125 Iowa 607 | Iowa | 1904
On July 29, 1898, the defendants E. P. Murphy, W. T. Murphy, and B. F. Derr made and delivered to the plaintiff bank a promissory note for $1,000, payable February 1, 1899. So far as the form of the note and the manner of its execution are concerned, there is nothing to indicate that all were not principal debtors. The note contained a clause reading as follows: “ It is agreed that the signers to this note, whether sureties in fact or not, shall all be regarded as principals as between them and the holder thereof.” This action was begun at law for a recovery upon said note March 8, 1902. Since the making of the note Derr has been adjudged of unsound mind, and appears and defends by guardian. It was first pleaded that Derr was a surety only, as the bank well knew; that the clause above quoted was by mutual mistake left unerased in the printed form on which the note was written; and a reformation of the instrument was prayed. Further pleading, it was alleged that, without the consent of the surety, the bank had from time to time, for a sufficient consider
Counsel advance a theory that the general agreement of Derr to be treated as a principal is limited by another clause in the note, which says that the sureties consent to an extension of time of payment without notice, and that a single extension exhausted the right thus granted; but we think the agreement first mentioned cannot be thus neutralized and rendered mere meaningless surplusage, and the language must be held to mean just what it says. While Mr. Derr was a surety as between him and the Murphys, he was, as to the hank, a principal, with no other or different or greater rights than he would have possessed, had the note been given for his own debt.
For the reasons stated, the judgment of the district court is affirmed.