STORY OF A PROMISSORY NOTE.

Poverty Bay Standard, Volume XI, Issue 1308, 12 April 1883, Page 3

STORY OF A PROMISSORY NOTE.

r (From the New Zealand Times.) Asr interesting question came before the Resident Magistrate at Wellington the other day, Mto whether a promissory note can be qualified in its force or limited in its effect by an outside understanding put in writing, but not forming part of the note itself, The question was practically this: Does a promissory note come within the usual rule by which a written contract is interpreted, ■ namely, that no writing or understanding outside the written stamped contract shall be held to qualify that contract, neither limiting nor enlarging its effect ? If it were otherwise a promissory note might be nullified or materially changed by some subsidary contract which aid not appear on the promissory note, and would therefore be concealed from those parties who might receive such promissory note for value in the ordinary course of business. In the case before Mr • Hardcastle a promissory note had been given to Mr Compton, timber merchant, and endorsed by Mr Love, who was the real debtor. A written memorandum had been made at the time, signed by Mr Compton, to the effect that he thereby undertook to renew the bill from time to time, as Mr Love might require, Part of the promissory note was x ptid, and the promissory note was then ref newed for the reduced sum, which happened Sbe £5O. Before this renewed bill matured r Love asked for a further renewal and tendered £6, as being all he could spare, Mr Compton would renew it on payment of £lO, reducing the debt by that sum, Mr Love still offered only £6, insisting that he had a right to renewal so long as he paid some portion of the debt. The parties could not agree on this point, and the bill for £5O not being met at maturity, Mr Compton (or rather bis eon, who now held the bill) sued Mr Love for the £5O, and also for interest on the amount since the date of maturity. Mr Gully argued the case for the plaintiff, >-Mr Ollivier, who appeared for the defendant, "••contended that, on the written understanding, the option lay with the defendant as to how much he should py bay way of reducing the debt at each renewal ; and that he had a clear right to renewal “ from time to time " as often as he pleased, by paying any portion of the original debt Having tendered £6 when asking for a renewal, he was acting within the written understanding by insisting on renewal, and by not paying the whole bin at maturity, That was the legal argument, Mr Hardcastle, R.M., made short work of this doctrine, ruling that a contract is not to be governed by some written under, standing outside the four corners of the stamped contract; and he gave a verdict for plaintiff for the full amount and costs,