McCune v. Belt

• Decision Date: 31 March 1866
• Citation: 38 Mo. 281
• Parties: JOHN S. MCCUNE, Appellant, v. HENRY B. BELT et al., Respondents.
• Court: Missouri Supreme Court

38 Mo. 281

JOHN S. MCCUNE, Appellant,

v.HENRY B. BELT et al., Respondents.

Supreme Court of Missouri.

March Term, 1866.

Appeal from St. Louis Circuit Court.

This was a suit upon a bill of exchange, dated St. Louis, Oct. 23, 1860, drawn by defendants, in favor of the plaintiff, upon Jno. J. Anderson & Co., and accepted by them, payable sixty days after date, at the Bank of Commerce, New York, for $5,000, protested for non-payment.

The petition alleged protest and notice to defendants. The supplemental and amended answer, upon which the case was tried, denied notice of presentment, demand and protest; alleged that plaintiff endorsed said bill for accommodation of acceptors, before defendants signed as drawers, also for accommodation of acceptors, and that they were merely accommodation drawers, and sureties only; that plaintiff, after he became owner of the bill, for a good consideration paid by acceptors, and without knowledge or consent of defendants, did give time of payment to the acceptors, and defendants as sureties were discharged. Further, that said acceptors, Jno. J. Anderson & Co., placed in the hands of plaintiff securities to a large amount, to indemnify him against his liability, which securities the plaintiff returned to said acceptors without the knowledge or consent of defendants, thereby exposing them, an sureties, to great loss and damage; that the acceptors, by payments and the proceeds of securities placed in his hands, had been paid the amount due upon the bill; that said acceptors, to indemnify plaintiff for his liability upon this bill and other indebtedness, gave him other securities; and claiming that, as sureties, they were entitled to the benefit of these securities; and prayed an account thereof, and relief, &c.

At the trial before the court, without a jury, the plaintiff read the bill and protest thereof, showing demand on December 24, 1860, and the notary enclosed the notice to drawer and endorsers to the cashier of the Bank of Missouri on the 26th of December, the 25th being Christmas, in time for the mail of that day. He then attempted to prove notice delivered to the defendants. The witness who delivered the paper, supposed to be the notice to the defendants, testified that the paper shown him was the paper served upon defendants. This notice was dated New York, December 24, 1860, and described a bill for $5,000, dated October 28, (not 23d the date of bill sued on,) no place of drawing mentioned, drawn by defendants, and accepted by Jno. J. Anderson & Co., and endorsed by defendants; it did not state that it was endorsed by plaintiff. To avoid the defects in this notice, the plaintiff attempted to show that the same parties were not upon any other bill to which such notice could apply, although it appeared that defendants were upon Anderson's paper, as accommodation drawers or endorsers, to large amounts, and that there were one or two other bills for $5,000 in that month at the Bank of St. Louis. He also attempted to show that defendants, in conversation with the acceptor spoke of their liability upon this bill, and they were told that plaintiff had taken up the bill, and that the acceptors had secured him. The defendants contended that notice of protest of the bill was not proved to have been given them.

To prove their equitable defences of extension of time, surrender of securities, and reception of securities, and the dealings between plaintiff and Jno. J. Anderson & Co., defendants showed that this bill was taken up by McCune at the Bank of Missouri, on December 22, 1860, by the discounting of a new bill for $5,000, drawn by N. B. Mulliken, and accepted by McCune; that the proceeds were $4,850, and that the balance $252.41, was paid by check, The items of this were, interest $150, exchange, $100, protest and telegraph $2.41; total $252.41.

It appeared that McCune, in his account rendered to Anderson & Co., December 22, 1863, charged for exchange $400, instead $100, the actual rate at that time, as evidence tending to show that the bill had been extended for Anderson, and that he was charged with the exchange when the renewed bill matured, and that this $252.41 was paid by J. J. Anderson to McCune in December, 1860, the renewal being for his benefit, and he paying the discount, exchange and expenses.

It appeared that John. J. Anderson & Co. were bankers, and being hard pressed, applied to the Bank of Missouri for $25,000 loan, and the bank agreed to make the loan; and he made three bills, accepted by himself--this of $5,000, at 60 days; one of $10,000, at 4 months, drawn by Howard and endorsed by McCune; and one at 90 days for $10,000, endorsed by George Knapp & Co. and drawn by McCune.

Anderson, being embarrassed, suspended; and upon McCune applying to him for security for his endorsements and his deposit account of $4,550.11, transferred to McCune his interest in railroad contracts and lands from New Orleans to Houston, Texas. This interest cost $50,000, and was valued by some parties at higher rates. This was afterwards returned by McCune to plaintiff, and other securities taken. Anderson turned over this agreement to one Eldridge for $38,000. This security was given to McCune in November, 1860, before the protest.

Anderson gave McCune afterwards two notes of $5,000 each, secured upon a tract of land near Hannibal, known as the Broadaxe tract; a judgment against Sophia Tatum for $12,600; and four notes of $7,000 each, secured by deed of trust upon a lot on Olive street, subject to a prior deed of trust for $12,000. These notes were payable to one F. A. Howard, and from this McCune realized $17,373.64: these were given in November, 1860. For his deposit account Anderson gave McCune two notes. The securities were given to McCune to indemnify him against his liability to the Bank of Missouri for $25,000 and the deposit account. Upon the renewal of the bill sued upon, Anderson paid McCune the interest and exchange in December, 1860, $252.41. Anderson also made payments to McCune upon these liabilities; he also gave McCune a note for $10,000, secured upon some mines. The notes for the deposit account were dated March 2, 1861, at 9 and 12 months.

The plaintiff then asked the court to give the following instruction:

1. If the court find from the evidence that the bill of exchange sued on was presented at the Bank of Commerce, in the city of New York, on the day which it became due; that it was not paid; that the same was protested for non-payment on that day, and that notice given in evidence by defendant was on that day sent to the Bank of the State of Missouri by mail; that said notices arrived here on the 29th day of December, 1860, and were on that day sent to defendants; that defendants knew that said notice referred to the bill of exchange sued on,--then the plaintiff is entitled to recover the amount of the said bill, together with ten per cent. damages thereon, and interest upon the same at the rate of six per cent. per annum.

To which refusal of the court, the plaintiff then and there excepted.

The defendants asked the court to give the following instructions:

1. If the plaintiff McCune, for a valuable consideration to him paid by John J. Anderson & Co., the acceptors of the bill of exchange sued upon did give delay and ____ time of payment to said acceptors without the consent of defendants, the defendants, the drawers of said bill, were discharged from any liability upon said bill.

2. If the plaintiff, at the request of said John J. Anderson & Co., did become surety for them at the Bank of Missouri for the sum of $25,000, either as drawer or endorser of the bill offered in evidence, to-wit, that sued upon, and two bills of $10,000 each, all dated October 23, 1860; and if the said John J. Anderson & Co., before the maturity of any of said bills, did give the plaintiff his four negotiable promissory notes made by John J. Anderson, each for the sum of $7,000, two payable at two years, and two payable at one year, secured by the deed of trust offered in evidence; and if the said Anderson did subsequently give to the plaintiff his two notes of $5,000 each, payable at one and two years, secured by deed of trust upon the Broadaxe tract, offered in evidence. thereby taking, accepting and holding the said notes of said Anderson, the plaintiff did give time to said Anderson, and thereby did discharge the defendants, who were sureties of said Anderson upon the bill sued upon.

3. The defendants, upon the face of the bill as drawers, were sureties of John J. Anderson & Co.; and if the defendants signed their names as drawers of said bill, after the same had been endorsed by the plaintiff, for accommodation of John J. Anderson & Co., the acceptors, then the defendants were accommodation drawers, and defendants had notice of that fact.

4. If the said John J. Anderson & Co. did deposit with plaintiff, before the maturity of said bill sued upon, securities against the plaintiff's liability on said bill and security for the balance due upon deposit account, $4,550.01, and the two bills for $10,000, and if the plaintiff did so, without consent of the defendants, return any portion of said securities to said Anderson in exchange for other securities given by said Anderson to said plaintiff, the plaintiff thereby discharged the defendants from their liability, as sureties, to the extent of the value of the securities surrendered to said acceptors.

5. The value of the securities thus returned by plaintiff to said acceptors is to be determined by their value at the time of said return and substitution; and although the plaintiff was not obliged to accept said securities from the acceptors, yet, having accepted them, he was in equity under obligation not to deal in any manner with such securities to the injury of the securities without their consent.

Glover & Shepley and Holliday, for appellant.

I. The relation of creditor and principal did not exist between the plaintiff and Anderson when...