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Leary v. Gledhill

Decided: November 26, 1951.

THOMAS A. LEARY, PLAINTIFF-RESPONDENT,
v.
WILLIAM L. GLEDHILL, DEFENDANT-APPELLANT



On appeal from the Law Division of the Superior Court.

For affirmance -- Chief Justice Vanderbilt, and Justices Case, Oliphant, Wachenfeld, Burling and Ackerson. For reversal -- None. The opinion of the court was delivered by Vanderbilt, C.J.

Vanderbilt

From a judgment of the Law Division of the Superior Court entered on a jury verdict in favor of the plaintiff the defendant appealed to the Appellate Division of the Superior Court. We have certified the appeal on our own motion.

The plaintiff and the defendant were friends who had become acquainted while in the military service. They first

met in 1943 and occasionally thereafter through 1945. They corresponded but did not meet again until Christmas, 1948, when the defendant visited the plaintiff in Germany where he was stationed. At that time the defendant was no longer in the military service but was in Europe attempting to sell tractors for the Franam Corporation. Prior to the defendant's trip to Europe he had corresponded with the plaintiff with reference to an investment in the Franam Corporation as one which would be very profitable. Their correspondence resulted in the plaintiff purchasing $1,000 worth of stock when the defendant went to see him in Germany, the defendant delivering to the plaintiff certificates of stock which he had brought with him to Europe in exchange for the plaintiff's check for $1,000.

In April, 1949, the plaintiff at the defendant's invitation visited him in Paris. The defendant had left the United States with $500 in his possession and after arriving in Europe had been in constant need of money to meet his expenses. In a conversation in a hotel in Paris the defendant told the plaintiff that he needed about $4,000 and that he could raise about $2,000 by selling his Cadillac car. In the plaintiff's presence the defendant made a telephone call to his wife in the United States and instructed her to sell the automobile. The defendant asked the plaintiff to help him, but did not mention anything about selling the plaintiff any shares of stock. The plaintiff said he would think it over for a few days and see what he could do. After returning to his base in Germany the plaintiff mailed the defendant a check payable to the defendant's order for $1,500 without indicating on the check or in the accompanying letter what the money was for. The defendant endorsed the check and converted it into traveller's checks. The parties did not see each other again until the day of the trial, although the plaintiff had made many attempts to see the defendant after they both had returned to the United States, seeking him at his home and calling him on the telephone at various times, but always without success.

The plaintiff instituted this suit against the defendant on two counts, the first for $1,000 and the second for $1,500, but at the outset of the trial the plaintiff moved for a voluntary dismissal of the first count and the pretrial order was amended accordingly. The issue as stated in the amended pretrial order was limited to whether the money given by the plaintiff to the defendant was a loan or an investment in a business venture. At the trial the plaintiff testified that the check for $1,500 was a personal loan to the defendant but this the defendant denied, contending that he had never borrowed any money from the plaintiff. At the end of the plaintiff's case and again at the end of the entire case the defendant moved for an involuntary dismissal on the ground that the plaintiff's proofs were insufficient, there being no promise to repay, no demand for repayment, and no pleading or proof of the law of France where the transaction occurred. These motions were denied, the trial court holding that while it would not take judicial notice of the law of France it would proceed, first, on the presumption that the law involving loans is the same there as in other civilized countries, and, secondly, on the ground that the issue with respect to the law of France had not been set forth in the pretrial order. When the case was submitted to the jury, the defendant objected to the charge on the ground that it did not instruct the jury to find as a fact what the law of France was. The jury returned a verdict in favor of the plaintiff in the sum of $1,500, and from the judgment entered thereon the defendant took this appeal. It is significant that the defendant never proved or even attempted to prove either the delivery of any stock to the plaintiff or a tender thereof. Neither did the defendant attempt to prove or even suggest that the law of France was such as to preclude recovery in the circumstances.

The defendant argues five points on this appeal, none of which has merit:

1. "The motion to dismiss should have been granted where the complaint alleges an express contract of loan and

there is a failure to prove a promise to repay." A loan may be established by a contract implied in fact as well as by an express promise; the only difference between the two is the kind of evidence used to prove the undertaking. At the oral argument the defendant relied on Allen v. Bunting, 18 N.J.L. 299 (Sup. Ct. 1841) holding that a note or a check in the hands of the maker or drawer after payment at the bank, instead of being prima facie evidence of so much money lent, is only prima facie evidence that the maker or drawer was indebted to the payee at the time he gave the note or check and that it was given in satisfaction of that specific debt. It is difficult to see how this ruling as to the prima facie effect of a cancelled check in the plaintiff's hands aids the defendant in view of the testimony given at the trial concerning defendant's need of $4,000 to pay his expenses, his instructions to his wife by trans-Atlantic telephone to sell his Cadillac car for $2,000, and his request to the plaintiff for a loan, followed by the ...


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