140 P. 501 | Ariz. | 1914
The plaintiff in error sued the defendants in error to recover upon the following promissory note:
“4000.00. Douglas, Arizona, Jan. 30, 1908.
“Twelve months after date, for value received, we promise to pay to the order of William Cowan four thousand no/100
“PRANK RAMSEY.
“Mrs. PRANK RAMSEY.
“PETER JOHNSON.”
The defendant answered that he received no part of the money for which the note was given, and that he ‘ ‘ only signed and executed the said note as surety, and not as a principal maker thereof, all of which was at the time then and there, and ever since has been, known to plaintiff. ’ ’ That the plaintiff, the holder of note, without the knowledge or consent of defendant, had on June 28, 1911, after note was due and payable, bound himself by agreement with the principals on said note, Prank Ramsey and Lula Ramsey, to extend the time of payment, and had by such agreement postponed his right to enforce the payment of said instrument. There was a trial to the court, with judgment for defendant.
The question is as to whether the matters set up by defendant constitute a defense. In other words, is the defense of extension of time of payment by the holder of a negotiable promissory note to the principal available to an accommodation comaker when the extension is granted without his consent, under the negotiable instrument act? Title 36, Ariz. Rev. Stats. 1913.
Under the law-merchant or common law affecting commercial paper, “a definite and binding agreement between the holder and the maker or acceptor of commercial paper extending the time of payment will discharge the surety thereon, including a joint maker who is in fact a surety or accommodation maker, to the knowledge of the holder, . . . unless he consents to the extension, or is estopped, or waives the right to set up a discharge by a binding agreement after the extension.” 7 Cyc. 882; McGlassen v. Tyrrell, 5 Ariz. 51, 44 Pac. 1088. The defendant’s answer, therefore, is a
"We think the answer failed to state a defense.
The judgment is reversed, and the cause is remanded for further proceedings not inconsistent with this opinion.
FRANKLIN, C. J., and CUNNINGHAM, J., concur.