30 N.C. 56 | N.C. | 1847
This is an action of assumpsit and was tried on the general issue. The case appeared to be as follows:
The plaintiff and defendant were cosureties for Jesse W. Lee in a promissory note to Peter Pelletier for $497.25. The Plaintiff was indebted to Lee on a note $492.30, payable 20 March, 1840. After those notes had fallen due, it was ascertained that Lee was unable to pay all his debts, and was insolvent; and it was agreed between him and Hall that the former should surrender to the latter his note for $492.30, and that he (Hall) should pay the amount due on it in discharge of the debt to Pelletier, and Lee immediately delivered to Hall his (57) note.
At that time Hall was also the surety for Lee for a debt of $114.05 to Moore Jackson, and a cosurety with three other persons in a note of $1,000, held by one of the banks; and, shortly after, having received his note from Lee, the plaintiff ascertained that these latter debts were subsisting, and that he would be liable on them; and in consequence thereof he came to a new agreement with Lee on 15 September, 1840, that the *52 sum due on Hall's note should be applied, pro rata, to the debt to Pelletier and the other debts for which the plaintiff was a surety as aforesaid. On 16 September, 1840, Robinson, the defendant, received effects from Lee to the value of $128.20, and gave Lee his engagement to pay that sum on the debt to Pelletier. Afterwards Hall was compelled by execution to pay Pelletier his whole debt, principal, interest, and costs; and then he brought this suit for contribution.
The court instructed the jury that after deducting a pro rata share of Hall's debts to Lee, the plaintiff was entitled to recover one-half of the residue of the sum paid to Pelletier, and also one-half of the sum of $128.20, which the defendant had promised to pay on that debt. The jury found, accordingly, for the plaintiff, and assessed the damages to $238.97, and from the judgment the defendant appealed. The Court is of opinion that the jury was not properly instructed. It seems clear that the plaintiff was entitled to recover the whole of the sum received from Lee by the defendant. It is a fund provided by the principal for the payment of his debt, which the defendant undertook to pay (58) on it, and did not, but left the plaintiff to pay the whole debt. It is true the plaintiff had before received from the principal a sum nearly, if not quite, sufficient to discharge the debt, and that he received it for that purpose; and it was insisted for the defendant that, as between the plaintiff and him, the debt was to be considered as paid from the time the plaintiff received that fund, and, therefore, that the plaintiff could not recover anything unless it might be one-half of the excess, if any, of the amount due on the note to Pelletier over that due on the note of Hall to Lee. Although that might have been the result had the case stood on the first transaction between Lee and Hall, yet it cannot be admitted when that and the subsequent transactions are considered together. For, though it may be true that Lee and Hall, after appropriating the money in Hall's hands to the debt to Pelletier, could not change its destination, to the prejudice of the defendant, yet before it was paid to Pelletier it was certainly competent to them to deal with it as suited themselves, as far as such dealing did not affect the interest of third persons. Now, the agreement to divert to other purposes a part of the fund held by Hall could not prejudice the defendant, if its place was supplied by the deposit of an equal *53 fund in his own hands. To the extent of the sum received by the defendant the agreement for applying a part of the debt of Hall to the satisfaction of other debts for which he was bound was rendered a just and proper agreement, and the plaintiff did, and could do, no wrong to the defendant in so applying that part. That left in his hands, applicable to Pelletier's debt, $128.20 less than he paid on it, and he might have his action against Lee therefore; and as the plaintiff cannot effectually recover against him, this action lies against the defendant, who received that sum for this debt, and cannot in conscience, and ought not in law, to keep it.
But the Court is further of opinion that the recovery (59) was right in respect only of that sum of $128.20, and beyond that is erroneous.
Before the act of 1807 the remedy between cosureties was in equity only. That act does not enlarge the rights of the surety who pays the debt nor deprive the cosurety of any just grounds of defense which would before have been available to him. It was intended merely to change the jurisdiction, or rather, to enlarge that of the Courts of law — not upon any arbitrary principle, but, for the amendment of the law, giving a less expensive and more expeditious remedy by action in addition to that given in equity. As far as the jurisdiction is concurrent the right of recovery and of defense should be the same in both Courts. It has been held, indeed, that, from the necessity arising out of the imperfection of the jurisdiction of a court of law, the act cannot be extended to the complicated case of the insolvency of one or more of the sureties, when they exceed two, but that it restricts the recovery to an aliquot part of the debt, according to the number of the sureties. Powell v. Matthis,
recovered but what ex equo et bono the defendant ought to pay, as far as his defenses are, in their nature, examinable in a Court of law.
Having arrived at the foregoing conclusion, it is not difficult to adjust the right and liabilities of these parties. The relief between cosureties in equity proceeds upon the maxim that equality is equity, and that maxim is but a principle of the simplest natural justice. It is a plain corollary from it that when two or more embark in the common risk of being sureties for another, and one of them subsequently obtains from the principal an indemnity or counter-security to any extent, it inures to the benefit of all. The risk and the relief ought to be coextensive. Moore v. Moore,
Those equitable principles have been already incorporated into the law of this case by an adjudication in an action founded on the statute. Fagan v. Jacocks,
PER CURIAM. Judgment reversed, and venire de novo.
Cited: Pool v. Williams, post, 288; Draughan v. Bunting,