Alexander Rey, William Marshall, and Joseph Marshall Partners Under the Name, Style and Firm, of Marshall Co Plaintiffs In Error v. James Simpson
| Decision Date | 01 December 1859 |
| Citation | 16 L.Ed. 260,63 U.S. 341,22 How. 341 |
| Parties | ALEXANDER REY, WILLIAM R. MARSHALL, AND JOSEPH M. MARSHALL PARTNERS UNDER THE NAME, STYLE, AND FIRM, OF MARSHALL & CO., PLAINTIFFS IN ERROR, v. JAMES W. SIMPSON |
| Court | U.S. Supreme Court |
THIS case was brought up by writ of error from the Supreme Court of the Territory of Minnesota.
It was an action brought by Simpson in the District Court of the second judicial district, Ramsey county, in the Territory of Minnesota, upon a promissory note given under the following circumstances:
$3,517.07 1/2.
ST. PAUL, June 14, 1855.
Six months after date, I promise to pay to the order of James W. Simpson, three thousand five hundred and seventeen dollars and 07 1/2-100, value received.
(Signed) ALEX. REY.
Simpson was the creditor, and it was intended to give him the security of Marshall & Co.; but instead of drawing the note in favor of Marshall & Co., and obtaining their endorsement before handing it to Simpson, the note was drawn as above, and give to Simpson with the endorsement of Marshall & Co. upon it. The whole case turned upon the nature of this note. Under the usual form of proceeding, Simpson would have had to write his name over that of Marshall & Co., and thus present the spectacle of the first endorser suing the second endorser. According to the old system of pleading, there might have been a difficulty; but the system of pleading in Minnesota obviated all difficulty, by enjoining upon suitors, in framing their declarations, to give a statement of the facts constituting their cause of action. Simpson's counsel therefore filed a complaint against the maker and endorsers of the note, joining them in one action, and complaining that they sould not pay the note. In this complaint, Marshall & Co. were called endorsers, and the question immediately arose, whether they were endorsers or guarantors. Accordingly, the counsel for the defendants moved to strike out of the complaint all those parts which spoke of Marshall & Co. as endorsers for the purpose of guarantying the note, and of becoming sureties and security to the plaintiff. But the court overruled the motion. The counsel for the defendants then demurred to the complaint, upon the following grounds, which are inserted because the reporter does not intend to report the arguments of counsel in this court upon this mode of making a promissory note, and this mode of declaring upon it.
The grounds of demurrer were the following, viz:
First. The said complaint does not state facts sufficient to constitute a cause of action against the said defendants, William R. Marshall and Joseph M. Marshall, or either of them, in that——
1. The facts stated in the said complaint show that the contract of the defendants, Marshall, upon the promissory note in said complaint mentioned, was that only of endorsement; and the allegations in the said complaint of the purpose for which the said defendants endorsed the said note, and of the reliance of the plaintiff upon such endorsement as security to him, are incompetent either to vary the said contract, or to change in any respect the legal obligations of the defendants, Marshall.
2. It appears, upon the face of the said complaint, that the plaintiff is the payee of the said note, that the same is payable to the order of the plaintiff, and that the plaintiff has never endorsed nor negotiated the said note.
3. The facts stated in the said complaint show, that the defendants, Marshall, could only have been made liable upon the said promissory note in the character of second endorsers, and in that character only upon the endorsement and the transfer of the note by the plaintiff. The note having matured without endorsement or transfer by the plaintiff, no liability can in any event attach to the defendants, Marshall, upon the same.
Second. There is a defect of parties defendant in said action, in that——
a promissory note payable to the order of the plaintiff, and as such endorsers cannot be held by the payee.
This demurrer was overruled, and, after some other proceedings, the court gave judgment for the plaintiff, when the defendants carried the case to the Supreme Court of the Territory. The points made in that court upon both sides are inserted, because they are substantially those which were made in this court.
Points of plaintiff in error, with authorities relied on:
I. The contract of the defendants (plaintiffs in error) was that of endorsers, and a contract of a different character cannot arise and will not be implied in conflict with the written agreement. The defendants being endorsers, they are endorsers of the plaintiff, and not liable to him.
2 Hill, 80; 3 Ibid, 233; 7 Ibid, 416.
19 Wen., 202; 6 Barber, 282.
1 Comstock, 321; 1 Spence N. Y., 256.
Story on Bills, 215; 11 Johns., 201.
1 Johns. Ch. B., 429; 4 Selden, 207.
Rev. Stat. p. 268, secs. 281, 282.
II. The complaint charges the defendants as guarantors, and shows that the contract was cotemporaneous with the inception of the note, and no construction of the authorities will charge them upon such fact otherwise than as original maker.
III. In no view can the defendants upon this complaint be regarded, except as endorsers, because, conceding that the written contract of the parties may be varied by a cotemporaneous parol agreement, facts are not stated in the pleadings from which the court can infer the nature of the contract.
IV. The complaint is double. If any contract besides that of endorsers is stated, it contains in the same count a contract of endorsement and of guaranty. There are distinct causes of action, and should be separately stated.
5 Ibid, 172; 7 Barbour, 80.
The following points and authorities were relied upon for the defendant in error:
First. The plaintiffs in error, William R. Marshall and Joseph M. Marshall, as parties to the promissory note described in the complaint, became and assumed the legal liability of guarantors and sureties for the payment of the same.
See 14 Johns. Rep., p. 349, Campbell v. Butler.
13 Johns. Rep., p. 175, Nelson v. Duboiss.
9 Mass. Rep., p. 313, White v. Howland.
11 Mass. Rep., p. 436, Mories v. Bird.
7 Mass. Rep., p. 232, Ulen v. Kitridge.
Story on Promissory Notes, secs. 479 and 480, and notes on page 641, 3d ed.
Same, p. 630, secs. 475 and 476, and notes.
Same, secs. 477 and 479, p. 638.
Second. The endorsement of the promissory note by Marshall & Co., at the time of the making and before delivery thereof, was an original undertaking on their part to pay the same, or at least to guaranty the payment thereof.
In support of this point, see the authorities above cited.
Third. The endorsement by Marshall & Co. having been made at the date of the note, and before delivery, for the express purpose of giving credit to the maker, and enabling him to negotiate the same to the payee thereof, renders them primarily liable as original parties to the note.
6 Conn. Rep., p. 315; 7 Conn. Rep., p. 310.
11 Conn. Rep., p. 440; 9 Vermont Rep., p. 345.
Fourth. The time and circumstances when and under which the note was made, endorsed, and delivered, may be properly alleged and proved, to enable the court to apply the law governing the same.
See the authorities before cited, and 4 Watt's Rep., p. 448; 9 Ohio Rep., p. 39; 2 McLean Rep., p. 553.
Fifth. The decision and judgment below is well sustained by the law of the case.
See authorities before cited.
The Supreme Court of the Territory affirmed the judgment of the court below, and the defendants brought the case to this court.
It was argued by Mr. Stevens, upon a brief submitted by himself and Mr. Brisbin, for the plaintiffs in error, and by Mr. Bradley for the defendant.
The arguments turned upon the questions, whether Marshall & Co. were endorsers or guarantors or original parties to the note, and also whether the mode of pleading had been correct.
This is a writ of error to the Supreme Court of the Territory of Minnesota.
According to the transcript, the suit was commenced by James W.Simpson, the present defendant, on the twenty-first day of December, 1855, in the District Court of the Territory, for the second judicial district, against the plaintiffs in error, who were the original defendants. It was an action of assumpsit, and was brought upon a certain promissory note for the sum of three thousand five hundred and seventeen dollars and seven and a half cents, bearing date at St. Paul, in that Territory, on the fourteenth day of June, 1855, and was made payable to the order of the plaintiff six months after date, for value received. At the period of the date of the note, as well as at the time the suit was instituted, two of the defendants William R. Marshall and Joseph M. Marshall, were partners, doing business under the style and firm of Marshall & Company.
As appears by the declaration, the note was made and signed by the defendant first named in the original suit, at the time and place it bears date.
And the plaintiff further alleges in the declaration, that, after making and...
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