Lauman, Hedges & Co. v. Nichols

• Decision Date: 08 October 1863
• Citation: 15 Iowa 161
• Court: Iowa Supreme Court
• Parties: LAUMAN, HEDGES & Co. v. NICHOLS et al

15 Iowa 161

LAUMAN, HEDGES & Co. v. NICHOLS et al

Supreme Court of Iowa, Des Moines

October 8, 1863

Appeal from Des Moines District Court.

SUIT upon a promissory note VOL. XV.--21 signed by all the defendants as principals, payable to "The Des Moines County Savings Association," and assigned to plaintiffs. Starkey and Robinson answer, admitting the execution of the note, but claim that they signed the same as sureties of the defendant, Nichols; and that the plaintiffs were advised of this fact when they purchased said note; that plaintiffs, at the maturity of the note, for a valuable consideration extended the time of payment thereof to the said Nichols without their knowledge or consent; that shortly after such extension Nichols became insolvent, and that by such extension they claim to be released from all liability thereon. Upon this issue there was a trial, and a verdict for defendants, and plaintiffs appeal.

The errors assigned relate to the ruling of the Court in giving and refusing instructions asked, and admitting in evidence the deposition of defendant, Nichols.

Affirmed.

Crocker & Smyth for the appellants.

I. The testimony admitted by the Court below and objected to, is based upon what purports to be a copy of the note. It is descriptive and should be strictly and literally proven, or the evidence relating thereto should be excluded. 1 Greenl Ev. § 69.

II. After acquired knowledge of the relation of the parties cannot change the rights which the holder acquired under the contract of indorsement. Manly v. Boycot, 2 Ellis and Black, 46; Farmers' and Mechanics' Bank v. Rathbone, 26 Verm. 96; Church v. Barlow, 26 Mass. 547, 9 Pick. 547; Commercial Bank v. Cunningham, 24 Id. 275; Nichols v. Parsons, 6 N. H., 30; Wilson v. Foot, 11 Met 285.

III. Those who have assumed the attitude of principals cannot change that position to the injury of those who have dealt with them on that footing. Sprigg v. The Bank of Mount Pleasant, 35 U.S. 257, 10 Pet 257, 9 L.Ed. 416; Fenton v. Pococke, 5 Taunt 551; The Bank of Montgomery County v. Walker, 9 S. & R., 229; Murray v. Judah, 6 Cow. 484; Lewis v. Hanchman, 2 Barr 416; Branch Bank v. James, 9 Ala.: Grant v. Fonguson, 9-Mo., 123; The Bank v. Abbott, 28 Me. 280.

J. C. & B. J. Hall for the appellee relied, upon Kelley v. Gillespie, 12 Iowa 55.

Hon. CALEB BALDWIN, Chief Justice, Hon. GEORGE G. WRIGHT, Judge, Hon. RALPH P. LOWE, Judge, from December 7 to December 24, 1863. Hon. GEORGE G. WRIGHT, Chief Justice, Hon. RALPH P. LOWE, Judge, from January 1, 1864, to the conclusion of the Term.^[*]

OPINION

BALDWIN, Ch. J.

The questions for the jury to determine, under the pleadings and evidence, were 1st., Did the defendants Starkey and Robinson, sign the note as sureties? 2d. Did the plaintiffs know this fact when they extended the time of payment to Nichols? 3d. Did the plaintiffs, for a valuable consideration, make such extension without the consent of the sureties? These appear to have been the controverted points in the case in the Court below.

The instructions asked by the plaintiffs and refused by the Court, contain abstractly many true propositions of law and if hypothecated upon a true statement of the evidence might have been given. But only a portion of the evidence is before us, and we cannot say but that they were refused as inapplicable. The instructions given by the Court in its charge to the jury, it seems to us cover the whole of the legal propositions in the case, and if the Court was correct in its view of the law, it could with propriety refuse to give others asked. The Court, in its charge, thus directed the jury: How are the defendants connected with the note sued on--are they connected with it as principals or as sureties? If their relationship to the note was that of sureties, the next inquiry will be had the plaintiffs knowledge of this fact before the maturity of the note? If either of these two questions is determined by the jury in the negative the defense set up by the defendants will have failed. If the former be determined in the affirmative, and the latter in the negative the defense will have failed. If both are determined in the affirmative, that is that the defendants were mere sureties, and that plaintiffs had knowledge of this fact before the maturity of the note the jury will next inquire, whether the plaintiffs did for a valuable consideration extend the time of payment without out the knowledge and consent of the defendants. If they did, knowing before the maturity that defendants were only sureties, the sureties are not liable to pay it, if otherwise the defendants are liable." * * * "On the face of the note the defendants all appear as principals, or as joint and several makers; this is the character they took upon themselves on the note, and this is the character the law will hold them to, unless they show to the satisfaction of the minds of the jury that the purchaser of the note knew before its maturity that their relationship to the note was different from what it appeared to be upon its face."

This Court has, in the case of Kelley v. Gillespie, 12 Iowa 55, recognized as correct the doctrine, that one of the joint or joint and...