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April 26, 1950


The opinion of the court was delivered by: MURPHY

In this diversity action a Pennsylvania plaintiff sought to recover from defendant, a New Jersey corporation, the principal of a twenty-seven year old unsealed demand note together with 162% interest thereon. The jury, being unable to agree to a general verdict, or to answers to any of four interrogatories submitted by the court, was discharged. Defendant moves for judgment under Rule 50(b), Federal Rules of Civil Procedure, 28 U.S.C.A.

Under the evidence the jury would be warranted in finding:

 That in 1921 defendant borrowed for corporate purposes $ 13,417 at six per cent interest from its President, Alexander Renault, on an unsealed demand note to his order. In 1922 plaintiff acquired the note as sole heir and executrix of her deceased husband's estate.

 In 1924 the president of defendant corporation (John D'Agostino, then sole owner of all the corporate capital stock) orally promised plaintiff that he would personally guarantee payment of the note, and again, orally promised that the corporation would pay it. Nothing was done thereafter for twenty-two years.

 In 1946 plaintiff told the president of defendant corporation (John D'Agostino, then owner of half of share of defendant corporation- the other half being owned by his mother) that she was in need of money. 'He (orally) promised to pay the note off in full' and again ' * * * he said he would send (plaintiff) a check for $ 500.00 immediately and thereafter the company would take care of the note at $ 100.00 a week until it was paid.'

 Commencing May 14, 1946, the corporation sent plaintiff a check for $ 500, June 13, $ 100, July 28, $ 200, and thereafter, usually at weekly intervals, up to February, 1947, twenty-nine additional checks each of $ 100. The checks in the aggregate amounted to $ 3,700. There was nothing whatever in writing indicating any intention of defendant to make payments on the note, nothing on the checks per se to show the purpose thereof except that defendant was the maker and plaintiff the payee.

 Defendant admitted the corporation sent the checks to plaintiff but contended they were in payment for promotional services which plaintiff was engaged by defendant's president to perform for the corporation. When defendant's business declined, plaintiff's services were discontinued and defendant stopped sending checks to plaintiff. The check stubs in defendant's check book for each of the checks sent to plaintiff contain a notation that the checks were issued to cover 'expenses' and 'promotional expenses'. There was nothing whatever on any of defendant's records ante or post litem motam indicating any liability of defendant to plaintiff on the note in question.

 Defendant's president denied making any such guarantee or promise as indicated by plaintiff in 1924; he denied having any conversation whatsoever with plaintiff about the note in question in 1946. Says defendant's president, when he learned of the possible existence of a corporate note in 1924 he demanded that plaintiff surrender it. At the time it was misplaced or lost and plaintiff went to her lawyer, had a release prepared which she signed, sealed and delivered to defendant's president for the purpose of discharging the corporation of all obligation on the note.

 Defendant challenged the validity of the note at its inception; claimed discharge by release; pled the six year statute of limitations; the New Jersey Statute of Frauds; and lack of any authority in its president qua president to bind the corporation by any such promise as plaintiff suggests.

 In the consideration of such a motion we are not to be concerned with the weight or the credibility of the testimony nor may be substitute our conclusions for those of the jury on questions of fact. Cases are not to be taken from the fury except in a strong and compelling situation. See Cheffey v. Pennsylvania R. Co., D.C., 79 F.Supp. 252. It is our duty after viewing the evidence and all inferences reasonably deducible therefrom in the light most favorable to the plaintiff to determine whether or not as a matter of law plaintiff's evidence makes out a case upon which the law will afford relief. Schad v. Twentieth Century-Fox Film Corp. 3 Cir., 136 F.2d 991. And see Meyonberg v. Pennsylvania R. Co., 3 Cir., 165 F.2d 50.

 Jurisdiction of this court being based upon diversity only, we must consider the questions presented as if we were sitting as a Pennsylvania court. *fn1" Under the Pennsylvania rule as to conflicts of law we must look to New Jersey law and apply it to the decision of the various questions presented. *fn2" Where we find no authoritative local decision to be controlling on the precise point we must ascertain and apply what we believe to be the law which a New Jersey court would apply if called upon to adjudicate under like circumstances. *fn3" In determining the question as to the alleged bar of the statute of limitations, under Pennsylvania law we must look to see if the action was fully barred under New Jersey law. *fn4" Defendant being a New Jersey corporation we look to New Jersey law to determine whether D'Agostino had authority to bind the corporation. *fn5"

 From our study of the briefs and an independent investigation of the authorities we feel that the question of the validity of the note *fn6" and of the effectiveness of the release to discharge the corporation *fn7" were questions for the jury.

 Defendant's plea of the statute of limitations presents a nice question upon which counsel have not cited and we have not found a New Jersey or Pennsylvania case precisely in point. Ordinarily an action on a demand note would have to be commenced within six years of the date of execution and delivery. *fn8" However, if proper legal requirements are met, a new promise or acknowledgment, or a payment on account, made after the statutory period has run, has the effect of reviving the obligation of the debtor for an additional six years. *fn9" While Pennsylvania has no similar statute a New Jersey statute, N.J.S.A. 2:24-9, provides, inter alia, ' * * * no acknowledgement or promise by words only shall be deemed sufficient evidence of a new or a continuing contract * * * unless * * * in writing * * * signed by the party chargeable thereby.' ...

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