Baker v. Gaines Bros. Co.
| Decision Date | 22 May 1917 |
| Docket Number | 7941. |
| Citation | 166 P. 159,65 Okla. 192,1917 OK 245 |
| Parties | BAKER ET AL. v. GAINES BROS. CO. |
| Court | Oklahoma Supreme Court |
Syllabus by the Court.
A payee of a note may at his option sue the sureties, or any one of them, without joining in the action the principal and other sureties.
The sureties are not released from liability upon a note made by a deceased principal by failure of the payee to file the claim against the estate of the deceased principal.
The negligence or passive inactivity of a holder of a promissory note to foreclose a mortgage given to secure its payment is not a defense available to the surety in the absence of a legal demand by the surety upon the holder of the note to foreclose such mortgage.
Where a petition states a cause of action, and the answer fails to set up a legal defense, judgment on the pleadings for plaintiff may properly be rendered.
Commissioners' Opinion, Division No. 1. Error from County Court, Ottawa County; Vern E. Thompson, Judge.
Action by the Gaines Bros. Company against Edgar Baker and another. There was a judgment for plaintiff, and defendants bring error. Affirmed.
A. C Towne, of Miami, for plaintiffs in error.
A. C Wallace, of Miami, for defendant in error.
This is an action brought by the defendant in error against the plaintiffs in error and other defendants, who were not served and who were dismissed at the trial without prejudice, on a promissory note executed by Thos. B. Baker and others.
The amended answer of the plaintiffs in error admitted that they had signed the note sued upon, but did so as sureties only and that Thos. B. Baker, now deceased, was the principal in said note; that A. R. Botts was the duly appointed administrator of the estate of Thos. B. Baker, that said estate was solvent, and that the promissory note sued upon could have been collected by presenting the claim to said administrator, but that said plaintiff in error failed to do so, and that the time for doing so as provided by law had passed, and that said claim was further secured by a chattel mortgage executed by Thos. B. Baker, principal, and that no effort was made to realize on said mortgage, which covered ample property to satisfy the claim, and that by reason of the neglect and failure of the defendant in error to present said claim to the administrator, and his failure to foreclose said mortgage, the mortgaged property was lost, and that plaintiffs in error are thereby exonerated and not liable in this action, and that said administrator was a necessary party.
Motion was made by the defendant in error for judgment on the pleadings, which motion was by the court sustained, and judgment rendered in favor of the defendant in error, to which action of the court the plaintiffs in error duly excepted and bring error to this court. Hereinafter the parties will be designated as they were in the trial court.
In the brief of defendants three questions are presented and argued as to why the judgment rendered should not be sustained First, that the administrator was not sued in the action and was a necessary party; second, that by the failure of plaintiff to file his claim against the estate of the deceased principal the sureties were discharged; and, third, that the plaintiff released the sureties by neglecting to foreclose the chattel mortgage given by the principal. These questions will be considered in their order.
The payee on a note executed by several obligors may proceed against any or all of the makers of said note, and it is settled in this jurisdiction that the contention that the administrator of the deceased maker of a note was a necessary party in the instant case in this action against the sureties is not well taken.
"By virtue of section 4694, Rev. Laws 1910, the holder of a promissory note may, at his option, maintain an action against the parties who sign the same as sureties without joining the principal debtor as a party defendant." Francis v. First National Bank of Eufaula, 40 Okl. 267, 138 P. 140; Sayre Commission Co. v. Keen, 26 Okl. 794, 110 P. 775; Moorehead et al. v. Daniels, 153 P. 623.
If, however, there was a want of proper parties defendant, it is settled in this jurisdiction that the only way to attack the same is by demurrer, and, as a demurrer was not interposed, consequently, even had there been a want of proper parties defendant, the failure to properly present the question is fatal to the said contention of the defendant.
The failure of the payee of the note to file the same with the administrator of the deceased maker is not a defense available to the sureties.
The liability of the sureties "is not conditioned upon the exercise of diligence by the holder of the obligation to collect of the principal, and the negligence or passive inactivity of the holder is not a defense available to the surety." Union Mutual Ins. Co. v. Page, 164 P. 116, not yet officially reported.
Again, a surety whose principal died, and whose estate is being administered, may, as is the duty of the surety, pay the claim himself and file it against the estate, or he may file a conditioned claim against the estate without having paid and discharged the debt.
In Yerxa v. Ruthruff et al., 19 N.D. 13, 120 N.W. 758, 25 L. R. A. (N. S.) 139, Ann. Cas. 1912D, 809, it is held:
"A surety is not released from liability by the failure of the creditor to file his claim against the estate of the deceased principal debtor."
In Darby v. Berney Nat. Bank, 97 Ala. 643, 11 So. 881, the court said:
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