Smith v. Rice

27 Mo. 505 | Mo. | 1858

Richardson, Judge,

delivered the opinion of the court.

The doctrine may be considered as settled in this state— where law and equity are administered in the same form and in the same suit — that a judgment does not extinguish the relation of principal and surety; (Morton v. Rice, 19 Mo. 263;) and the same causes that will discharge a surety will discharge an endorser. (Bank U. S. v. Hatch, 6 Pet. 250.)

The entry in the record in the case of the plaintiff against Sigerson in the circuit court, on the 19th November, 1857, by which the plaintiff consented and agreed that execution on the judgment should be stayed, ought to stand on as high ground as an agreement of a like kind under seal, and is certainly evidence of a valid contract. The plaintiff put it out of his power to sue out execution before the first Monday of October, 1858, and the record entry operated as a valid contract for delay whereby the plaintiff suspended his remedy against the principal for a stipulated- period. The plaintiff had no right to receive payment of the judgment from Rice before October, 1858, because he had agreed with Sigerson to wait until that time ; and if Rice had paid the judgment he would not have been entitled to immediate recourse on Sigerson, because the latter could not be compelled to pay the endorser any sooner than-payment could have been demanded by the creditor; for, having secured an extension of time by a valid contract with a person authorized to make it, he would not lose the benefit of the indulgence by the premature payment of the debt by the endorser.

The principle on which the surety is discharged, when an agreement to give time for a sufficient consideration is made by the creditor and the principal debtor, is very clearly stated by Chancellor Kent, in King v. Baldwin, 2 Johns. Ch. 559: “ The surety is entitled to pay the debt when it becomes due, or he may call upon the creditor, by the aid of this court, to enforce his demand against the principal debtor. On paying the debt, he is entitled to the creditor’s place by substitution ; and if the creditor, by agreement with the principal debtor without the surety’s consent, has disabled himself from suing when he would otherwise have been entitled to sue under the original contract, or has deprived the surety on his paying the debt from having immediate recourse to his principal, the contract is varied to his prejudice and he is consequently discharged.”

In this case the plaintiff could not proceed on the original debt, because it was merged in the judgment; and he could not enforce the judgment, because he had agreed to stay the execution. The courts will not inquire whether the delay has in fact been injurious, for the presumptive injury to the surety is sufficient to exonerate him. (Hoffman v. Hurlbert, 13 Wend. 377.) In the case for 6 Pet. 250, the Bank had instituted suit against the drawer of a bill of exchange, and the attorney of the Bank having made an agreement for a valuable consideration with the defendant that the suit should be continued without judgment until the term after that at which judgment would have been entered, it was held that the endorser was discharged.

The other judges concurring, the judgment will be affirmed.