5 N.Y.S. 745 | N.Y. Sup. Ct. | 1889
I think the plaintiff has established that he executed the note for the accommodation of Chase without consideration, and that Chase, having obtained a discount of the note for his own benefit, became the principal debtor, and plaintiff became his surety. See Bank v. Wood, 71 N. Y. 410. The note in question having been transferred by Chase to the defendant bank for a valuable consideration, that bank became entitled to enforce the same against the maker, and it appears that the plaintiff has paid the amount of that note to the bank. The bank, however, holds certain securities deposited with it by Chase under an agreement that the same should be held by the said bank as a security, and to protect them against any loss by reason of Chase’s dealings with the bank. The bank was entitled under this arrangement to hold all of the securities deposited with it by Chase until all the moneys owing by Chase to the bank, and losses sustained by the bank in consequence of its dealings with Chase, should be repaid. Plaintiff, however, would have the right, upon payment to the bank of the amount for which it held the securities mentioned as collateral security, to be subrogated to the rights of the bank, and to hold the securities held by the bank as security for the repayment of the amount that he had been compelled to pay upon the note and the debt due to the bank by Chase. This right, however, he could enforce only upon payment to the bank of the total amount due it, and it is only upon payment of such an amount that he can enforce the right of subrogation. The plaintiff in this action does not allege that plaintiff lias paid or offered to pay to the bank the amount due to it by Chase, nor is there any evidence that such payment or tender of payment has been made. The action, however, is made in equity. Plaintiff’s position is that of surety, and not as an original debtor on the note in question. The amount due to the bank was uncertain, and under such circumstance I think the plaintiff had a right to come into a court of equity, and ask that the amount due to the bank should be ascertained, and that upon the payment of that amount that he be subrogated to the rights of the bank to hold the securities deposited with the bank by Chase as security for the repayment of the amount paid by him as surety; and in actions of this