Harnett v. Holdrege
| Decision Date | 19 April 1905 |
| Citation | 103 N.W. 277,73 Neb. 570 |
| Parties | HARNETT v. HOLDREGE ET AL. |
| Court | Nebraska Supreme Court |
OPINION TEXT STARTS HERE
Syllabus by the Court.
1. Persons who write their names in blank on the back of a promissory note payable to the order of the maker, which is indorsed by such maker and afterwards delivered to a third person, in the absence of any special agreement to the contrary, become liable thereon as indorsers and not as joint makers, and their liability cannot be varied by parol evidence.
2. Parol evidence of a custom or course of dealing previously pursued by the maker with regard to other notes of a like character is not admissible for the purpose of showing inferentially that the indorsers were joint makers, and thus change and enlarge their liability.
3. Former opinion herein (Neb. Unof.) 97 N. W. 443, adhered to.
On rehearing. Affirmed.
For former opinion, see 97 N. W. 443.
James H. McIntosh and F. A. Brogan, for plaintiff in error.
James E. Kelby, F. I. Foss, R. D. Brown, and J. W. Deweese, for defendants in error.
When this case was before us the first time it was heard by Department No. 2 of the Commission, and an opinion was written (and approved by the court) affirming the judgment below. (Neb. Unof.) 97 N. W. 443. A rehearing was allowed, and a reargument had before the court. On such rehearing some fault was found with the statement of facts contained in our former opinion. However, the principal criticism was that the indorsement, “For value received we hereby guarantee the payment of the within note, and waive presentment for payment, demand and notice of protest,” was stamped twice on the $2,000 note in suit, and only once on the one for $5,000; yet such indorsement appeared twice on the copy of the $5,000 note which is set out in the opinion. While the point appears to be well taken, a re-examination of the notes shows us that the indorsement appears on both notes under the name of the maker, the payee, and above the signatures of the defendants F. I. Foss, G. W. Holdrege, and J. W. Deweese, who are the only ones sought to be held liable in this action. It would therefore seem that the variance is not only immaterial, but is extremely trifling. This explanation, taken with the full and complete statement contained in our former opinion, to which reference is hereby made, renders any further statement unnecessary for a proper understanding of the present decision.
Counsel for the plaintiff in error vigorously assail that part of our former opinion which holds that the defendants above named were liable only as indorsers of the notes in question, for the reason that the liability incurred by them is the pivotal question in this action. It is conceded that if they are to be treated as indorsers, then our former opinion should be adhered to, and the judgment of the district court must be affirmed. Plaintiff insists, however, that they are not indorsers, but are joint makers of the notes, and should be held liable as such. To sustain this contention, counsel point to the statement contained in the amended petition “that the defendants borrowed the money” (sought to be recovered herein) “from the plaintiff's intestate on said notes.” No other facts are alleged in the amended petition from which such a liability can be inferred, and it may be stated, in passing, that the evidence not only fails to sustain the allegation, but it would seem that the corporation, the maker of the notes, borrowed the money and received the proceeds of the transaction. In fact, it is alleged in the original and amended petitions that the South Fork Irrigation & Improvement Company made the notes, and the defendants Foss, Holdrege, and Deweese wrote their names on the back of those instruments; and both petitions charge them with the liability of indorsers in clear and explicit terms, even to the proper allegation of demand, protest, and notice of protest.
So we will again consider the question as to what was the liability assumed by the defendants by writing their names on the back of these notes. It must be remembered that they were made by the South Fork Irrigation & Improvement Company (a corporation) payable two years after date to its own order, and indorsed as follows: “The South Fork Irrigation & Improvement Co., By G. W. Holdrege, Pt., By A. L. Emerson, Sec'y & Tr.” Then follows: It is claimed by the defendants that the waiver above quoted was not on the notes when they indorsed them, and that such waiver was placed there, after they signed their names thereon, without their knowledge or consent; that the notes and their liability thereon were thus materially altered and changed, and were not the contracts signed or indorsed by them.
After an examination of the evidence, we are unable to say that it is insufficient to support this claim. No evidence was offered by the plaintiff tending to prove his allegations of demand, protest, and notice of protest, and, as we are required to hold that no waiver was established, the case must turn on the nature of the liability of the defendants, under the facts above stated. It is perhaps well to state that while the South Fork Irrigation & Improvement Company, Fayette I. Foss, W. L. Matson, Geo. W. Holdrege, A. L. Emerson, C. H. Peck, and Joel W. Deweese were all alleged against in the petition, yet the case proceeded against the defendants Foss, Holdrege, and Deweese alone. One of the earliest cases in which the question of the liability of one who signs his name on the back of a promissory note made payable to the order of the maker, indorsed by him, and delivered to a third person, arose, was Lake v. Stetson et al., decided by the Supreme Judicial Court of Massachusetts (13 Gray, 310, note). In that case it appeared that one Stetson made a note payable to his own order, on which one Bates had written his name, after which Stetson indorsed it and delivered it to the plaintiff, Lake. The trial court rejected the evidence offered by the plaintiff that the note was given by the defendants Stetson and Bates as a part of the consideration of a joint purchase by them, and that the note and all of the signatures thereon were made at one interview, and before the delivery of the note, in order to charge both defendants as joint makers. A verdict was given for the defendant Bates, and the plaintiff prosecuted his exceptions, which were overruled by the Supreme Court.
The question next came before that learned court in the case of Biglow v. Colton, 13 Gray, 309, 74 Am. Dec. 633. The following is a copy of the note sued on: Upon the back of the note was the signature of Hurlbut, and under it that of Colton. At the trial it appeared that both names were signed before the delivery of the note to the plaintiff, the signature of Hurlbut being made first. At the trial the judge ruled that the defendant could not be held as a maker, and directed a verdict for him, which was returned, and the plaintiff alleged exceptions. The Supreme Court affirmed the judgment, and held that one who puts his name, before delivery, on the back of a promissory note payable to the maker or order, and indorsed by the maker, is an indorser and not a joint maker, and his liability cannot be varied by parol evidence. We quote from the opinion as follows:
In Clapp v. Rice, 13 Gray, 403, 64 Am. Dec. 639, Lake v. Stetson and Biglow v. Colton, supra, were followed, and it was held that parties who indorse their names on a promissory note before its delivery, for the benefit of the maker, are not liable as joint makers if the payee afterwards indorses his name above theirs before the note is delivered, and other parol evidence is inadmissible to show that they were joint makers. We append the following quotation from the body of the opinion in that case: ...
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