54 Neb. 566 | Neb. | 1898
Andrew Miles and James W. Yinton, executors of the will of John L. Miles, deceased, and James Thompson brought this action against Nathan Merriam, Charles T. Brown, Patrick Egan, and H. J. Cosgrove to recover on eight promissory notes for $1,000 each, executed by the defendants to William M. Clark and transferred to John L. Miles and James Thompson. Of the defendants, Merriam alone was served with process. As a defense he pleaded that the notes were made to Clark in part payment for a tract of land purchased jointly by the makers, and were secured by mortgage on the land purchased, which was afterwards platted into lots as an addition to Lincoln; that, before the notes were sold to Miles and Thompson, Merriam, *Egan, and Cosgrove sold their re
It is asserted on behalf of the plaintiffs that, unless the holder was a party to the agreement, or afterwards ratified it and accepted the new liabilities thereby created, he was not bound in any respect thereby, and could for all purposes continue to treat all the parties to the instruments as principals and deal with them on that basis. We do not think that so broad a statement of the law is warranted by reason or the authorities, although some cases are found which go to that extent. The doctrine has been frequently recognized by this court that, where one buys land incumbered by a mortgage, and covenants to pay the mortgage debt, or as part of the consideration assumes the payment thereof, his promise creates a principal obligation which the mortgagee may enforce against him. (Cooper v. Foss, 15 Neb 515; Keedle v. Flack, 27 Neb, 836; Rockwell v. Blair Savings Bank, 31 Neb. 128; Reynolds v. Dietz, 39 Neb. 180; Grand Island Savings & Loan Ass’n. v. Moore, 40 Neb. 686; Meehan v. First Nat. Bank of Fairfield, 44 Neb. 213; Green v. Hall, 45 Neb. 89.) It follows, as a logical consequence, that thereupon the vendor becomes in effect á surety, and the vendee the principal debtor, that is between themselves. (Paine v. Jones, 76 N. Y. 274; Huyler v. Atwood, 26 N. J. Eq. 504; Flagg v. Geltmacher, 98 Ill. 293.) Of course there can- be no change without the knowledge and consent of the mortgagee which can affect
The case therefore turns on the fact of notice, and we shall treat the averment quoted from the reply as putting that fact in issue, and examine the evidence to ascertain AA’hether the special finding thereon is sustained by the evidence. It appears that the notes sued on had passed from (lark, the payee, to the Clark & Leonard Investment Company, and that five of them were some months overdue. Brovra desired an extension thereof, and himself arranged with Miles and Thompson to buy them and grant the extension. He paid Miles and Thompson about $1,000 as a bonus to induce them to purchase the notes and grant the desired extension. After this was negotiated a representative of the investment company took the notes to Omaha and there the transfer was completed, the written agreement for an extension being made the same day and evidently as a part of the same transaction. Brown negotiated both the sale and the .extension, and it was his desire for the extension that led him to bring about the sale. This contract for the extension recites the purchase by Miles and Thompson, “this day,” of the notes in suit and one other, and that “Charles T. Brown is the present
It is asserted that the extension had been granted before the notes were sold; that the written contract was merely evidence of a ratification thereof by the purchas
Reversed and remanded.