken upon the trial, in respect to the items of dealing 
between the parties, extending over a series of years. March 29, 1883, the 
plaintiffs owed the defendant about $1,303.13, and for the purpose of securing 
that amount, and certain advances, to be made by the defendant, prior to the 1st 
of May, 1883, the plaintiffs executed a chattel mortgage to the defendant upon a 
large quantity of lumber in the sum of $1,600. Upon June 11, 1883, the 
plaintiffs executed and delivered to the defendant a bill of sale, which was 
attached to a copy of the chattel mortgage, which is in the following 
language: "For the consideration hereinafter named, we hereby sell, assign, 
transfer and deliver to Milo Scutt, one raft of hemlock toggle timber, and 
loading thereon, now lying at Equinunk Eddy, just below the rock, in Buckingham 
township, Pa., the said lumber being covered by a chattel mortgage, of which the 
mortgage hereto attached is a copy, viz.:

"The same to apply on the amount due on said chattel mortgage, and if any 
mistake in amount of lumber, same to be corrected. 
"Dated June 11, 1883.
"4,000 feet of cherry boards, at $12 . . . $48 00 
"35,000 maple plank, about, at $10 . . . . 350 00 
"11,000 feet of toggle timber, at 3c . . . 330 00
                                          $728 00    

"JOHN THOMAS,
"For John and Van Buren Thomas."

On June 18, 1883, the plaintiffs paid to the defendant the sum of $865,52, which 
paid up the chattel mortgage debt, if the sum of $728 named in the bill of sale 
be applied thereon. July fifth a charge was made against the plaintiffs by the 
defendant for twenty-three dollars and ninety-one cents, when the dealings 
between the parties ceased. The defendant claimed, however, a balance due him, 
and by reason thereof took possession of the Peas Eddy raft of lumber. The 
plaintiffs insisted they were not indebted to defendant, and on different 
occasions, in the spring of 1884, they sought a settlement with the defendant 
and offered to pay any balance, but such settlement was not had, and defendant 
took possession of the property owned by the plaintiffs. Apparently the 
defendant was not fortunate in handling the property covered by the bill of 
sale, and after allowing it to remain through the summer months in Philadelphia, 
he finally sold it for fire-wood, and his position upon the trial was that the 
plaintiffs, and not he, should sustain the loss.

H. & W. J. Welsh, for the appellants.

J. B. Gleason and A. Taylor, for the respondent.

Hardin, P. J.:

After the plaintiffs had given evidence of the cash payments made upon the 
chattel mortgage and read the bill of sale in evidence, they took the position 
that the defendant's chattel mortgage had been paid, and that the defendant had 
no title to or interest in the lumber mentioned in the complaint; that having 
taken and converted the same to his use he was indebted to the plaintiffs 
therefor. To controvert this position the defendant insisted upon the trial that 
the bill of sale was executed and delivered as a collateral security, or that 
the same was a conditional sale. The defendant put a witness upon the stand who 
drew the bill of sale, upon which occasion one of the plaintiffs and the 
defendant were present. To the witness the defendant propounded the question, 
viz.: "State what was said between the parties in reference to the bill of 
sale?" This was objected to on the ground that it was immaterial and improper, 
and that the writing is the best evidence and cannot be contradicted or avoided 
by parole. Thereupon the defendant avowed that he "intends to show that Exhibit 
B (bill of sale), was given as security only." Thereupon the objection was 
sustained and the defendant excepted. Then the defendant proposed "to prove by 
this witness that, prior to and at the time of the drawing of the bill of sale, 
the plaintiffs refused to make an absolute disposition of the lumber; that they 
were informed that such was not intended, but that the raft was in Pennsylvania, 
and that the chattel mortgage did not protect defendant against a levy upon or 
disposition of the lumber by the plaintiffs in that State; that plaintiffs 
should have the full benefit of the lumber and what it brought on the sale when 
marketed, after paying the plaintiff's claim and the expense of running and 
marketing it; that plaintiffs said they were satisfied with that and would make 
the bill of sale on this basis, and thereupon did sign the bill of sale." 
Plaintiffs stated the same grounds of objection as have been mentioned above, 
and the objections were sustained and the defendant excepted.

After the defendant had been examined as a witness, and near the close of the 
evidence in the case, the plaintiffs moved "to strike out all that part of the 
evidence of Milo Scutt as to what occurred between him and John Thomas with 
reference to the bill of sale of June 11, 1883, prior to and down to the time of 
the execution of the bill of sale, on the ground that parol evidence cannot be 
given to contradict or vary the terms of that instrument." This motion was 
objected to by the defendant "on the ground that the evidence tends to show a 
conditional sale and is not inconsistent with and does not dispute the bill of 
sale; that the motion extends to the acts of the parties, and is not limited to 
what was said." The motion was granted and the defendant excepted. These two 
rulings present the principal question involved in the appeal now before us. It 
was conceded at the trial that the defendant took possession of the property 
under the bill of sale. That instrument stated the consideration to be $728 for 
the property mentioned therein, and that the plaintiffs thereby did "sell, 
assign, transfer and deliver" to the defendant. The words of transfer were 
absolute; the price for each class of property was mentioned, and the total 
price of the property was therein stated to amount to $728. It then contains an 
agreement between the parties, mutually, as to how the $728 should be paid or 
credited between the parties. Their contract was in precise words, definite and 
certain, with no ambiguity. The bill of sale used this language, after a 
statement of the price of the lumber at $728, viz., "the same to apply on the 
amount due on said chattel mortgage." "We, therefore, see, by an inspection of 
the instrument, that the plaintiffs agreed to sell for $728, and the defendant 
agreed to buy for that amount, and to apply that amount upon the chattel 
mortgage which he held against the plaintiffs. By the terms of the instrument 
the precise consideration upon which the property was transferred is specified, 
and it is stated that the defendant shall apply that sum upon the chattel 
mortgage.

We think the language of the court in Marsh v. McNair (99 N. Y., 179), is 
applicable to the bill of sale. In that case the court said: "This instrument is 
more than an assignment. It contains what both parties agreed to do. It shows 
that the assignment was made for the purposes mentioned, and precisely what 
Gibson was to do in consideration thereof. He became bound to do precisely what 
was specified for him to do, and he could have been sued by the assignors for 
damages if he had failed to perform. Hence the instrument is not a mere 
assignment or transfer of the policy. It is a contract in writing within the 
rule which prohibits parol evidence to explain, vary or contradict such 
contracts."

Applying the language laid down in Marsh v. McNair (99 N. Y., 179), we are of 
the opinion that the rulings made by the referee, rejecting the evidence offered 
and striking out the evidence that had been received, tending to show that the 
bill of sale was taken as collateral security, were correct. The writing itself 
was the highest controlling evidence of the contract between the parties. (Long 
v. Millerton Iron Company, 101 N. Y., 638; Eighmie v. Taylor, 98 id., 288; 
Renard v. Sampson, 12 id., 561; Shaw v. Republic Life Insurance Co., 69 id., 
286.)

We are of the opinion that the referee committed no error of law in refusing to 
find that the parties had waived the force and effect of the bill of sale. What 
credence should be given to the testimony of the defendant as a witness was a 
question for the referee to pass upon; besides his testimony upon that subject 
was largely contradicted by the testimony of the witness Van Buren Thomas. There 
was much conflicting evidence given in respect to the property taken by the 
defendant and its value. After a careful consideration of the evidence on either 
side of the question that is involved, and after giving the findings of the 
referee their proper influence, we are of opinion that we ought not to disturb 
the same by holding that they are unsupported by evidence or contrary to the 
weight of the evidence.

Judgment affirmed, with costs.

Martin and Merwin, JJ., concurred. 

Judgment affirmed, with costs.

Additional Comments:
Reports of Cases Heard and Determined in the Supreme Court of the State of New 
York. Marcus T. Hun, Reporter. Volume LIX, 1889, HUN 52. Banks & Company, 
Albany, NY. 1901.

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