Logan v. Clark, 3338.

• Decision Date: 04 April 1933
• Docket Number: No. 3338.,3338.
• Citation: 63 F.2d 973
• Parties: LOGAN v. CLARK.
• Court: U.S. Court of Appeals — Fourth Circuit

63 F.2d 973 (1933)

LOGAN v. CLARK.

No. 3338.

Circuit Court of Appeals, Fourth Circuit.

April 4, 1933.

John M. Robinson, of Charlotte, N. C. (Hunter M. Jones, of Charlotte, N. C., on the brief), for appellant.

Joe W. Ervin, of Charlotte, N. C. (Walter Clark, of Charlotte, N. C., on the brief), for appellee.

Before PARKER, NORTHCOTT, and SOPER, Circuit Judges.

NORTHCOTT, Circuit Judge.

This is an action at law brought, in October, 1931, by appellant J. M. Logan, receiver of the First National Bank of Charlotte, N. C., against appellee, Thorne Clark, in the District Court of the United States for the Western District of North Carolina, to recover upon a written instrument guaranteeing the payment of certain indebtedness of Aileen Mills, Inc., to the First National Bank of Charlotte. The court, over the plaintiff's objection, submitted to the jury, and the jury answered against the plaintiff, and issue as to the release and discharge of the defendant from the guaranty agreement. From the judgment entered on the verdict this appeal was brought.

Prior to February 9, 1928, Aileen Mills, Inc., was indebted to the First National Bank of Charlotte, N. C., on certain notes given for money loaned said company by said bank. These notes were indorsed by various individuals, and on said February 9, 1928, the following writing, signed by the defendant Clark and four others, was executed:

"Whereas, The First National Bank of Charlotte, N. C., has agreed to loan to the Aileen Mills, Inc., Biscoe, N. C., Forty Five Thousand Dollars, which sum is to be secured by note or notes of said Aileen Mills, Inc., to be guaranteed by the undersigned.

"Now, therefore, we, Sloan M. Robinson, Sterling Graydon, David Clark, Thorne Clark, and H. C. Long, Jr., in consideration of said loan to be made as aforesaid, do hereby guarantee to the First National Bank of Charlotte, N. C., the prompt and full payment at maturity, with all interest and charges, and for said consideration we do hereby waive all rights to demand or protest or notice of any kind and agree that any extension of payment or renewal of or substitutions for note or notes given for the said loan may be made without any notice to or consent by us, and we further agree that if said loan or any part thereof is not paid at maturity, we shall be liable therefor, and pay the same to the bank or to the owner of said note or notes, or any paper given for the indebtedness, and we further agree that no signing or endorsement by us of the said note or notes, or other papers for the said loan shall be necessary, and this contract shall remain in force two years.

"In witness, of which we have set our hands and seals, this the 9th day of February, 1928.

"Witness:

Coit M. Robinson S. M. Robinson Seal C. G. Buie Sterling Graydon Seal C. G. Buie David Clark Seal C. G. Buie Thorne Clark Seal C. G. Buie H. C. Long, Jr. Seal"

The following pencil memorandum appears at the bottom of the foregoing writing: "March 7th, 1930. Memo. See substitute dated March 6th, 1930."

In January, 1930, Aileen Mills, Inc., was placed in the hands of a receiver, and on March 6, 1930, a new contract, guaranteeing payment of the indebtedness due the said bank from the said mills, was executed and signed by three of the original guarantors in the writing of February 9, 1928. This new contract reads as follows:

"Whereas by a paper writing dated the 9th day of February, 1928, the undersigned guaranteed to the First National Bank of Charlotte, N. C., the payment of certain obligations of the Aileen Mills, Inc., then outstanding and also certain obligations thereafter to be given and, whereas, there are now outstanding promissory notes of the said corporation made payable to said Bank, and or its assigns, for the payment of which the undersigned are liable upon their said guaranty, the said notes bearing dates and being for the principal amounts and maturing as follows:

                  Date of Note   Principal of Note    Date of Maturity
                  Dec. 20, 1929    5,000.00          60 days after date
                  Dec. 20, 1929    5,000.00          60 days after date
                  Dec. 27, 1929   10,000.00          60 days after date
                  Dec. 27, 1929   10,000.00          60 days after date
                  Jan. 18, 1930   15,000.00          On demand
                

"(The last named note bears a credit in the sum of $9,443.01, representing money on deposit applied by the Bank upon the said note, to which credit the undersigned are entitled only in the event the Bank is able to and is allowed to retain said funds.) and, whereas, the Aileen Mills, Inc., is now in receivership and the undersigned have requested the First National Bank of Charlotte, N. C., to cooperate with them for the purpose of procuring the said receivership to be continued as an operating receivership for three months.

"Now, therefore, in consideration of the agreement by the said Bank to cooperate with the undersigned for the purpose of procuring the said receivership to be continued as an operating receivership for three months, the undersigned do now acknowledge their liability to the First National Bank of Charlotte, N. C., and its assigns for the payment for the above stated promissory notes, principal and interest, and they agree to be and remain liable to the said Bank and its assigns upon all the said notes and all obligations that may be covered by the said contract of guaranty hereinbefore referred to, notwithstanding any extension of time for the payment of the said notes that the said Bank may grant to the Aileen Mills, Inc., or its receiver, and notwithstanding any concession or extension that the said Bank may make to the said corporation or its receiver, and notwithstanding anything of any nature whatsoever that the said Bank may do with respect to the said notes regardless of whether or not the undersigned consent to or receive notice of such extensions, concessions or things, the purpose and intent of this instrument being to authorize the said Bank to do anything of any nature whatsoever that it may see fit with respect to the said notes hereinabove referred to, or any obligations that the undersigned may be liable for under the said contract of guaranty without thereby releasing the undersigned or in any manner affecting their liability.

"This 6th day of March, 1930. "David Clark Seal "Sterling Graydon Seal "S. M. Robinson Seal"

On the bottom of the foregoing writing appeared the following pencil memorandum: "Memo. 3-7-30. David Clark presented to us our letter of 3-7. Copy...