Shows v. Jackson

• Decision Date: 17 November 1926
• Docket Number: 3 Div. 743
• Parties: SHOWS v. JACKSON, Superintendent of Banks.
• Court: Alabama Supreme Court

110 So. 273

215 Ala. 256

SHOWS v. JACKSON, Superintendent of Banks.

3 Div. 743

Supreme Court of Alabama

November 17, 1926

Appeal from Circuit Court, Montgomery County; Walter B. Jones Judge.

Action on promissory note by A.E. Jackson, as Superintendent of Banks for the State of Alabama, administering the affairs of the Merchants' Bank, against T.W. Shows. From a judgment for plaintiff, defendant appeals. Reversed and remanded.

James J. Mayfield and Henry C. Meader, both of Montgomery, for appellant.

Steiner Crum & Weil, of Montgomery, for appellee.

THOMAS J.

The trial of the facts was had before the court without a jury and the evidence was ore tenus. The result of such a trial will not be disturbed unless clearly wrong or contrary to the great weight of the evidence. Fleming v. Moore, 213 Ala. 592, 105 So. 679, 682; Perry v. Marbury Lbr Co., 212 Ala. 542, 103 So. 580; Bice v. Robinson, 210 Ala. 471, 98 So. 462; Hodge v. Joy, 207 Ala. 198, 92 So. 171; McClurkin v. McClurkin, 206 Ala. 513, 90 So. 917; Brassell v. Brassell, 205 Ala. 201, 87 So. 347; Hackett v. Cash, 196 Ala. 403, 72 So. 52. In such case the finding of fact is accorded the same presumption as the verdict of a jury. N.C. & St. L. Ry. Co. v. Crosby, 194 Ala. 338, 349, 70 So. 7; Cobb v. Malone, 92 Ala. 630, 9 So. 738.

Appellee sued appellant in the circuit court of Montgomery county seeking to recover from him as indorser of a negotiable promissory note executed by the Bank of Luverne, as maker, to the Merchants' Bank of Montgomery, on September 21, 1921, and payable on October 21, 1921, indorsed on the back by appellant-defendant. On the face of the note appeared the following:

"The parties to this note, whether maker, indorser, surety or guarantor, each for himself, hereby severally waive as to this debt, or any renewal thereof, all right of exemption under the Constitution and laws of Alabama or any other state as to personal property, and they each severally agree to pay all costs of collecting or securing, or attempting to collect or secure this note, including a reasonable attorney's fee whether the same be collected or secured by suit or otherwise. And the maker, indorser, surety or guarantor of this note severally waives demand, presentment, protest, notice of protest, suit and all other requirements necessary to hold them, and they agree that time of payment may be extended without notice to them of such extension. The bank at which this note is payable is hereby authorized to apply on or after maturity, to the payment of this debt any funds in said bank belonging to the maker, surety, indorser, guarantor or any one of them. And should it become necessary to sue on this note, the owner thereof may bring suit thereon against the maker or indorser, or both, either in Montgomery county, Ala., or in the county of our residence, although the maker or indorser may not be or have been a resident of Montgomery county, Ala."

On the back of the said note was printed the following language:

"Each indorser of this note hereby waives all right of exemptions as to personal property, and agrees to pay a reasonable attorney's fee for collecting or attempting to collect this debt; also waives notice of demand, protest and nonpayment." Beneath this language on the back of said note appears the indorsement of T.W. Shows, the defendant. At the time of making said note, and at all times subsequent thereto, said indorser, Shows, was a resident of Crenshaw county, Ala.

The defendant appeared specially and duly filed the four pleas in abatement (numbered 1, 2, 12, and 14) exhibited by the record. The first plea in abatement took the point that the defendant, as indorser, had never contracted away or waived his right to be sued in the county of his residence, Crenshaw county. The second set up the Act of 1923, approved February 10, 1923, p. 55, amending section 6110 of the Code of 1907 by adding thereto the following language:

"Any agreement or stipulation, verbal or written, whereby the venue herein prescribed is proposed to be altered or changed so that suits may be brought contrary to the provisions of this section, is void."

This act was in effect prior to the filing of this suit. Pleas 12 and 14 set up the fact that defendant was a resident of Crenshaw county, and not a resident of Montgomery county. Demurrers to all of defendant's pleas in abatement having been sustained, all pleas to the merits were withdrawn, and defendant pleaded in short by consent any matter that might be-specially pleaded, with leave on the part of the plaintiff to reply in like manner, the same in all respects as if pleaded at length.

Assignments of error 1 to 6, inclusive, are directed to the action of the court in sustaining demurrers to defendant's plea in abatement 1, which plea took the point that the indorser had not waived his right to be sued in the county of his residence, and that such waiver was no part of the contract which he had entered into. It has been held by this court that a waiver of exemptions contained in the face of a note is not binding on one indorsing said note on the back thereof under the provisions of the statute (Code 1907, § 5021). Jordan v. Long, 109 Ala. 414, 417, 19 So. 843; Consolidated, etc., Co. v. Malik, 207 Ala. 120, 92 So. 262; Scarbrough v. Anniston City Nat. Bank, 157 Ala. 577, 582, 583, 48 So. 62, 131 Am.St.Rep. 71. It is settled that:

"These stipulations imported by the indorsement constitute a new contract, independent of that evidenced by the contract of the maker of the note, based upon a new and independent consideration, and imposing liabilities and obligations on the indorser which do not rest upon the maker. 2 Rand. Com. Paper, § 739; Tied. Com. Paper, § 256; Daniel Neg.Instr. § 669; Byles on Bills, 153; McGhee v. Importers' & Traders' Bank, 92 Ala. 192, 194 ;" Jordan v. Long, 109 Ala. 414, 417, 19 So. 843, 844.

In Schillinger v. Leary, 201 Ala. 256, 258, 77 So. 846, 848, it is said:

"Under our statute a joint action against the maker and the indorser of a promissory note cannot be maintained, since the obligation of each is several, and the liability of each is dependent upon different conditions."

The indorsement in question, and the statute to be read therein, made the warranty to those subsequently holding in due course that: (1) The instrument was genuine as it purported to be; (2) the negotiator had a good title to it; (3) all prior parties thereto had capacity to contract in the premises; (4) the instrument at the time of his indorsement was valid and subsisting; and (5) he "engages that on due presentment it shall be accepted or paid, or both, as the case may be, according to its tenor, and that if it be dishonored and the necessary proceedings on dishonor be duly taken, he will pay the amount thereof to the holder, or to any subsequent indorser who may be compelled to pay it."

It is further provided by section 5022, Code of 1907:

"Where a person places his indorsement on an instrument negotiable by delivery he incurs all the liabilities of an indorser."

The Negotiable Instruments Act further say that notice of dishonor may be waived, and that where waived in the instrument it is binding upon all part...