43 Neb. 596 | Neb. | 1895
The Farmers & Merchants Bank of Humboldt was incorporated under the laws of this state in July, 1879, and thereafter was engaged in the business of banking at Humboldt until in June or July, 1889, when the bank closed and made an assignment for the benefit of its creditors. Creighton Morris was appointed assignee, who qualified as such. Negotiations were soon thereafter had between the officers and stockholders of the bank and the creditors for the purpose of effecting a settlement or compromise of the claims of the creditors. A proposition was finally made to the creditors to pay them 90 cents on the dollar of their claim within two years, the creditors to throw off all interest accruing after September 19,1889. This proposition was favorably received by nearly all the persons who held claims against the bank. The following paper was prepared and presented to the creditors for their signature:
“The undersigned, creditors of the Farmers & Merchants Bank of Humboldt, Nebraska, being desirous of effecting a compromise and settlement-of all differences touching the liability of the several stockholders of said bank, hereby severally agree to discount the sum of ten (10) per cent from the face of each of our respective claims, as the same may be filed, proven, and allowed before the county court of Richardson county, Nebraska, and to forbear the collection of interest accruing thereon after September 19, 1889; provided the stockholders of said bank shall, on or before said 19th day of September, 1889, convey and assign unto Creigton Morris, receiver for said bank, all of the property held by them, or either of them, as trustees of said bank, and shall file with said county court a good and sufficient bond, conditioned that said stockholders shall, on or before October 1, 1889, pay unto*600 the receiver appointed by the court for said bank the sum of twelve thousand two hundred ($12,200) dollars, and soon thereafter as all the assets in the hands of the receiver shall have been converted and disbursed, and within two (2) years thereafter, at farthest, shall pay unto the said receiver such further sum of money as shall suffice to liquidate, in full, all of the claims allowed by the court against such bank, without interest after September 19, and alter deducting from the face of such claims a discount of ten (10) per cent as above provided. Dated this 13th day of August, 1889.”
. The foregoing instrument, after being signed by all the creditors of the bank excepting three or four, who refused to sign, was delivered to Creighton Morris, the assignee, and the following bond was also executed and delivered to-said Morris:
“Know all men by these presents, that we, W. W. Turk, Barney Mullen, J. C. Eurgus, Wm. N. Nims, A. L. Ery, R. A. Stewart, T. J. Frazier, A. R. Nims, and R. C. Lamberton are held and firmly bound, jointly and severally, unto Creighton Morris, receiver for the Farmers & Merchants Bank, of Humboldt, Nebraska, in the penal sum of twenty-five thousand dollars ($25,000), good and lawful money, for the payment of which, well and truly to be made unto the said Creighton Morris, receiver, and to his-successors, we jointly and severally bind ourselves, our heirs, executors, and administrators.
“Witness our hand and seals this twenty-fourth day of August, A. D. 1889.
“The conditions of this obligation are such, that whereas certain differences have existed between the creditors of the said Farmers & Merchants Bank and the stockholders of said bank touching the liability of such stockholders-toward such creditors; and whereas one of the conditions of such compromise is that the stockholders of said Farmers & Merchants Bank shall, on or before the first day of*601 October, 1889, pay unto the receiver appointed by the-court for said bank the sum of twelve thousand two hundred dollars ($12,200), and, within ninety days after all the assets in the hands of the receiver or assignee shall have been converted and disbursed, shall pay unto said receiver such further sum of money as shall' suffice to liquidate in full all of the claims proven and allowed by the-court against such bank without interest after the 19th day of September, 1889, deducting from the face of each said claim -a discount of ten per cent, said amount of ninety-per cent to be paid creditors net over and above the expenses of the assignee and the court proceedings. The entire amount of ninety per cent to be paid within two years-from October 1, 1889:
“Now, therefore, if said stockholders of the Farmers & Merchants Bank aforesaid shall well and truly pay, or-cause to be paid, unto said receiver the said several sums-of money at the times and in the manner herein above recited, these presents shall become null and void, otherwise-to remain in full force and eflect.
“Done in the county of Richardson and state of Nebraska.
“W. W. Turk. [seal.]
“Barney Mullen, [seal.]
“J. C. Fergus. [seal.] “¥m. N. Nims. [seal.]
“--. [seal.]
“--. [seal.]
“T. J. Frazier. [seal.]
“A. R. Nims. [seal.]
“R. C. Lamberton. [seal.]”
On the 12th day of January, 1892, this action was-brought by the defendant in error for the use and benefit of, and as trustee for, the creditors of the bank upon the-foregoing bond against each of the signers thereof. The return on the summons discloses that W. W. Turk, A. R..
The petition alleges, substantially, the incorporation of <the bank; that it made an assignment for the benefit of its •creditors; that the defendants were incorporators and stockholders of said bank; and that it, for more than a year prior to the incurring of the indebtedness from the bank to its creditors, had wholly failed to give the notice required by section 136 of chapter 16 of the Compiled Statutes; that by reason thereof the stockholders were individually liable for the debts of the bank; that on the 24th day of August, 1889, a settlement and compromise was made between the defendants and certain creditors of the bank, whose names are set forth in the petition, by which the latter should receive hinéty cents on the dollar of their ■claims and the defendants were to have two years in which to pay the same. The petition sets out a copy of the paper signed by the creditors heretofore mentioned, together with the names and amount due each of the persons signing the same; alleges that the proposition contained in said paper was accepted by the defendants, and, in consideration of said extension of time and the discount of ten per cent and interest said defendants executed and delivered ■to the plaintiff the bond set out above, and which is copied into, and made a part of, the petition. The petition further avers that the persons who signed said bond have paid the sum of $12,200 therein mentioned, and delivered to the plaintiff the property held by them in trust as therein stip
A motion to strike out of the petition, as redundant and irrelevant, the averments therein relating to the failure to give the notices of the indebtedness of the bank and of its incorporation was filed, which motion was overruled by the court, and an exception was entered upon the record. " A demurrer to the petition was interposed on the following grounds: (1) That the petition does not state facts sufficient to constitute a cause of action; (2) that it does not appear there was a sufficient consideration for the bond sued upon; that said bond shows upon its face that it was never signed by the obligors therein named and that it was never completed or became a valid and binding obligation. The demurrer was overruled, and thereupon the defendant answered, denying all the averments of the petition not expressly admitted; admitted the incorporation of the bank;
The reply denies every allegation in the answers not expressly admitted; admits that two stockholders did not execute the bond, and that four creditors did not sign the other paper nor accept the terms of the compromise, and that they have brought suits against the stockholders as stated in the petition; alleges that the defendants, with
A trial was had at the June term, 1892, which resulted in a verdict for the plaintiff for the sum of $19,552.15. This verdict the court set aside on motion of the defendants, and at the November term following there was a second trial with a verdict and judgment for the plaintiff in the sum of $21,148.75. The defendants have brought the same to this court for review.
The first assignment of error relates to the overruling of the demurrer to the petition. The contention of counsel is that the petition is insufficient and fatally defective, in that the bond on which suit was brought shows on its face that it was intended to be executed by the nine persons named in the body thereof as principals, but that it was only executed by seven of them. It is argued by counsel for defendants that for this reason the bond was incomplete and invalid, and there can be no recovery against those who signed it. It is firmly established by the decisions that when one signs a joint bond as surety upon conditions that others are to sign the same with him, and it is delivered without such condition being complied with, the bond cannot be enforced against the one so signing as surety, unless the obligee had no notice of the condition, or it be established that the surety, after signing, waived the condition. (Cutler v. Roberts, 7 Neb., 4; Sharp v. United States, 4 Watts [Pa.], 21; Fletcher v. Austin, 11 Vt., 447; Hall v. Parker, 37 Mich., 590; Lovett v. Adams, 3.Wend. [N. Y.], 380; State v. Peper, 31 Ind., 76; People v. Bostwick, 32 N. Y., 445.) It is equally well settled that when such
Is there any presumption that such a bond is incomplete and unfinished, until executed by all the parties whose names appear in it as obligors? Upon this point the authorities are not harmonious. The following cases hold that no presumption arises that such a bond was not considered as binding until the signatures of all the obligors named in the body have been obtained, but on the contrary its execution is deemed prima facie complete, and it is for the defendants to establish that they signed on the express condition that (hey were not to be bound until all the obligors named in the instrument should sign : Dillon v. Anderson, 43 N. Y., 231; Parker v. Bradley, 2 Hill [N. Y.], 584; Haskins v. Lombard, 4 Shep. [Me.], 140; Cutler v. Whittemore, 10 Mass., 442; Johnson v. Weatherwax, 9 Kan., 75; Johnson v. Baker, 4 Barn. & Ald. [Eng.], 440. Some of the authorities which hold that the presumption is such instrument was not to be delivered until all had signed are: Sharp v. United States, supra; Clements v. Cassilly, supra. We are inclined to the doctrine that the instrument is prima facie binding. This presumption may be overcome by proof that such bond was not to be binding upon the one who signed until the signatures of all have been attached. The bond under consideration in this
The objection to the petition that it does not appear that there was any consideration for the giving of the bond is-without merit. It is alleged in the pleading, and recited in the bond, in effect, that the creditors of the bank discounted their claims to the extent of ten per cent, threw
The overruling of the motion to strike out certain allegations of the petition as redundant is made the basis of the second assignment in the petition in error, but as it is not relied upon in the briefs, this assignment will be deemed waived. (Gill v. Lydick, 40 Neb., 508: Glaze v. Parcel, 40 Neb., 732.)
Complaint is made in the brief filed of numerous decisions of the trial court on the admission of the testimony of several witnesses whose names axe given. We cannot consider any of these rulings, because they are not sufficiently raised by the petition in exTor. The only assignment therein which could be construed as relating to the rulings just mentioned is the sixth, which is in the following language: “Because of errors of law occurring at the trial, excepted to at the time by the defendants below.” In Murphy v. Gould, 40 Neb., 728, an assignment in a petition in error, in substantially the same language, was held insufficient to secure a review of the rulings of the court below on the .admission of testimony. We adhere to that decision.
The next, and the most important question presented by the record for consideration is whether the penal sum of -$25,000, named in the bond, is the maximum limit of the liability which the obligors assumed. The general rule deducible from the authorities in this countxy is that on the breach of a penal bond the obligee may recover his actual damages sustained, not exceeding the penalty named in the bond, or the penalty and interest, there being some conflict .in the cases whether interest is allowable or not. (Fraser v. Little, 13 Mich., 195; Spencer v. Perry, 18 Mich., 393;
The case of Spencer v. Perry, supra, is much like the one at bar. That was an action upon a bond in the penal sum of $6,000, conditioned for the payment by the defendant of all the debts of the firm of Spencer & Newcombe, and to indemnify the plaintiff, one of the firm, against such debts. Subsequent to the execution of the bond the defendant paid the debts of the firm to an amount exceeding the penalty of the bond. The court held there could be no recovery, since the voluntary payment by the defendant of the debts of the firm equal to the penalty was the satisfaction of the bond. Christiancy, J., in de
Our conclusion is, not considering the question of interest, that the penalty is the limit of liability of the obligors for a breach of the conditions of the bond. As already stated, the decisions are not harmonious upon the proposition of allowing interest beyond the penalty. The decided weight of authority sustains the doctrine that where the damages sustained exceed the penalty, interest may be recovered from the time the condition of the bond was broken, or the damages became due. (2 Sedgwick, Damages, sec. 678, and cases there cited; Sutherland, Damages, sec. 478, and note 2.) The true principle — one supported by the better authorities, and which we adopt — is that interest is recoverable in this kind of an action.
We will not review the instructions given and refused, because the assignment in the motion for a new trial relating thereto is insufficient, the assignment of error being substantially the same as in Hiatt v. Kinkaid, 40 Neb., 178. Objection is likewise made to certain instructions on the ground that they are not numbered. The point is properly raised in the motion for a new trial and in the petition in error, but no exceptions were taken to the instructions on the ground that they were not numbered when read to the jury, hence the objection is waived. (Gibson v. Sullivan, 18 Neb., 558.)
It remains to be considered whether the damages assessed by the jury are excessive. The record shows that the amount of the claims of the creditors, as allowed by the county court, aggregated more than $45,000, without the discount of ten per cent stipulated in the bond, or over $40,000, after deducting the ten per cent. It further appears, without conflict, that the defendants have made cash payments, after the bond was signed, and prior to the bringing of the suit, aggregating the sum of $13,200, less the amounts given as credit on account of the two claims we are
Objection has been made that payment is not an issue presented by the pleadings. There is no room to doubt that payment, to be available as a defense, must be pleaded, and, if denied, must be proved. (Clark v. Mullen, 16 Neb., 481; Van Buskirk v. Chandler, 18 Neb., 584.) It will be
Judgment accordingly.