Nash v. Fugate

• Decision Date: 08 January 1880
• Citation: 73 Va. 595
• Court: Virginia Supreme Court
• Parties: NASH v. FUGATE & als.

73 Va. 595

NASH v. FUGATE & als.

Supreme Court of Appeals of Virginia.

January 8, 1880

Absent, Moncure, P.^[a1]

1. A bond is signed by the principal obligor and a number of sureties, and there are several scrolls below the names of the sureties who sign it. In other respects the bond is complete and perfect on its face; but the sureties sign it and deliver it to the principal obligor, on condition that he shall obtain additional sureties to execute it, before he delivers it to the obligor; but he violates the condition and delivers it to the obligee, without obtaining additional sureties--HELD: The bond is binding on the sureties, unless the obligee had notice of the condition on which they executed it; and the fact that there were other scrolls to the instrument, to which no name was signed, was not sufficient to put the obligee upon enquiry as to the authority of the obligor to deliver the bond to him.

2. A bond, signed by a principal obligor and sureties, apparently perfect and complete, may be avoided by parol proof that the obligee, at the time he received it from the principal obligor, had notice that other persons were to sign it, in order to make the instrument effectual as to those who did sign it. But in such a case the evidence ought to be very clear and satisfactory.

This case was argued at Wytheville, but decided at Richmond. It was once before in this court, and is reported in 24 Gratt 202. That report states the nature of the case, and gives a copy of the covenant sued on and the names of the parties to it.

When the cause went back to the circuit court of Russell county the death of the defendant Vermillion was suggested; and the surviving sureties, in addition to the first, fourth and fifth general pleas of non est factum, which had been pleaded before the case came up to this court, filed two special pleas of non est factum, which are numbered sixth and seventh. The sixth is as follows:

The defendants--naming them--say the plaintiff his action against them ought not to be maintained, because they say before they signed said writing obligatory their co-defendant, A. W Smith, had drawn the body of it, and in the presence of the plaintiff made a great many scrolls to it for obligors to sign, and in this imperfect and incomplete condition, with his own name signed as principal obligor, brought it to these defendants respectively, at different times and places, and then and there represented to them respectively, that if they would respectively sign to become bound as his sureties to the plaintiff, with as many more solvent sureties as would fill up the scrolls affixed thereto, that he, the said A. W. Smith, would not use it, or deliver it to the plaintiff until and unless he procured solvent sureties with these defendants to sign their names opposite each scroll to the said paper affixed, and become bound with them thereby.

And these defendants further say, that on this express contract and condition they respectively, and at different times and places, as the paper was presented to them, respectively signed it, and in its unfinished condition handed it to said Smith, to have perfected, by having it signed by other solvent persons as aforesaid. And the defendants further say, that afterwards-- to wit: the ____ day of ____, 18--, the said A. W. Smith, in the imperfect and incomplete condition the said paper was in when the last of these defendants signed it, and with a great many scrolls on the paper below their names that no names of obligors were signed to, and in violation of the conditions aforesaid on which these defendants were bound, fraudulently delivered it to the plaintiff, and in its imperfect and incomplete condition--to wit: with the said Smith's and these defendant's names signed to it only, and a great many scrolls written to it as aforesaid for other obligors to sign below these defendant's names, to which no names of obligors were signed, the plaintiff wrongfully and fraudulently accepted and received; wherefore these defendants further say, the plaintiff at and before the delivery of said supposed writing obligatory to him, had notice that these defendants had signed it to become bound thereby only when other solvent persons with themselves should sign their names to the vacant scrolls below their names, and become bound with them thereby, who had not done so; wherefore they say the said supposed writing obligatory is not their act and deed.

The 7th plea is as follows:

The defendants, & c., & c., come, & c., say the plaintiff, his action against them should not maintain, because they say A. W. Smith procured them to sign and deliver the said writing sued on to him to get other obligors to sign it on the following contract and agreement, made and entered into by and between said Smith and these defendants--to wit: that these defendants would and did sign said writing as sureties of said Smith on the express condition that it was not to be obligatory on these defendants, or either of them, and was not to be delivered by said Smith to the plaintiff as the bond of these defendants, or either one of them, unless and until said Smith procured a great many more solvent persons--to wit: a number sufficient with these defendants to make twenty--to sign it and become bound with them as co-sureties for said Smith in said supposed writing obligatory; and these defendants say that on this condition only were they to become bound to the plaintiff, and none other; and on this condition they signed it, and put it in said Smith's hands to get the number of other persons he agreed should sign it; and the defendants say they never did acknowledge or deliver said paper to the plaintiff, and never agreed it should be done by the said Smith, except on the conditions aforesaid; yet they say the said Smith, wrongfully and without authority from the defendants, delivered to the plaintiff said supposed writing obligatory, without ever having or procuring any others to sign it with them as co-sureties of said Smith; and said plaintiff wrongfully received and accepted of said Smith said writing, well knowing of the condition aforesaid on which these defendants signed it and delivered it to their co-defendant, Smith; wherefore, they say the said supposed writing obligatory is not their deed, and of this they put themselves on the country.

The plaintiff objected to these pleas when they were offered; but the court overruled the objection.

In the progress of the trial, all the defendants' sureties and others were examined as witnesses, though objected to by the plaintiff, to prove the condition on which the sureties signed the paper, and that the plaintiff had knowledge of this condition, and also that there were other scrolls to it when they signed it; and the plaintiff introduced his own and other evidence to disprove his knowledge, and also the condition of the paper when delivered to him. And when the evidence was introduced before the jury, the court, on the motion of the defendants, gave to them the two following instructions:

The first, called in the record the sixth:

1st. The court instructs the jury that if they believe from the evidence that the defendants, Joseph C. Fugate, James C. Fugate, Robert Johnson, S. P. Munsey, George Banner, J. W. Smith, George C. Gose and Charles G. Gose, signed the covenant sued on, on the condition that it was not to bind them unless others, in addition to them, should sign it also, and was not to be delivered to the plaintiff as their bond until the others, who were to sign it with them, had done so, and placed it in the possession of A. W. Smith, who had also signed it, to be by him delivered to the plaintiff, only on the said condition being complied with, and that the others that were to sign it did not sign it, and that A. W. Smith delivered it to the plaintiff, and that the plaintiff knew, at the time he received it, that the aforesaid defendants signed it on the condition that it was not to be their bond, and was not to be delivered to him, unless the others signed it also, and that the others that were to sign it had not signed it, then the law is for the defendants, and the jury must find for them.

The second, called in the record the seventh:

2d. The court further instructs the jury that if they believe from the evidence that, at the time the said defendants signed the covenant sued on, it had a number of scrolls on it for others to sign their names to as co-obligors with the defendants, and they signed it on the agreement with said A. W. Smith that he was to get other solvent persons than the defendants to sign their names to the scrolls that had no names signed opposite thereto, to become bound with the defendants in said covenant, and that unless he got other solvent persons to sign the covenant as co-obligors with the defendants they were not to be bound by it, and the said Smith was not to deliver it to the plaintiff; and if they further believe from the evidence that Smith did not get the other solvent persons to sign it as co-obligors, and delivered it to the plaintiff with a number of scrolls on it, so placed as to indicate that others were to sign it as co-obligors, that had no names of others signed thereto, then the law is for the defendants, and the jury must find for them.

To the giving of which instructions the plaintiff, by his counsel, objected; but the court overruled his objection, and gave the instructions; to which action of the court the plaintiff excepted.

The jury found a verdict for the defendants; and the plaintiff moved for a new trial; but the court overruled the motion and entered up a judgment in accordance with the verdict. And thereupon the plaintiff applied to a judge of this court for a writ of error and supersedea...