Stewart v. Am. Exch. Nat. Bank of Lincoln

• Decision Date: 08 April 1898
• Citation: 54 Neb. 461,74 N.W. 865
• Parties: STEWART ET AL. v. AMERICAN EXCH. NAT. BANK OF LINCOLN.
• Court: Nebraska Supreme Court

54 Neb. 461

74 N.W. 865

STEWART ET AL.

v.AMERICAN EXCH. NAT. BANK OF LINCOLN.

Supreme Court of Nebraska.

April 8, 1898.

Syllabus by the Court.

1. All material averments of new matter in an answer, which are not denied by the reply, will be taken as admitted, and need not be proved.

2. Where, after reply, an amended answer is filed setting up the defense interposed in the original answer, and, in addition, facts which constitute a new and distinct defense, the plaintiff may reply anew, if he so elects; but, if he does not, the reply to the original answer will not stand as a reply to such new or additional defense.

3. Section 440 of the Code of Civil Procedure requires judgment to be rendered in favor of the party entitled thereto by the pleadings, notwithstanding a verdict has been returned against him.

4. A creditor who, without the consent of the surety, voluntarily parts with the security, thereby releases the surety to the extent he has been thereby damaged.

Error to district court, Lancaster county; Tibbets, Judge.

Action by the American Exchange National Bank of Lincoln against Lou L. E. Stewart and R. A. Stewart. Judgment for plaintiff, and R. A. Stewart brings error. Reversed.A. J. Cornish and Willard E. Stewart, for plaintiff in error.

Sawyer, Snell & Frost, for defendant in error.

NORVAL, J.

This suit was brought in the court below by the American Exchange National Bank of Lincoln against Lou L. E. Stewart and R. A. Stewart on a promissory note for $1,000 bearing date May 15, 1893, due in 90 days, with interest at 10 per cent. per annum from date until paid. Lou L. E. Stewart made default. R. A. Stewart, for answer, alleged that he signed the note as surety merely, and that, without his consent, plaintiff, for a valuable consideration, received from Lou L. E. Stewart, extended the time of payment of the note. The bank replied by a general denial. Prior to the trial, R. A. Stewart, by leave of court, filed an amended answer, which set up the same defense as contained in the original answer, and, in addition, pleaded that the bank held certain notes, aggregating $3,000, as collateral to the one sued on, which it surrendered to the principal maker, Lou L. E. Stewart, to the damage of the answering defendant. No reply was filed to the amended answer. Verdict and judgment for plaintiff, and defendant R. A. Stewart prosecutes error proceeding to this court.

One ground urged for reversal is that the defendant surety was, by the pleadings, entitled to recover judgment, which proposition is unanswerable. Under section 134 of the Code of Civil Procedure, every material allegation of new matter contained in the answer, not put in issue by a reply, must be taken as true. Dillon v. Russell, 5 Neb. 484; Williams v. Evans, 6 Neb. 216; Payne v. Briggs, 8 Neb. 75; Consaul v. Sheldon, 35 Neb. 247, 52 N. W. 1104;Lumber Co. v. Ashby, 41 Neb. 292, 59 N. W. 913;Van Etten v. Kosters, 48 Neb. 152, 66 N. W. 1106;Scofield v. Clark, 48 Neb. 711, 67 N. W. 754;Power Co. v. Cox (Neb.) 73 N. W. 9;Hartzell v. McClurg & Co., 53 Neb. ___, 74 N. W. 625. Two defenses were well pleaded in the amended answer,--the release of the surety by the payee extending the time of payment of the note to the principal maker, and the surrender and release of collaterals held as surety for the payment of the note. By the plaintiff failing to reply to the amended answer, the second defense, under the statute and authorities, must be regarded as confessed. It is suggested in argument by counsel for plaintiff below that reply to the original answer should be treated as a reply to the amended one. Possibly it might have been thus regarded had it been refiled as a reply, but without such refiling it certainly cannot be so considered as to the new defense which was not interposed in the first or original answer. An amended answer having been filed, plaintiff had the undoubted right to plead over if it so desired, or to stand upon its reply previously filed. Having elected to adopt the latter course, the reply to the original answer should not be considered as a reply to the amended answer, as to the new or additional facts or cause of action set forth in the amended pleading which were not contained in the original. Eslich v. Railway Co., 75 Iowa, 443, 39 N. W. 700;Wilson v. Preston, 15 Iowa, 246;McAllister v. Ball, 28 Ill. 210;Ermentrout v. Insurance Co., 63 Minn. 194, 65 N. W. 270;Kelly...