Archenhold Co. v. Smith

• Decision Date: 21 January 1920
• Docket Number: (No. 6139.)
• Parties: ARCHENHOLD CO. v. SMITH et al.
• Court: Texas Court of Appeals

218 S.W. 808

ARCHENHOLD CO. v. SMITH et al.

(No. 6139.)

Court of Civil Appeals of Texas. Austin.

January 21, 1920.

Rehearing Denied February 25, 1920.

Appeal from Milam County Court; W. G. Gillis, Judge.

Action by the Archenhold Company against A. E. Smith and others. From the judgment rendered, plaintiff appeals. Case reversed in part and rendered, and judgment reformed and affirmed in part.

Nathan Patten, of Waco, for appellant.

Chambers & Wallace, of Cameron, for appellees.

Findings of Fact.

BRADY, J.

Appellant, the Archenhold Company, a corporation, sued the defendants, A. E. Smith, J. P. Fulton, J. W. Sykes, R. L. Rich, J. W. Atkerson, J. E. Ashcraft, and C. A. Pevehouse, to recover a joint and several judgment against Smith, Atkerson, Fulton, Ashcraft, and Pevehouse, as principals, and against the defendants Rich and Sykes as indorsers, upon a certain promissory note. The petition alleged the execution and delivery of the note to Sykes and Rich by the other defendants, and the indorsement and delivery of same by the payees to appellant. The note contained this clause:

"The makers, sureties, indorsers, and guarantors of this note severally waive presentment for payment, notice of nonpayment, protest, notice of protest, and diligence in bringing suit against any party hereto, and consent that the time of payment may be extended without notice thereof."

The note also bears the following indorsement:

"Protest and diligence waived. [Signed] J. W. Sykes. R. L. Rich."

The defendant Smith answered by general denial, and by adopting the answer of his codefendants as far as applicable. Sykes and Rich answered by special demurrer, general denial, and by special answer, claiming that they were indorsers upon the note, and had been released and discharged from all liability by appellant's failure to protest the note, or to bring suit thereon at the first term of court after maturity, or to the second term, showing good cause for not bringing the suit at the first term.

Defendant Fulton made default, and the defendants Atkerson, Ashcraft, and Pevehouse answered, admitting that appellant was entitled to recover as against them, unless such recovery was defeated by matters affirmatively alleged. Following a general demurrer and general denial, it was affirmatively pleaded by them that they were each sureties upon the note, which fact was known to plaintiff at the time it acquired the note, and that they were each discharged from liability by reason of appellant's having agreed with the defendant Smith, after the maturity of the note, to two extensions of time of payment for a definite period, each in consideration of the interest to be paid by Smith.

The case was tried before the court without a jury, on the day set for trial, but the appellant and the defendants Smith and Fulton did not appear. The court heard evidence and rendered judgment for appellant against Smith and Fulton for the amount unpaid on the note, with interest, but that it take nothing against the other defendants. The trial court filed the following findings of fact and conclusion of law:

"Conclusions of Fact.

"I find: That on May 1, 1913, all the defendants, with the exceptions of J. W. Sykes and R. L. Rich, executed and delivered to the said J. W. Sykes and R. L. Rich their promissory note of that date, payable the 1st day of May, 1913, for the sum of $756.80, with 10 per cent. interest from maturity until paid, and which note provided an additional 10 per cent. on the principal and interest as collection fee in case the same was placed in the hands of an attorney for collection or suit is brought upon the same, that this note was by the payees, J. W. Sykes and R. L. Rich, defendants, transferred to the plaintiff by indorsement as follows: `Protest and diligence waived. [Signed] J. W. Sykes and R. L. Rich.' That when said note became due the same was not paid, and no protest thereof was made, and no suit was filed thereon by the plaintiff until this suit was instituted on the 25th day of November, 1916. That said note contained the following provisions: `The makers, sureties, indorsers, and guarantors of this note severally waive presentment for payment, notice of nonpayment, protest, notice of protest, and diligence in bringing suit against any party hereto, and consent that the time of payment may be extended without notice thereof.'

"I find that all of the defendants, except the payees, J. W. Sykes and R. L. Rich, and A. E. Smith, the principal maker, were sureties on said note for the principal maker, A. E. Smith. I find that said fact was known to the plaintiff at the time it acquired this note.

"I find that on May 26, 1914, the defendant A. E. Smith made a contract with the plaintiff, whereby the plaintiff, in consideration of the payment of $200 cash on the said note and the further agreement to pay interest on said note until the time of extension, agreed to a definite extension of said note to November 1, 1914, and did further agree that the sureties of the defendant Smith...