Empire Coal Sales Corp. v. Platt , 255 A.D. 791 ( 1938 )

— Judgment of the City Court of Mount Vernon, entered upon the verdict of a jury in favor of the defendant, reversed on the law, with costs, and judgment directed for the plaintiff, with costs. The action was on a promissory note. By payments the amount due thereon was reduced to $400. The defendant resisted the payment of that amount upon the ground that three months prior to the giving of the note an arrangement had been made whereby an allowance was given to the defendant for $400 on account of an alleged breach of warranty growing out of the sale of coal to him, the sale price of which coal constituted the consideration for the note. There was no claim that the note was delivered subject to a condition precedent or that it was the product of fraud or mistake. The evidence that such an adjustment or arrangement had been made three months prior to the giving of the note was improperly received. (Jamestown Business College Assn. v. Allen, 172 N. Y. 291.) Here, if there were a partial failure of consideration, the failure did not occur after the giving of the note. Therefore, section 54 of the Negotiable Instruments Law is of no avail to the defendant. There is no claim that there was an absence or failure of consideration prior to the giving of the note, but unknown to the defendant until after the giving of the note. Lazansky, P. J., Carswell, Davis, Johnston and Taylor, JJ., concur.