110 Ky. 579 | Ky. Ct. App. | 1901
Opinion op the court by
Reversing.
Appellee was sued, with J. 0. Garriott and E. M. Garriott, upon a promissory note to appellant for $1,132.24, dated August 8, 1892, maturing four months thereafter, with credit indorsed, “Interest paid to Dec. 8, 1893, $90.57.” J. C. Garriott was the principal; the other two, sureties. 'J. C. is a son of E. M. Garriott. E. M. Garriott paid one-half the note after suit, and made no defense. J. C., the principal, is insolvent. Appellee pleaded numerous matters in defense, all of which were disallowed by the court, being held insufficient on demurrer, save three, as follows: (.1) That when appellee signed the note it had been signed by the two Garriotts, and had been accepted by appellant, the bank, and there was therefore no consideration for his signature; (2) that after the maturity of the note the principal, J. C. Garriott, had more than enough money >on deposit with appellant to pay the note, and it failed to apply same on the note, and thereby appellee was discharged; (3) that said principal had placed a lot of notes belonging to him with -appellant for collection, with direc
On the -trial the evidence for appellee (he, of course, having the burden) in support of the first plea allowed by the court was, in substance, that J. C. Garriott, the principal, being required by the bank to renew the note, procured his father, E. M. Garriott, to sign it with him, telling him that another brother would als'o sign it, but, instead, being in a hurry, he took the note to the bank and delivered it to' the cashier, saying that appellee would sign it, and requesting the cashier to call appellee’s attention to it. Appellee testified that the cashier called him
On the trial appellee was permitted to prove, over appellant’s objection, that appellee was comparatively a poor man, his whole estate subject to execution, being his home in Shelbyville, worth some $2,500 after deducting incumbrances, and perhaps an equity in some, other real property of no great value, all probably acquired since the creation of appellee’s liability, and that E. M. (Harriott was a wealthy man, — that is, was worth, anyhow, from ten to fifteen thousand dollars, — and that the cashier of appellant bank was his son. The only possible theory upon which the foregoing was admitted as relevant was to show that the bank had in fact accepted the note before appellee signed it, and that, therefore, as to appellee, it was without consideration; for it was probably supposed the bank would accept a solvent note without reference to, or wanting for the signature of, an insolvent surety. On the contrary, the effect of the testimony on this line must have had the contrary legal effect; for allowing another to sign after the obligation had become complete might operate to release the surety who had signed, because of the consequent change of the contract between the bank and him, and therefore the evidence would more strongly
As from the foregoing it is apparent that the case must be returned to the lower court for a retrial, it is proper to here consider the legal value of the pleas made in paragraphs 6 and- 7 of appellee’s answer, and disallowed by the court. The effect of these pleas is, if allowed, to •permit appellee to plead for his co-surety a defense personal to the latter, and of which he declines, for whatever reason, to avail himself. That appellee could rely on any defense of the principal is without question. Why? Because he has engaged to be answerable only for the legal liability of the principal on the undertaking. Therefore anything that gave the principal legal release is goad as the suretj-’s defense. But is such his liability to his co-surety? The only liabilities to the co-surety, independent of special agreement as between themselves, were not of contract, but are imposed by the law; that is, to divide, in proportion to their original liability, any indem
So far as the paper executed by Adams and others, and charged to be the act of the bank, is concerned, we are of opinion that it is invalid as a defense to appellee, for at least two reasons: (1) It does pot appear to be the act of the bank, but the act of the parties who signed it, as their individual undertaking; nor is it alleged that the bank had agreed with them, for a consideration, to assume the obligation, or that it authorized them to so obligate it. (2) If it is the act of the bank, and could be so treated, then it appears to be without consideration; for, E. M. Garriott having paid -but one-half of the sum for which he appears legally bound, the. obligee’s agreement, in consideration of such payment, — it being past due, — to release him from the residue, is not of binding force, for there would be no consideration to' support it. From the foregoing it follows that the circuit court did not err in sustaining the demurrers to the paragraphs named, but that it did err in admitting the testimony criticised herein, as well as in not giving the peremptory instruction asked for. The judgment is reversed, and the cause remanded for proceedings consistent herewith.