Lane v. Hyder

• Decision Date: 13 May 1912
• Parties: HENRY LANE, Respondent, v. H. H. HYDER and J. B. HYDER, Appellants
• Court: Kansas Court of Appeals

147 S.W. 514

163 Mo.App. 688

HENRY LANE, Respondent, v. H. H. HYDER and J. B. HYDER, Appellants

Court of Appeals of Missouri, Kansas City

May 13, 1912

Appeal from Clay Circuit Court.--Hon. Francis H. Trimble, Judge.

AFFIRMED.

Cause affirmed.

W. E Fowler and Claude Hardwick for appellant.

O. E Robinson and Martin E. Lawson for respondent.

OPINION

BROADDUS, J.

This is an action to recover on two negotiable promissory notes executed by H. H. and J. B. Hyder, one on January 27th, and the other on February 14, 1908, and made payable to the plaintiff. One of the notes reads as follows:

"$ 150.00 1-27th, 1908.

"Ninety days after date we promise to pay to the order of Henry Lane one hundred and fifty dollars, for value received, negotiable and payable without defalcation or discount and with interest from date at the rate of eight per cent per annum, and if the interest be not paid annually to become principal and bear the same rate of interest until paid.

H. H. HYDER,

J. B. HYDER."

"Indorsements: This note is hereby extended ninety days from m't'y. Received on the within $ 3.00 for int. July 27, Received on the within $ 3.00 int. This note extended from Aug. 27, to Nov. 27, 1909."

The other is the same kind of a note and is for the sum of seventy dollars, payable in ninety days after date. And on the back thereof were indorsements of receipt of interest and notations of extension of time of payment. H. H. Hyder made no defense to the action. The defendant, J. B. Hyder, defended on the ground that he was surety for his codefendant and that time for payment was extended for a valuable consideration by agreement between plaintiff and H. H. Hyder without his consent or knowledge, whereby he was in law discharged as such surety. The court excluded the evidence offered in support of this defense and rendered judgment for the amount of the notes and interest unpaid. The defendant, J. B. Hyder, appealed.

It is the contention of appellant that the court committed an error in refusing to admit the evidence tendered in support of his defense.

The notes were executed since the adoption of chapter 86, entitled "Negotiable Instruments," and the question is to be determined by a construction of said act. So far as we know the question is a new one in this state. Prior to the adoption of said chapter, as it now stands, it was the well settled law of the state that an extension of time of payment for a valuable consideration paid by the principal of a note without the consent of the surety operated to discharge the surety.

Section 10161 defines the status of persons connected with negotiable instruments; it reads: "Persons primarily and secondarily liable. The person primarily liable on an instrument is the person who by the terms of the instrument is absolutely required to pay the same. All other parties are secondarily liable."

Section 10089 reads: "Negotiable instruments, when discharged. A negotiable instrument is discharged: (1) By payment in due course by or on behalf of the principal debtor; (2) by payment in due course by the party accommodated, where the instrument is made or accepted for accommodation; (3) by the intentional cancellation thereof by the holder; (4) by any other act which will discharge a simple contract for the payment of money; (5) when the principal debtor becomes the holder of the instrument at or after maturity in his own right."

Section 10090 reads: "A person secondarily liable on the instrument is discharged: (1) By any act which discharges the instrument; (2) by intentional cancellation of his signature by the holder; (3) by the discharge of a prior party, except when such discharge is had in bankruptcy proceedings; (4) by a valid tender of payment made by a prior party; (5) by a release of the principal debtor, unless the holder's right of recourse against the party secondarily liable is expressly reserved; (6) by an agreement binding upon the holder to extend the time of payment or to postpone the holder's right to enforce the instrument, unless made with the assent of the party secondarily liable, or unless the right of recourse against such party is expressly reserved."

It is contended by appellant that after maturity of the notes they "ceased to be negotiable instruments," and that thereafter "anything done that would be a defense for or operate as a discharge of, either maker of the notes, would be available the same as if the notes had never been negotiable." It is...