69 Md. 352 | Md. | 1888
delivered the opinion of the Court.
The promissory note which is the foundation of this action, reads thus: “Baltimore, March 10th, 1886— .8515.00. Four months after date I promise to pay to the order of Isaac Frazer, five hundred and seventy-five dollars at 47 Lexington street, value received— (signed,) A. A. Reinhart.” This note was endorsed “ Isaac Frazer,” “Michael Schall,” and at the trial the words “pay to the order of Michael Schall” were written over Isaac Frazer’s name. The note was discounted at Bank. Frazer failed. Reinhart did not pay the note at maturity. Schall paid the note to the Bank, took it up and now sues the maker for it.
Reinhart contends that Schall is not a bona fide holder for value; and that he was a guarantor of the
Being mercantile paper, the appellee was bound to-the Bank as endorser, and having paid it he is entitled to recover from the maker the whole amount of the note, unless there be something in the transaction to change the relation of the parties to each other, so as to absolve the appellant, either in whole or in part, from liability.
Where several person-s endorse a bill of exchange or negotiable instrument, the legal effect is to subject them to each other in the order in which they endorse; the legal inference being that the payee is the prior endorser. This may be rebutted, and the relation of the parties towards each other may be shown, by evidence, to be other than that which the law presumes it is from the character of the instrument and the order of endorsement. Whatever the intention may have been, it will prevail if proven. Daniel on Negotiable Instruments, secs. 703 and 704, and Wood vs. Repold, 3 H. & J., 125. In any of these presumptions and aspects there is no difference between accommodation notes and those negotiated for value. Wood vs. Repold, 3 H. & J., 125; Yates vs. Donaldson, 5 Md., 400 ; Shaw vs. Knox, 98 Mass., 214. “Every endorser,” says Judge Buchanan in Wood vs. Repold, “ is considered in law as
There is not the slightest evidence that the parties did not design their relation to this instrument, to be exactly what its form and the order of endorsement import. If Schall intended to be bound as guarantor, of course, what the parties intended will control; but, as already stated, in the absence of proof that he intended to be a guarantor, or to assume a joint liability with the appellant, the presumption is that he intended to bind himself as endorser. Story on Prom. Notes, secs. 479 and 480. The only proof on the subject is, that Erazer told Schallu“ this was business paper which he wished to get discounted, and he could not get the money on it without an” additional endorser “owing to a rule of the Bank requiring two endorsers, and he went on the note as security.” That means just what Judge Buoiianan states the effect of the'endorsement to be, he was becoming a several security to whoever discounted that paper. There is no evidence showing he suspected it even to be other than an actual debt of Reinhart's. He says he paid it as endorser, to the Bank after it had gone to protest for non-payment. It is clear there was no understanding or agreement between the parties that Schall was becoming guarantor
Contending that the note was procured from him by fraud, the appellant insists, that, under the decision of Totten vs. Bucy, 57 Md., 446, and Crampton vs. Perkins, 65 Md., 22, Schall loses the benefit of the presumption in his favor, and is put to the proof that he is a bona fide holder for value, and for this reason urges there was error in the refusal of the Court beloAv to grant his second prayer, Avhich asked the Court to instruct the jury that if they found the note was procured by fraud from the appellant, they must find for the defendant (appellant) unless they found “Schall was a bona fide holder of said no.te for valuable consideration, without notice of such fraud, and the jury are instructed that the burden is on the plaintiff to prove that he is a bona fide holder of said note for valuable
The first prayer of the defendant asked that the jury should be instructed that if they found the plaintiff was a guarantor, they should find for the defendant. We have already said that if there was evidence that there was an agreement, and an intention that ho should become guarantor he would he so treated; but there was no evidence tending to rehut the legal inference supplied by the order of endorsement, and the express statement of Schall, and therefore the prayer was rightly rejected. For the like reason the fifth prayer relating to joint liability was properly rejected. The fourth was contradictory of the legal inference the paper supplied, and could not he granted.
The plaintiff's prayers being consonant with the law of the case as we have already stated, were properly granted. The judgment must he affirmed.
Judgment affirmed.