Van Hoose v. Southwestern Mach. Co.

• Decision Date: 03 March 1913
• Citation: 169 Mo. App. 54,154 S.W. 165
• Parties: VAN HOOSE v. SOUTHWESTERN MACH. CO. et al.
• Court: Missouri Court of Appeals

154 S.W. 165

169 Mo. App. 54

VAN HOOSE v. SOUTHWESTERN MACH. CO. et al.

Springfield Court of Appeals. Missouri.

March 3, 1913.

1. APPEAL AND ERROR (§ 1015) — GRANTING NEW TRIAL — EVIDENCE.

Where the evidence was conflicting, the appellate court will not interfere with the action of the trial court in setting aside a verdict on the ground that the evidence did not sustain it.

2. NEW TRIAL (§ 65) — GROUNDS — DISCRETION.

The trial court in its discretion should grant a new trial if the verdict is against the weight of the evidence, arbitrary, or manifestly wrong, or appears to be the result of passion, prejudice or misconduct of the jury.

3. PRINCIPAL AND SURETY (§§ 185, 194) — PART PAYMENT BY SURETY — EFFECT — BILLS AND NOTES.

Where two sureties paid part of a note, they did not thereby become part owners of it so as to give them a right to sue their principal and cosureties upon it, but they were entitled merely to a credit on the note for the amount paid.

4. BILLS AND NOTES (§ 426) — PAYMENT AND PURCHASE.

Where two sureties and two strangers to a note paid the amount thereof to a bank which held it without any apparent intention of discharging it, and where pursuant to an authorization entered on the minutes of the bank, the note was indorsed to their agent, the transaction was a purchase of the note, and not a payment as to the two strangers.

5. DISMISSAL AND NONSUIT (§ 25) — VOLUNTARY DISMISSAL OF CODEFENDANTS — RELEASE OF SURETIES ON NOTES.

Where an action was brought against the principal and certain sureties on a note by the agent of two sureties and of two strangers to it, who had paid the note and taken an assignment, a dismissal of the action as to the two sureties did not release them from their original obligation, and hence did not release defendants from their liability on the note.

Appeal from Circuit Court, Jasper County; David E. Blair, Judge.

Action by J. H. Van Hoose against the Southwestern Machinery Company and others. From an order granting a new trial after verdict and judgment for defendants, defendants appeal. Remanded for trial, with directions.

The plaintiff on May 13, 1910, filed a petition in the circuit court of Jasper county against the Southwestern Machinery Company, A. E. Bendelari, A. Galamba, William Fahrman, and George Hardy, together with other defendants unnecessary to be named in this opinion. The suit was instituted for a balance due on a promissory note for $7,500, with interest. The note in question was signed by the Southwestern Machinery Company as principal, and the defendants herein named as sureties, together with a number of the other defendants who were sureties. No answer was filed except by A. E. Bendelari and A. Galamba, each of them filing separate answers. The case was tried before a jury, and resulted in a verdict and judgment in favor of the defendants Bendelari and Galamba. However, the court sustained a motion for a new trial, and set aside the judgment for the reason that it was against the weight of the evidence, and the appeal is by said defendants from that order.

The facts in the case are substantially as follows: The Southwestern Machinery Company was indebted to the Merchants' & Miners' Bank of Webb City, Mo., in the sum of $13,000, evidenced by three promissory notes, two of them being for $2,500 each, and one for $8,000, and it is with the latter that we have to do in this case. On this note there was credited a payment of $500. In addition to the name of the Southwestern Machinery Company, there appears on said note as sureties the names of the defendants herein, together with other stockholders of said machinery company. In October, 1907, when the bank was insisting on the payment of this note, four of the stockholders of the machinery company, to wit, George Hardy, William Fahrman, Ben Aylor, and Allen Hardy, Jr., the two first named being on the note to the bank as sureties, and two last named not being on said note, according to their testimony agreed to each advance a one-fourth part of the amount necessary to take up said note, and that this agreement was carried out on or about January 16, 1908; that the money which they advanced was deposited in the bank to the credit of J. H. Van Hoose, who was a partner in the real estate business with Ben Aylor, and officed with him, and from the testimony undoubtedly sustained very friendly relations with all four of the men who put up the money with which to take care of the $8,000 note in the bank, and the note was assigned by the bank to Van Hoose. He held the note from January 16, 1908, until the beginning of this suit, making no attempt to collect from the machinery company or from any of the sureties until probably a short time before suit was commenced, at which time he demanded payment of the two appealing defendants. There is no doubt as to Van Hoose being the agent of these four men, and it is clear that he had no personal interest in the note nor any personal interest in the outcome of this litigation.

The evidence also discloses that said machinery company had become involved to other creditors (the debts being designated in the record "commercial bills") in an amount to exceed $20,000; that, in order to take care of this indebtedness for the machinery company, Aylor, with some of the stockholders, executed a note to the same bank for $10,000 and that Allen Hardy, Jr., together with some of the stockholders executed a similar note to the same bank for the same amount, the reason for this course being that the bank could not loan that great an amount of money to the machinery company. The $20,000 was placed to the credit of the machinery company, and paid out on these "commercial bills." Then the officers of the machinery company, to wit, Ben Aylor, Allen Hardy, Jr., George Hardy, and William Fahrman, began to reduce the property of the machinery company to cash, and such proceeds as were realized were applied on their indebtedness to the bank, which indebtedness, as stated, had been created for the purpose of settling the company's debts. They applied probably $6,000 on each note in this way. They also allowed the bank to get judgments against the company on the two $2,500 notes, and permitted to be sold at execution sale certain of the company's property, at which sale the two appealing defendants were present, as were Ben Aylor and Allen Hardy, Jr.

The trial was begun on March 21, 1911, and was in progress until the 23d, on which day the jury failed to agree. During that trial and on the 22d day of March, plaintiff dismissed the cause as to defendants William Fahrman and George Hardy. On June 20, 1911, it was agreed between plaintiff and the two appealing defendants herein that the case would be continued until the next term of court, and at the next term, which was in November, the case was again tried and resulted in a verdict for the defendants. As we have stated, the appeal is from the order granting plaintiff a new trial.

Frank L. Forlow, of Webb City, and McIndoe & Thurman, of Joplin, for appellants. A. E. Spencer and R. M. Sheppard, of Joplin, for respondent.

FARRINGTON, J. (after stating the facts as above).

The appellants contend (1) that there is no theory under the pleadings and the evidence on which a judgment could be rendered in favor of the plaintiff and against these defendants, and for that reason ask this court to direct the circuit court to enter a judgment in their favor, or render judgment in their favor in this court; (2) that this action cannot be maintained because Van Hoose was the agent of or trustee for Ben Aylor, Allen Hardy, Jr., William Fahrman, and ...