Siemans & Halske Electric Co. v. Ten Broek

• Decision Date: 09 December 1902
• Citation: 70 S.W. 1092,97 Mo. App. 173
• Court: Missouri Court of Appeals
• Parties: SIEMANS & HALSKE ELECTRIC CO. OF AMERICA v. TEN BROEK.<SMALL><SUP>*</SUP></SMALL>

70 S.W. 1092

97 Mo. App. 173

SIEMANS & HALSKE ELECTRIC CO. OF AMERICA v. TEN BROEK.^*

Court of Appeals at St. Louis, Missouri.

December 9, 1902.

NOTE — CONSIDERATION — CONSTRUCTION — LIABILITY OF PARTIES — PRESUMPTIONS.

1. The surrender of a note is a good consideration for the making of another.

2. Where a note is surrendered, and a new one given, the new note is a new contract, and not a continuation of the old one; and the question of the liability of a party thereto as maker or indorser must be ascertained from the position his name occupies on the new note, without regard to the nature of his liability on the old one.

3. Where there is no evidence that it was understood when a party signed a note that he signed it as an indorser, or that he should be treated as an indorser, the presumption of law is that he signed it as a maker.

Appeal from St. Louis circuit court; Selden P. Spencer, Judge.

Action by the Siemans & Halske Electric Company of America against Gerrit H. Ten Broek. Judgment for plaintiff. Defendant appeals. Affirmed.

H. M. Wilcox, for appellant. Lee W. Grant, for respondent.

BLAND, P. J.

In the spring of 1899 the Holland Building Company, a corporation, was insolvent and in the hands of a receiver. The appellant was its president. In settlement of a part of plaintiff's claim, the Holland Building Company, by its president, executed to plaintiff four promissory notes, of $100 each. Each of the notes were, before delivery, indorsed on the back by appellant and L. C. Spooner. Two of the notes were paid by the Holland Building Company. The other two notes were protested for nonpayment, and notice thereof duly given to the appellant and Spooner. Subsequently one of these notes was paid by appellant, and the other was surrendered up, and a new note given for the same amount, signed and indorsed as was the original. This note was not paid at maturity, nor was it protested for nonpayment, nor was notice of its nonpayment given to appellant. The suit, which is on this note, was commenced before a justice of the peace, where judgment was rendered by default against the Holland Building Company and appellant. Mr. Spooner was not made a party to the suit. An appeal was taken by Ten Broek to the circuit court, where, on a trial anew, judgment was again rendered for the plaintiff, from which Ten Broek appealed.

The contention of appellant is that he indorsed the original notes on the back thereof as an indorser, and not as a maker, and that it was so agreed and understood by him and plaintiff's agent, who took the original notes. Ten Broek's evidence tends to prove that such was the understanding. His evidence, and the fact that he was treated as an indorser, and not as a maker, by the plaintiff (evidenced by the fact that plaintiff had the original note protested for nonpayment, and notice given thereof to Ten Broek), we think, tends to overthrow the presumption that he indorsed the original notes as a maker. The trial court, by its declarations of law, held, in substance, that it was immaterial in what capacity appellant indorsed the original note; that his liability became absolutely fixed when the note was protested for nonpayment; and that, in the absence of an agreement that he was to be held as an indorser, only, on the renewed note, the law presumed him to be a maker. The correctness of this ruling is the only material question to be considered.

The surrender of one note is a good consideration for the making of another one. 1 Rand. Com. Paper, § 459. Appellant's liability on the surrendered note, whether he be regarded as maker or indorser, was fixed and absolute. The surrender of the original note was, as to him, a good consideration for his making the new one. As a general proposition, the renewal of a note is not payment. 3 Rand. Com. Paper, § 1511; 2 Daniel, Neg. Inst. p. 289; Appleton v. Kennon, 19...