Norwood v. Stinnett

The plaintiff was, of course, entitled to recover the amount evidenóed by the notes, unless the defendant established the facts of special defense set up in one of his special pleas.

[1, 2] A note may be delivered to the payee with a conditional reservation of liability, which, as between the parties, is effective. Code, § 4973; Bank of Tallassee v. Jordan, 200 Ala. 182, 75 South. 930. Whether there was such a conditional delivery in this case was a question of fact for the jury.

[3] If, as claimed, defendant received the .policies of insurance only for examination, and executed his notes to become effective only in case of his approval and acceptance of the policies, the transaction was strictly analogous to a sale of goods on approval, and the policies never went into operation and effect, and the notes never became an obligation, until defendant approved and accepted the policies, or dealt with them, or kept them such a length of time, without rejection, as would create an inference of fact that he had accepted them. Parker v. Bond, 121 Ala. 529, 532, 25 South. 898.

[4] The case is different from one of sale or return. There the contract is effective until the party who has' the option of disaffirmance actually disaffirms; and the disaffirmance must be within the time stipulated, if any, or within a reasonable time, if none is specified.

[5] Defendant’s special pleas, setting up his right of rejection, do not show any obligation to return the policies upon their rejection by him; and, without such an obligation, his mere failure to return, or to offer to return, them at the time of his rejection of the whole transaction, or within a reasonable time, would not have impaired the efficacy of that rejection.

But defendant’s testimony shows that his rejection of the insurance contracts and his promise to pay therefor imposed upon him the concurrent obligation to return the policies. He was bound to know that so long as he kept them they remained in force as outstanding obligations of the insurance company in his favor, and that in case of his death, while they remained uncanceled, the beneficiary could enforce them against the company. His contract bound him to deliver them up, which he did not even offer to do.

He could not thus retain the policies in force, and at the same time escape the obligation to pay for them, and we are of the opinion that the general affirmative charge should have been given for the plaintiff as requested in writing by him.

[6] Defendant’s plea No. 1, setting up want of consideration, was not subject to the demurrer. Kolsky v. Enslen, 103 Ala. 97, 15 South. 558.

[7] If there was error in sustaining the demurrers to plaintiff’s special replications, it was without prejudice, since he actually had. the benefit of proof of them under the general issue. In this regard, it will suffice to say that a replication, setting up defendant’s obligation to return the policies to plaintiff if they were rejected, and his failure to do so,' or to offer to do so, contemporaneously therewith, would be a good answer to the special pleas.

For the error noted, the judgment ínust be *351 reversed, and the cause remanded for another trial.

Reversed and remanded.