Carter v. Long

• Decision Date: 18 April 1900
• Citation: 125 Ala. 280,28 So. 74
• Parties: CARTER ET AL. v. LONG ET AL.
• Court: Alabama Supreme Court

28 So. 74

125 Ala. 280

CARTER ET AL. v. LONG ET AL.

Supreme Court of Alabama

April 18, 1900

Appeal from circuit court, Walker county; James J. Banks, Judge.

Action by Long Bros. against D. K. Carter, J. B. Shields, and others on a note. From a judgment in favor of plaintiffs, defendants appeal. Affirmed.

As originally framed, the complaint had three counts, but, as the defendants' demurrer was confessed as to the second count, no further notice will be taken of it. The first and third counts declare upon an indorsement by defendants of a promissory waive note, made to J. W. and A. N. Elliot by the Jasper Stone-Quarry Company, a body corporate, per F. A Gamble, as its president, for $451.60, dated the 18th day of December, 1894, due and payable one day after date at the office of the Jasper Trust Company, Jasper, Ala., and indorsed in blank jointly and severally by the defendants and also by said F. A. Gamble and one John B. Carrington, who are not sued, which said note is alleged to have been assigned and transferred by the payees for value to plaintiffs; and in each of said counts plaintiffs aver that on the 8th day of April, 1895, the defendants each waived protest of said note, and notice thereof, in writing on the back of said note, and signed their respective names to such waiver. Waiver of exemptions by defendants was alleged in all the counts of the complaint, but the complaint was afterwards so amended as to strike out that claim in all said counts and others subsequently added by amendment, and hence no further notice need be taken as to the question of waiver of exemptions. The plaintiffs subsequently amended the complaint by adding thereto four additional special counts, numbered 4 5, 6, and 7. In the fourth count the defendants are sued as co-makers of said note. It avers that, although the names of the defendants appear on the back of said note, yet that the contract and agreement between the defendants and the payees of said note at the time it was made, and at the time the debt evidenced by the note was contracted, was that they, the said defendants, as officers and members of the Jasper Stone-Quarry Company, should make the note jointly with it and that the note was made, and the defendants' names written on the back, as makers, and not as indorsers, before it was delivered to the payees, all as one act or transaction, and that the defendants are jointly, or jointly and severally, bound to plaintiffs, who are assignees or transferees of the note, just the same as if their names had been written below the name of the stone-quarry company, in whose affairs defendants are interested as officers and stockholders. The fifth count is like the fourth in every material particular, except that in it the defendants and the other persons whose names are signed on the back of said note are alleged to be co-sureties for the said Jasper Stone-Quarry Company, being officers and stockholders therein, and interested in its affairs, etc. The sixth count like the first and third, declares on the indorsement, waiver of notice, and protest, etc., but alleges a consideration for the indorsement, moving to defendants, in that it settled a debt they owed the payees, in accordance with an agreement made at the time to that effect, and the acknowledgment to plaintiffs by defendants of their continued liability on the note after plaintiffs purchased it, etc. The seventh count, like the first and third, declares on said contract of indorsement as such, waiver of notice and protest by defendants as aforesaid, but also alleges due and legal protest for nonpayment, and notice thereof to defendants, etc. The defendants demurred to the first, second, and third counts of the complaint. As stated above, the plaintiffs confessed demurrer as to the second count, and also all the grounds of demurrer to the first and third counts, except one, the same in each, viz. "that the alleged waiver of notice and protest are shown to have been made after the maturity of the note," which is a fact, but no answer to the complaint. The court sustained this ground of demurrer, and plaintiffs amended each of said counts 1 and 3 by alleging, in substance, (1) that the defendants indorsed said waiver of notice and protest in pursuance of a contract or agreement made by them with the payees, in order to enable the payees to sell the note to plaintiffs, thereby binding and obligating themselves to pay the amount due on the note to plaintiffs, and that plaintiffs, relying on this contract and promise, were induced thereby to purchase, and did purchase, said notes; (2) that defendants indorsed on said note said waiver of notice and protest, in order to enable the payees to trade, and in order to induce plaintiffs to purchase it, whereby plaintiffs were induced to purchase, and did purchase, said note upon the faith and credit of said waiver, without which they would not have purchased it, etc. Defendants again demurred to the first and third counts, as amended, (1) because said waiver was made after maturity, and not on any new consideration; (2) because said waiver was not shown to have been based on a contract between plaintiffs and defendants; (3) because it is not shown what defendants did to induce plaintiffs to purchase said note; (4) that said averments are mere conclusions; (5) that said promise to pay was not an unconditional promise. At the trial at the February term, 1898, defendants demurred to the fourth, fifth, and sixth counts of the complaint, but not to the seventh count: To the fourth and fifth because (1) they seek to vary the terms of a written contract; (2) that the contract sued on is shown to be different from the maker's contract. To the sixth count because (1) that the waiver was after maturity, and not in pursuance of a contract between plaintiffs in defendants; (2) that the consideration for the waiver did not move between the parties; (3) that the waiver was not made in pursuance of a contract between the parties to this suit; (4 and 5) as to waiver of exemptions, confessed. The judgment entry does not show any rulings upon these demurrers to the fourth, fifth, and sixth counts of the complaint.

The defendants filed the following pleas: "(1) They plead in short, by consent, the statute of frauds. (2) That the indorsement in blank of the note sued on by the defendants was made after the maturity of the note, and was an undertaking to answer for the debt, default, or miscarriage of another, and that it was a different and distinct contract from the note itself, and that it fails to express any consideration. (3) They plead a want of consideration. (4) That there was no consideration moving to or from the payees of the said note, nor to or from the plaintiffs in this case, in the making of the contract of indorsement in blank. (5) That the indorsement made by defendants on the 8th day of April, 1895, in which the notice and protest is waived, was after the maturity of said note, and was an undertaking to answer for the debt, default, or miscarriage of another, and that it was a different and distinct contract from the note itself, and that it fails to express any consideration. (6) There was no consideration, moving to or from the payees of said note, nor to or from the plaintiffs in this case, in the making of the contract of indorsement, wherein defendants waived notice and protest. (7) The defendants allege that they have been released from all liability as indorsers of said note because of a composition entered into by and between the plaintiffs and J. B. Carrington as executor, and M. A. Gamble as executrix, of F. A. Gamble, deceased, and J. B. Carrington, prior indorsers of said note, on the 18th day of August, 1896, and on the 19th day of February, 1897. Said composition was made without the knowledge or assent of defendants."

The alleged composition of release referred to in the seventh plea was made in a suit brought by J. B. Carrington executor, and M. A. Gamble, executrix, against Long Bros., and was a part of said seventh plea. The said agreement was executed on August 18, 1896, and provided that Long Bros. should forthwith bring suit on certain notes held by them against all the makers except the personal representatives of F. A. Gamble, and prosecute the same to judgment; it being expressly understood that said agreement was not to affect, in any wise, the liabilities of said notes to Long Bros. It was then provided that upon the recovery of judgment by Long Bros. said judgment was to be transferred and assigned by them to the personal representatives of F. A. Gamble, deceased. A supplemental agreement to this alleged composition was entered into on February 19, 1897, and provided that "the real purpose or intent of the agreement of August 18, 1896, and of this supplemental agreement, is to ascertain and determine the liability of the parties sued on in the case brought by Long Bros., other than M. A. Gamble and J. B....