Fisher v. Phelps

• Decision Date: 01 January 1858
• Citation: 21 Tex. 551
• Parties: WILLIAM FISHER v. PHELPS, DODGE & CO.
• Court: Texas Supreme Court

21 Tex. 551

WILLIAM FISHER

v.PHELPS, DODGE & CO.

Supreme Court of Texas.

1858.

In a suit against an indorser, presentment, demand and refusal of payment with protest for non-payment of which the indorser has notice, fixes his liability; and a petition containing these averments is sufficient in law, without alleging suit against the maker at the first term of the court after maturity of the note, or at the second with cause alleged.

The fact of notice of demand and non-payment, if not embodied in the protest, must be proved otherwise, as the protest is not evidence of any fact not therein noted.

The notorious insolvency of the maker to render unnecessary either suit or demand, to fix the liability of an indorser, must be alleged and proved to exist at the time suit should have been brought, viz.: before the first term of the court, after the cause of action accrues, or the second, if there be a sufficient excuse for not suing at the first. 18 Tex. 128.

The rule that the statute of limitation, when once commenced, will continue to run, notwithstanding a supervening disability, is but a rule of construction, not to be applied where the statute expressly, or by implication, authorizes an exception.

The clause of our statute of limitation which declares that the time of the debtor's absence from the state shall not be taken or accounted as part of the time limited by the act, includes each departure from the state, and the whole time of his absence, whether at or after the time of the accrual of the cause of action. 26 Tex. 276.

The object, policy and meaning of the provision is, that to render the bar effectual the debtor must remain in the state for the full period of time prescribed by the law.

Error from Cass. Tried below before Hon. W. S. Todd.

Suit against an indorser of a note. Petition alleged that a certain note made by one Hays Jolly in the course of trade, and for a valuable consideration, was transferred and assigned to the petitioner. That subsequently, upon the maturity of said note, it was presented at the place where it was made payable and demand of payment made which was refused, and the same was protested, of which the indorser had notice. That on the 9th August, 1853 (upwards of a year after it became due) petitioners instituted suit against the maker, and at the March term, 1855, recovered judgment against him on the note. That afterwards, they sued out an original and an alias execution upon said judgment, and caused it to be placed in the hands of the sheriff, who returned both indorsed, “No property found.” And that, at the time suit was instituted against the maker, the indorser, Fisher, was absent from the state and his residence unknown, and that then and during the pendency of said suit he was absent from the state for a period of two years. The defendant below demurred generally and pleaded limitation of four years and general denial. The demurrer was overruled.

On the trial the note made by Hays Jolly and indorsed by Fisher, and the protest thereof, was read as evidence to the jury. Plaintiff then proved that, in the early part of the year 1853, the defendant went to Georgia and was absent two or three months, and again, in 1856, defendant was absent from the state about two months. Several witnesses proved that he was not absent, at any one time, more than three months. There was a verdict and judgment against the indorser.

Michael Farley, for plaintiff in error.

I. The demurrer of the appellant should have been sustained in the court below, Because 1st. Suit had not been commenced against Jolly, the principal, upon the note at the first term of the court after its maturity, nor suit brought at the second term after said maturity, and cause alleged for not having brought suit to said first term. Hart. Dig. art. 2528.

2d. Because there was no such notice and protest as the law requires (Hart. Dig. art. 2523) and one or the other was necessary to fix the liability of the indorser.

If the notice on Fisher was served it should have been noted in the protest. Notice to Fisher being wanting, he was thereby released.

II. A general denial is no plea to a note so far as the authenticity of the note is concerned. But it may be a good plea to facts subsequent to the note.

III. The plea of limitations should have been sustained, as under the circumstances of this case the first and second term of the court became the period of limitations, the note having previously matured.

Also it should have been sustained, as the temporary absence from the state should not have been made a ground to prolong the four years' statute of limitations, such absence being for a very short period and not such an absence (the facts considered) as the statute contemplates. See Statute, Hart. Dig. art. 2395.

T. J. & J. H. Rodgers, for defendant in error.

I. The payor was wholly insolvent and there was no necessity of having his note protested, or suing to the first term of the court in order to fix the liability of the indorser Fisher; although the word insolvent is not used in the petition, yet the facts which show his insolvency are distinctly set forth and sustained by the statement of facts. If this position is correct it is decisive of the whole case. Insall v. Robson, 16 Tex. 128.

II. The plea of the statute of limitations had no reference to the time at which suit was commenced against the payor, but to the period between which the liability of the indorser Fisher accrued and the filing of petition against him. The note was due 1st of June, 1852; suit was commenced 18th of August, 1856, being two months and eighteen days over two years.

The witnesses vary in their statements, but they all make the time of absence over three months. This is deemed conclusive on this point.

HEMPHILL, CH. J.

The demurrer to the petition was properly overruled.

True there was no allegation of suit against the maker at the first term of the court after the maturity of the note, or at the second with cause alleged, etc. Hart. Dig. art. 2528. But it was alleged that there was presentment, demand, and refusal of payment, with protest for non-payment of which the appellant, who was the indorser of the note, had notice. These facts fixed his liability (art. 2531) and the petition on its averments was sufficient in law.

But there is one ground (namely, that the verdict for the plaintiffs is without evidence) on which the judgment must be reversed. The plaintiffs alleged that the defendant had notice of the demand at the place stipulated, and of protest, but the fact of notice was not proven.

It seems that the protest was read in evidence, but there was not in the instrument any certificate of the service of notice on defendant, nor that such notice was forwarded by mail, etc. Such certificate of notice in a protest is, under the statute, admitted as evidence of the fact. Art. 2532. But the facts of notice was not embodied in the protest, nor were they proven otherwise.

The defendant objected to the reading of the protest, on the ground, perhaps, that it did not show service of notice. But this was unnecessary. The protest could not be evidence of any fact not therein noted, and it was therefore proof of the demand and refusal, and of nothing more. From the bill of exceptions, it appears that the objection of the defendant to the reading of the protest was overruled, on the ground that he pleaded only a demurrer and the statute of limitations, and that he was therefore precluded from raising objections to the evidence. But this was a misapprehension. The defendant had pleaded general denial, and this put in issue all the material allegations of the petition, except the signatures of the maker and indorser, and required proof of the facts of demand, and also of the notice to the indorser, etc.

The plaintiffs contend, also, that the maker of the note was notoriously insolvent, and that therefore there was no necessity of either suit against the maker, or of demand upon him, to fix the liability of the defendant. Art. 2525; 18 Tex. 128. But they have not alleged such insolvency of the maker, at the time when the suit should have been brought. They state the history of the suit against him, from which it appears that about three years after the maturity of the note the first execution on the judgment was returned, no property found. This is no proof of insolvency three years before that time. The insolvency, which, under the statute, will authorize suit against the indorser, without first suing the maker, must exist at the time the suit should have been brought against the maker, viz.: before the first term of the court after the cause of action accrues, or the second, if there be sufficient excuse for not suing at the first term; and this must be alleged and proven.

The plaintiffs cannot maintain their action, as they have not brought themselves within any of the predicaments of facts, which would fix liability on the defendant.

The appellant contends that the plea of the statute of...