34 N.Y. 440 | NY | 1866
Lead Opinion
This case was correctly disposed of by the court below. The testimony shows, without dispute, that the makers of the note executed it for the accommodation of the corporation, at the request of its president, who, by the by-laws, was its general agent. Their position was, therefore, that of co-sureties for the company, and they were jointly and severally liable to pay the whole amount of the note to the payee, but, as between themselves, each was liable to pay one-fifth of the whole and no more. The former liability was created by the express terms of their contract; *442 the latter is implied by law from the fact of their becoming bound together as sureties.
The counsel for the appellant insists, however, that this general implication of law is repelled by the peculiar circumstances of the present case, and that, as the makers of the note were themselves the only solvent and responsible stockholders of the corporation, their engagement was not one of suretyship, but was, in fact, an undertaking to pay a debt owing by themselves as a corporation, and it is, therefore, to be implied that they intended to be liable therefor in proportion to the amount of stock held by them respectively.
That position is untenable. It assumes that the makers of the note thereby undertook to increase their individual liability as stockholders, in proportion to the amount of stock held by them respectively; and not only that, but also that they assumed a further liability, in like proportion, to the extent of the stock held by Gillett, who was insolvent, and was not a party to the note. They did neither. They signed the note as individuals, and not as stockholders or trustees of the corporation.
The judgment should be affirmed.
Concurrence Opinion
The plaintiff, the defendant and three others made their joint and several promissory note to George Christie for $3,050, payable at six months with interest. Christie was a creditor to that amount of the Jefferson Leather Manufacturing Co., was dissatisfied with his securities, and required a note, such as was given, as above stated. The parties to the note were stockholders in the leather company in unequal amounts. That company became insolvent, and is now practically dissolved. The note was given as security for the company, and expressed nothing upon its face different from an ordinary note signed by five parties jointly and severally.
The plaintiff paid the note to Christie, and claims of the defendant one-fifth of the amount now due upon it. The defendant claims that, as stockholders in the company, they stand as partners in this transaction; that the plaintiff must bear such portion of the loss, compared with defendant, as *443 his stock bears to defendant's; that is, the proportion of five to one.
This claim cannot, I think, be sustained. The leather company was the principal debtor: the five individuals named give their note for its debt. They act here and in this as individuals, and the legal effect of their contract is, that they will each be liable to the creditor for the whole amount of the note, and each will be liable to any one of themselves paying the note, for the one-fifth of the amount so paid by him. The parties made no arrangement altering this liability between themselves; although it was quite competent for the defendant to have given or required a writing, which would have limited his liability to the proportion of his stock.
The parties were stockholders and corporators in the institution named, but not partners either legally or equitably, and not subject to any other liabilities than those imposed by the statute. It is suggested that a different rule was established in the case of the Rossie Lead Mining Co. There, however, the charter expressly provided that "the stockholders of said corporation shall be jointly and severally personally liable for the payment of all debts contracted by the said corporation or their agents." (Moss v. Averill, 6 Seld., 489.) The various cases cited by the appellant arose under that charter.
The judgment should be affirmed.
Judgment affirmed. *444