69 S.W. 112 | Tex. App. | 1902
This action was brought by Clara Wagner and others against Max Borschow and his wife Sarah Borschow, Louis W. Levy, M. Rosenberger, and I. Hauser, the said Hauser both personally and as trustee in bankruptcy for the said Max Borschow, and against M.S. Ujffy, as trustee in a deed of trust, to recover the amount of certain promissory notes given for the purchase money and the cost of improvements upon lot No. 12, the east half of lot No. 13, and the west half of lot No. 11, in block No. 338 in the city of Galveston, which had been sold by the plaintiffs to Borschow and wife. A foreclosure was asked of the vendor's lien and that of the deed of trust given by Borschow and wife to M.S. Ujffy as trustee to secure the payment of the notes. Judgment was also sought against the defendants Levy, Hauser, and Rosenberger upon their agreement to indorse and as the indorsers of three of the notes, one by each of them. Pending the suit Hauser and Rosenberger paid the notes indorsed by them. The result of the suit was a judgment in favor of the plaintiffs establishing the liens claimed against the property for the sum of $12,160.57, being the balance of principal, interest, and attorney fees due upon the notes sued on, but provided that process should not issue against the property of Sarah Borschow, wife of defendant Max Borschow, nor against him, as he had been discharged in bankruptcy since the making of the notes and creation of the liens sued on. It was also adjudged that Levy owed plaintiffs $641.28, being, according to the decree, the amount of the note for $576, dated June 14, 1899, due twelve months after date, with interest at 8 per cent per annum, $65.28, total, $641.28, which note he *99 had refused to indorse. The decree, however, provided that no execution should issue against Levy's property unless the land and improvements should sell under the foreclosure for less than $6013.20, in which case execution should issue against Levy for the difference between $6013.20 and the amount realized from such sale, not to exceed the said sum of $641.28. The other orders contained in the decree are formal and need not be recited. There is no statement of the facts in the record, and the questions here presented are raised by assignments of error upon exceptions to the action of the court in sustaining demurrers to the defenses pleaded by the defendant Levy. The petition alleged the sale of the lots to Borschow at $3000 and the advancement to him of $5000 for the construction of improvements thereon, and in consideration thereof the execution of twelve promissory notes by Borschow to the plaintiff for the principal amount and interest included to the maturity thereof; and further alleged that by a contract in writing one Jake Davis and the defendants Levy, Hauser, and Rosenberger, each of them agreed in the order named to indorse one of the four notes maturing first, the said notes being for the sum of $576 each and due respectively six, twelve, eighteen, and twenty-four months after date; but that when the note to be indorsed by the defendant Levy was presented to him for indorsement he declined to indorse the same. He was sued both as an indorser and upon his agreement to indorse. His defenses to which demurrers were sustained in the court below are summarized as follows: (1) That the liability of the defendant Levy was secondary, and that the plaintiffs had no recourse against him except for a deficiency remaining after the application pro rata to this note and the others of the proceeds of the sale of the property upon which the lien had been retained. (2) That the estate of Borschow, who had been adjudged a bankrupt, had paid a dividend of about 40 cents on the dollar on the indebtedness proved against him, and that plaintiffs could and would have collected from 35 per cent to 40 per cent on their claim if they had taken steps to obtain such payment, which they wholly failed to do. (3) That after the defendant Levy declined to indorse said note plaintiffs could and should have required Borschow to procure another indorser, and should have endeavored' to make the amount thereof out of other assets of said Borschow; that it was the duty of plaintiffs to use ordinary prudence and care to avert or lessen a loss resulting from a breach of the agreement, the terms of the answer being that by using proper or ordinary care plaintiffs could have fully protected themselves against defendant's alleged failures to indorse. The contract by which the defendant Levy agreed to indorse the note was exhibited as a part of the petition. It set out the terms of the sale to Borschow and described the twelve promissory notes that were to be executed, and recited that all were to be secured by vendor's lien and mechanic's lien or otherwise as determined by the vendors of the parcels of land; and further that, "whereas it being desirous to have the first four of said notes indorsed by some reliable party for further *100 security, now therefore, know all men by these presents, that we, the undersigned, agree and will indorse said M. Borschow's notes, respectively, when presented to us as follows: * * * Second note of $576 payable twelve months after its date, etc., by (Signed) L.W. Levy." This agreement was dated February 16, 1899. It appeared from the averments of the petition that afterwards, on or about March 11, 1899, the plaintiffs, relying upon said agreement, consummated their trade with Borschow.
The defendant Levy was sued both as an indorser and upon his agreement to indorse, and so far as any questions arising upon the record are concerned, it is immaterial whether the suit be regarded as one against him as an indorser of the note or upon his agreement to indorse it, for in case of breach of an agreement to indorse the measure of damages would be the same as for a recovery upon the indorsement, and the defenses pleaded by him are, we think, equally inapplicable to both forms of actions. If he had indorsed the note his liability would have been that of a surety, since the agreement was to indorse for the purpose of furnishing security. 1 Dan. Neg. Inst., sec. 713b; Cook v. Southwick,
Affirmed.
Writ of error refused.
