Duran v. Ayer

• Decision Date: 10 November 1877
• Citation: 67 Me. 145
• Parties: JOB R. DURAN v. GEORGE F. AYER.
• Court: Maine Supreme Court

67 Me. 145

JOB R. DURAN v. GEORGE F. AYER.

Supreme Judicial Court of Maine.

November 10, 1877

ON EXCEPTIONS from the superior court.

ASSUMPSIT on the following agreement: " Portland, Dec. 11, 1874. Job R. Duran having this day sold and conveyed to me all his interest in the property and rights and credits of the firm of J. R. Duran & Co., said firm consisting of said Duran and myself, and it being part of the consideration of said sale, that I shall assume and pay all debts and liabilities of said firm now existing, I do hereby promise and agree to and with said Duran, that I will assume and pay all the debts and liabilities of the said firm of J. R. Duran & Co. and hold said Duran harmless from the same, and from all costs or damage on account of the same. And I further promise and agree, in consideration of said conveyance to me, to pay to the said J. R. Duran the sum of fifteen hundred dollars in five equal installments of three hundred dollars each; the first payable March fifteenth; the second, April first; the third, April fifteenth; the fourth, May first; and the fifth May fifteenth, 1875. (Signed) George F. Ayer. Witness, S. C. Strout."

The parties agreed, that of the $1,500, $806 had been paid, and the balance $694 and interest remained due.

The plaintiff claimed at the trial that two notes were given for loans to the firm and were firm liabilities, which the defendant, under the agreement in suit, was bound to pay. The defendant contended that the notes were the personal debt of the plaintiff and not the debt of the firm. These notes were of the following tenor: " $500, Portland, September 5 1874. Four months after date, I promise to pay to the order of J. R. Duran, five hundred dollars, payable at Casco National, with interest, at 12 per cent., value received. (Signed) J. R. Duran. (Indorsed) J. R. Duran, J. R. Duran & Co."

" Mortgage duly stamped. $550. Portland, July 16, 1873. On demand, after date, I promise to pay to the order of Nathan Hill, five hundred fifty dollars, at any bank in Portland value received, with interest of twelve per cent. per annum, payable semiannually, till said note is paid. (Signed) J. R. Duran. (Indorsed) without recourse, Nathan Hill, J. R. Duran & Co."

Prior to the giving of either of the notes, the plaintiff owned a house in Portland, which was under mortgage, on which was then due about $1,400 and interest. July 16, 1873, he mortgaged the equity to Nathan Hill to secure note of $550. On March 5, 1874, a note was given for money loaned by George R. Davis, and the plaintiff secured this note by an absolute deed of his house, subject to the mortgage. The note of September 5, 1874, was given in renewal of the note of March 5, 1874, and in the same form. Davis at the date of the agreement in suit gave the following: " Portland, December 11, 1874, I, George R. Davis, hereby agree to and with Job R. Duran that upon the payment to me by George F. Ayer, of said Portland, of the sum of ten hundred and fifty dollars, with accrued interest thereon, within six months from date hereof, I will discharge a certain mortgage on the house No. 31 Elm St., in said Portland, now occupied by said Duran, made to secure the sum of five hundred and fifty dollars; and I will also convey to said Duran, or to such other person as he may direct, by good and sufficient deed, all my right, title and interest in and to said house, subject to any other outstanding mortgages. (Signed) George R. Davis."

The plaintiff never paid either of said notes or mortgages, otherwise than by his house which subject to said mortgage was taken by Davis who still holds the said five hundred dollar note. The plaintiff claimed, and there was testimony tending to prove, that the value of the house was $3000, and sufficient, at any time before it was taken from him, to pay all incumbrances on it, including the $500 note. Davis testified it would not sell for over $2000 at the time of the trial and offered to sell it for that. There was evidence tending to show that on July 1st, 1876, the whole amount due and secured by mortgages and deed to Davis of the house, including unpaid taxes, amounted to $3195. Plaintiff claims, and there was testimony tending to show, that the two notes in controversy were fully paid by the house taken by Davis, while Davis testified that the house was insufficient to pay the incumbrances by more than $1000.

The $500 note was signed by plaintiff, who testified that he placed the name of J. R. Duran & Co. on the back of the note, at its acceptance, and before he placed his own name on the back, and claimed this made the firm of J. R. Duran & Co. original promisors; and also claimed and testified that as between him and the firm, the notes were an accommodation by him. Mr. Davis who wrote and received the note, testified that the plaintiff signed and indorsed it, and handed it to him, Davis, and he, Davis, passed it back, and desired Duran to place the firm name on it, which plaintiff then did; and the defendant claimed that J. R. Duran and he were indorsers only.

Davis was surety upon a bond given by the defendant of record to release attachment against Ayer and to pay the judgment recovered in this case, and is the real party conducting the defense. Upon these issues the judge instructed the jury: " If a note is made payable to me and I indorse it, I assume simply the liability of an indorser; that is, upon non-payment by the maker, and due notice to me, that I will pay the note. Whereas, if a note is payable to a third person and signed by another person, and I at the time of the inception of the note, and as a part of it, put my name on the back of the note, I am not an indorser but an original maker, as liable as if my name appeared on the face of the note as one of the makers.

The question is not whether the firm of J. R. Duran & Co. were liable as sureties or indorsers, or what their liability upon that note to Davis may have been; the question is, how does the matter stand between the firm of Duran & Co. and Duran. Was this a debt of the firm, or as between the firm and Duran was it a personal, private debt of Duran, which it belonged to him to pay.

Upon this issue the burden of proof is upon the plaintiff to satisfy you by the balance of the testimony, by the weight of evidence, that at the time the amount of indebtedness represented by these two notes was a firm debt, a firm liability, one that as between this plaintiff Duran and the firm, it belonged to the firm to pay.

So that you perceive that the determination of this case is free from any technicality. It is a pure question of fact and the determination of it must depend upon the finding of the jury from all the evidence in regard to that matter. That is to say, the plaintiff in order to recover here must satisfy you that this money was procured and advanced for the benefit of the firm of J. R. Duran & Co. It would not be sufficient if he simply put it in as a part of his capital which it was his duty to put into the firm. That would not create a firm liability, or if it was advanced by Duran as any money due from him to the firm which he had previously drawn out. If it was used in that way it would not create a firm liability. But the plaintiff...