Haven v. Foley

• Decision Date: 31 March 1853
• Citation: 18 Mo. 136
• Court: Missouri Supreme Court
• Parties: HAVEN, Respondent, v. FOLEY & PAPIN, Appellants.

18 Mo. 136

HAVEN, Respondent,

v.FOLEY & PAPIN, Appellants.

Supreme Court of Missouri.

March Term, 1853.

1. A creditor is entitled to the benefit of all securities given by the principal debtor for the indemnity of his surety.

2. A. executed a deed of trust on personal property, to indemnify B. as endorser of a note made by A. to C. Afterwards, D. executed his note to C. for A's debt, under an agreement between himself and B. and C. that A's note with B.'s endorsement should be delivered to him, and the deed of trust assigned to him. Under this agreement, the deed of trust was by B. and the trustee assigned to D. and the note was by C. handed to B. to be delivered to D., but B. refused to deliver it. Held, D.'s note was not an extinguishment of A.'s indebtedness, and D. is entitled to the benefit of the deed of trust given for B.'s indemnity.

Appeal from St. Louis Court of Common Pleas.

T. Polk and T. B. Hudson, for appellants.

The giving of the notes by Foley & Papin was not a satisfaction of the notes mentioned in the deed of trust. (8 Mass. 465.) The transaction amounted to a purchase of the notes by Foley & Papin, and an assignment to them. The delivery of the notes to Shepard to be delivered to the appellants, amounted to an assignment of them. (13 Mass. 304.) The assignment of the deed of trust was an assignment of the debt. (3 Met. 515; 2 Pa. 379.)

N. Holmes and M. L. Gray, for respondent.

The notes given by Foley & Papin were a satisfaction of the notes secured by the deed of trust, and the deed of trust was thereby extinguished. (Abbott v. Upton, 19 Pick. 434; 2 Greenleaf's Cruise, 187-8, and note; 4 Kent's Com. 193-4, and notes; Thayer v. Campbell, 9 Mo. 280; White v. Todd, 10 Mo. 189.) The deed of trust given to E. H. Shepard was merely to indemnify him against his liability to pay the notes of James Shepard. The defendants could acquire no title to the notes held by Emerson, as payee, but by endorsement from him, and this was not agreed to be done.

GAMBLE, Judge, delivered the opinion of the court.

Haven claimed the personal property for which this action was brought, under a mortgage made by one James Shepard, dated August 1, 1850. The defendants, Foley & Papin, who were in possession of the property, claimed to hold possession under a deed of trust, which had been given by James Shepard on the 22d of July, 1850, to secure one Elihu H. Shepard, as his indorser, on two promissory notes, executed by James Shepard in favor of one Emerson. The answer states the defence, in substance, as follows: That James Shepard made the notes to Emerson; that they were indorsed by Elihu H. Shepard; that James Shepard, by the deed of trust, conveyed the property to a trustee, the trust declared in the deed being, “that if the said James Shepard shall well and truly pay the above described notes, when they become due and payable, and save harmless the said Elihu H. Shepard from his indorsement aforesaid, then this deed shall be void and the property released; but if the said James Shepard shall fail to pay either or both of said notes, then this deed shall remain in force and the trustee may proceed to sell,” &c. The proceeds of a sale, if a sale should be made, were to be applied to the payment of the expenses, and next, to the payment of the notes or so much thereof as should remain unpaid. The answer further states, that afterwards, on the 15th of August, an agreement was made between Emerson, the holder of the notes, and Elihu H. Shepard, the indorser and the defendants, Foley & Papin, that the defendants should execute their notes for the same amounts as those made by Jas. Shepard, and pay able at the same times, which should be indorsed by Sullivan & Co., and be delivered over to Emerson, and that Emerson should deliver...