For reversal and remandment -- Chief Justice Weintraub, and Justices Jacobs, Francis, Proctor, Hall, Schettino and Haneman. For affirmance -- None. The opinion of the court was delivered by Francis, J.
Plaintiff Dr. Thomas Mahoney sued defendants Morris Minsky and Robert W. Caverly, individually and as partners trading as Bellevue Surgical Supply Co. on the following note:
Two months after date we promise to pay to the order of Dr. Mahoney seven thousand dollars.
Bellevue Surgical Supply Co.
The making of the note was admitted; the defense was payment. After trial a jury returned a verdict for plaintiff plus interest in an uncomputed amount. Although the question of allowance of interest had been submitted to the jury, the trial court exscinded that portion of the verdict, saying equity demanded a denial of interest. Defendants appealed from the adverse judgment; plaintiff cross-appealed from the disallowance of interest. The Appellate Division affirmed the recovery on the note. It held also that plaintiff was entitled to interest from the due date of the note, and remanded the cause to the trial court for entry of an appropriate judgment. We granted defendants' petition for certification. 38 N.J. 316 (1962).
The Appellate Division was correct in declaring that plaintiff's award should include interest. In the absence of express provision to the contrary, a liquidated obligation of the type involved here carries conventional interest from the due date, as a matter of course. It is compensation for the use of, or hire of, money. Knight v. Barnwell, 130 A. 736, 3 N.J. Misc. 1128 (Sup. Ct. 1925); 1 Restatement, Contracts, § 337, p. 542 (1932); McCormick, Damages, § 54, p. 213 (1935); and see, Uniform Commercial Code, L. 1961, c. 120, § 3-122(4); N.J.S. 12A:3-122(4).
The circumstances attending the giving of the $7,000 note and its alleged payment are in sharp dispute. Plaintiff said that at various times between 1944 and 1948 he had made loans to defendants in $500 amounts, taking an individual note on each occasion. By 1948 he held 10 such notes which (he asserted) were consolidated into one note for $5,000, payable in one year. In 1951 he accepted a substitutionary three-year note for $6,000, which included $1,000 for past due interest. On October 1, 1954, in lieu of payment, the obligation was replaced by a note for $7,000 payable in two months. The new instrument, the subject of this suit, represented an additional $1,000 agreed upon as interest.
Defendants denied the claim of a series of notes culminating in the $7,000 obligation. They acknowledged borrowing
$7,000 from plaintiff on October 1, 1954 but insisted they received it in cash on that day. In support of their position, they produced their bank statement for October 1954 which shows a deposit of $7,000 on October 1. It was marked for identification but was declared inadmissible by the trial court. We agree with defendants that the ruling was erroneous. The statement issued by the County Bank & Trust Company, Passaic, and captioned in defendants' trade name, Bellevue Surgical Supply Co., appears perfectly regular on its face and as having been issued in the regular course of business prior to the inception of any controversy between the parties. In a case where the issue of credibility was crucial, this ante litem motam instrument obviously furnished competent and relevant corroboratory evidence for defendants and should have been received.
Defendants further testified that the $7,000 received from plaintiff on October 1, 1954, after being deposited, was used to pay off an outstanding note of theirs in that amount held by the same bank. In support of the testimony, a check dated October 1, 1954 for $6,994.17 to the County Bank & Trust Company, drawn on the Bellevue Surgical Supply Co. account there, was produced, as well as the $7,000 note stamped "Paid, October 1, 1954." Both documents were rejected as evidence. They should have been admitted for the very reason which supplied competent probative force to the bank statement. On their face they were natural and routine incidents of the $7,000 transaction with plaintiff as described by defendants. Their virtue as evidence lies in the fact that they, too, antedated this litigation by about five and one-half years and represented conduct occurring when the parties were close friends and their relations were harmonious. The weight to be given to all three of the described documents was for the jury to determine.
Plaintiff testified that in July 1959 he spoke to defendant Minsky about paying the note, and was told that the partners would get together and make an adjustment. Thereafter he became ill and ...