4 Johns. Ch. 329 | New York Court of Chancery | 1820
This is a motion to dissolve the injunction. The defendant, Rochester, was the endorser of certain promissory notes, for the payment of money, given tQ t])e jjtica Insurance Company, and he became such endorser as a surety for the house of Bond Hatch, who were makers or endorsers, and interested in the notes. This was on the 1st of August, 1817. To indemnify and save him harmless from that responsibility, B. H. gave him a bond of the same date, conditioned for the payment of 7,000 dollars, with a warrant of attorney fo confess judgment thereon. The judgment was confessed, for the better security of the defendant R., and docketted on the 5th of August, 1817. The notes so endorsed, were received 'by the Utica Insurance Company, in payment of debts previously due, being in effect the renewal of former notes then due ; and the manner in which the renewal was made, was the same as that by which regularly incorporated banks usually discount notes. When the notes so endorsed by the defendant R., fell due, they were protested for non-payment, and actions at law were brought against the drawers and endorsers, and judgments obtained in January term, 1819. These judgments are stated to have been justly obtained for moneys loaned by the Utica Insurance Company to the drawers and endorsers of the notes, and by them expended in their business. After the judgment against the defendant R., he sued out an execution on the judgment so confessed to him, in August, 1817. This was done in pursuance of an express understanding between him and B. &f H., that when judgment should be obtained against him upon all, or any of the notes, he had endorsed, he might issue execution, and collect the same under the judgment so confessed for his indemnity. This has been done, and B. IB, who are not parties to this suit, have never complained, and we are to presume, are satisfied" with ' the proceeding. The Utica Insurance Company have no control over the judgment obtained by (he defendant against
The charge now is, that the plaintiff, who is' a stranger to all these antecedent proceedings, and. has no interest in them, having purchased certain lots of B. Sf H., in the village of Rochester, under a junior judgment, of the 30th of January, 1818, against B. Sf H., the defendant R. is now about to seize and sell those lots, under bis prior judgment of the 5th of August, 1817. And what then ? What equity has the plaintiff to enable him to come forward and interrupt the prosecution of the prior legal right and title of the defendant R. ? His ground is, that the notes which were endorsed by the defendant, and given to the Utica Insurance Company, were null and void, because, that company \yere not authorized by their charter to issue bills, discount notes, receive deposits, and carry on other operations as a bank. In August term, 1818, the Supreme Court declared, that the company, by such acts, had usurped a franchise, and on an information in the nature of a quo warranto, judgment of ouster was rendered against them. (The People v. Utica Insurance Company, 15 Johns. Rep. 358.) If the company were not authorized to exercise these banking powers, then the provision of the act, restraining unincorporated hanlcing associations, (Laws, vol. 2. p. 234. sess. 36. c. 71.) is supposed to apply, which declares, that “ all notes and securities for the payment of money, or the delivery of property, made or given to any such association or company, not authorized, &tc., shall be null and void.”
Without discussing the question, how far a want of power in the Utica Insurance Company, to discount notes in the manner they did, might have been a good defence in a suit on the notes, I apprehend that the plaintiff has no right to
The case is much stronger, when we consider that B. and H. are not in Court interposing the restraining act, in bar of a recovery against them. They have confessed judgment, and consent to the execution. It is the plaintiff, who comes in under them, with knowledge of the prior judgment of the defendant, who raises the objection; and it appears to me, that there is scarcely sufficient equity on the face of his bill, to support the injunction, and the answers-put an end to all pretension to it.
It is alleged in the bill, that the defendant is not damnified y but the answer states -a judgment against him as endorser y
. Motion granted.