Maitland v. Citizens' Nat. Bank

• Decision Date: 25 June 1874
• Citation: Maitland v. Citizens' Nat. Bank, 40 Md. 540 (Md. 1874)
• Parties: BENJAMIN MAITLAND v. THE CITIZENS' NATIONAL BANK OF BALTIMORE.
• Court: Maryland Court of Appeals

40 Md. 540

BENJAMIN MAITLAND v. THE CITIZENS' NATIONAL BANK OF BALTIMORE.

Court of Appeals of Maryland

June 25, 1874

APPEAL from the Superior Court of Baltimore City.

The suit in which this appeal is taken, was brought by the appellee against the appellant on an accommodation promissory note. The case is stated in the opinion of the Court.

First Exception. Stated in the opinion of the Court.

Second Exception. The plaintiff offered the following prayers:

1. If the jury shall find from the evidence, that the plaintiff had been in the habit of discounting drafts for the firm of Phillips & Maitland, prior to the 10th of January, 1872, and that upon that day the said firm applied to the plaintiff to discount two drafts which the plaintiff declined to do unless the said firm would furnish them with security, to the amount of $10,000 or $15,000, to cover any drafts which had theretofore been or should thereafter be discounted by the said plaintiff, for or on account of said firm, and that Burgwyn Maitland being a member of the said firm, stated to the cashier of the plaintiff, that the said firm was anxious to obtain the money on the said drafts on that day, and that if the said plaintiff would discount them, he would bring the defendant's note for the amount named as such security on the next day; and shall further find, that the said plaintiff did discount the said drafts on the faith of the said promise, and that on the following day the said Maitland brought and delivered to the plaintiff the note offered in evidence by the plaintiff, and agreed that the plaintiff should hold the same as collateral security for drafts discounted, or to be discounted as aforesaid; and if they shall further find, that at the time of the institution of this suit, there was due from the said Phillips & Maitland to the plaintiff, on account of drafts discounted prior and subsequent to the promise of the said Maitland to furnish such security, a sum greater than the amount of the said note, then the plaintiff is entitled to recover the full amount of the said note, with interest in their discretion from the maturity thereof.

2. If the jury shall find the facts set out in the plaintiff's first prayer, and shall further find that the said note was signed and given by the defendant to the said Burgwyn Maitland, under the circumstances stated in the evidence of the defendant, but that the said circumstances were not communicated to the plaintiff, and that the plaintiff took the said note, as stated in said first prayer, without any knowledge or notice of any limitation upon the authority of the said Burgwyn Maitland, as to the purpose for which the said note was to be used by him, then the plaintiff is entitled to recover the full amount of said note, with interest from the maturity thereof, in their discretion, and there is no evidence in the case from which they can find that the plaintiff had such knowledge or notice.

3. If the jury shall find from the evidence that the promissory note mentioned in the evidence was signed and given by the defendant to his son, under the circumstances stated in the evidence of the defendant, and shall further find that neither the defendant nor his said son informed the plaintiff that the authority of the said son of the defendant to use the said note, had been in any way limited by the said defendant as stated in his the said defendant's testimony, and that the said plaintiff had no notice of such limitation of authority, and if they shall further find that the said note was endorsed and delivered by the payees therein named to the plaintiff, as security for any indebtedness on the part of the said payees to the plaintiff on account of transactions prior or subsequent to the date of the said note, and shall further find that the plaintiff upon the faith of such endorsement and delivery, or promise of the said payee to endorse and deliver the same as such security as aforesaid, advanced money to the said payees, then the plaintiff is entitled to recover against the defendant the full amount of the said note, provided they shall find that there was due at the time of the institution of the suit, from the said payees to the plaintiff on account of such transactions, an amount equal to the amount of said note.

And the defendant offered the following prayers:

1. If the jury shall believe from the evidence, that at the time when the promissory note of the defendant here sued upon was deposited with the plaintiff's cashier, the said cashier knew that it was an accommodation note drawn in favor of and lent by the defendant to Phillips & Maitland for the purpose of being deposited with the plaintiff as collateral security, and received and accepted it as such with that knowledge; and shall further find that the defendant in lending his said note to be deposited as aforesaid with the plaintiff, authorized and consented only to its being pledged as security for the two drafts discounted on January 10th, 1872, and such other paper as plaintiff might subsequently discount for Phillips & Maitland and for none other, and executed and lent the said note to that firm for such specific purpose and application and none other; then the plaintiff is not entitled to recover against defendant on account of any indebtedness or liability of Phillips & Maitland to plaintiff, for discounts prior to January 10th, 1872, of paper not matured when said pledge was made, even although the jury shall find that Burgwyn Maitland did in fact pledge the said note to the plaintiff to secure it against loss from such previous discounts as testified to by Mr. Guest, and that Mr. Guest believed he had authority to do so.

2. If the jury believe that the note sued on was an accommodation note, known to and received by Mr. Guest as such, and was lent by defendant to Phillips & Maitland to be lodged with the plaintiff, as collateral security, to the knowledge of Mr Guest; and shall further find, that the defendant did not authorize Phillips & Maitland in lending said note to them, to pledge it for any liability of theirs upon any transactions with plaintiff prior to January 10th, 1872, and that they had no right as between him and them to do so, but that Burgwyn Maitland did, nevertheless, pledge it, as testified to by Guest, as security for prior discounts of paper not then matured, and in excess of the authority given to him by the defendant as aforesaid; the existence of such pre-existing liability on the part of Phillips & Maitland to plaintiff, furnishes no sufficient consideration for such pledge to bind the defendant therefor; and he is not liable thereunder in this action.

3. If the jury shall find from the evidence, that the promissory note sued on in this case was made by the defendant for the accommodation of Phillips & Maitland, the payees thereof, and without any value or consideration paid by them to him therefor, and was given by him and received by them, with the agreement that the said note should be left with the plaintiff, as collateral security, for the payment of the two drafts of January 10, 1872, drawn by said Phillips & Maitland, and discounted by the plaintiff for them, and for the payment of any other drafts which said Phillips & Maitland might thereafter draw and have discounted by the plaintiff, and for no other purpose; and that the procurement of said note by said Phillips & Maitland, from the defendant, was obtained because of the suggestion of the cashier of the plaintiff, that said firm should obtain from the defendant his note to be left with the plaintiff, as collateral security; and shall further find, that said note was left by said Phillips & Maitland, with the plaintiff, on the 11th January, 1872, as collateral security, not only for the said drafts, dated January 10th, 1872, and all drafts which might thereafter be drawn by the said Phillips & Maitland, and discounted by the plaintiff for them, but also for all drafts of said Phillips & Maitland, which had been discounted by said plaintiff prior to the said 10th January, 1872, and were then running, then the plaintiff is not entitled to recover against the defendant the amount of any drafts which had been drawn by said Phillips & Maitland, and discounted by the plaintiff prior to the 10th January, 1872, nor for any other indebtedness on the part of said Phillips & Maitland, except the amount of such of the drafts drawn by the said Phillips & Maitland, on or after the 10th January, 1872, and discounted by the plaintiff, as were not paid to the plaintiff.

4. If the jury find from the evidence that the promissory note sued on was lent and delivered by the defendant to Phillips & Maitland with the limited authority, for the use and application thereof, as collateral security to the plaintiff, which is testified to by the defendant's witnesses, the burden of proof is upon the plaintiff to satisfy the jury that the said note was pledged to the plaintiff to any extent, or for any purpose not so authorized by the defendant; provided, the plaintiff seeks to recover under such unauthorized pledge.

5. If the jury find from the evidence that the note sued upon was not pledged by Phillips & Maitland to the plaintiff, as security for previous discounts, but only as security for the drafts discounted on January 10th, 1872, and thereafter to be discounted, as testified to by Burgwyn Maitland, the plaintiff is not entitled to recover in this case, on account of any liability of Phillips & Maitland, by reason of such previous discounts, and can only recover for such loss as the plaintiff may have incurred by the discount of the drafts of January 10th, 1872, and of drafts discounted thereafter.

The defendant excepted specially to the plaintiff's prayers, as follows:

The...