Vanderford v. Farmers' & Mechanics' Nat. Bank of Westminster
| Decision Date | 28 February 1907 |
| Citation | 66 A. 47,105 Md. 164 |
| Parties | VANDERFORD v. FARMERS' & MECHANICS' NAT. BANK OF WESTMINSTER. |
| Court | Maryland Court of Appeals |
Appeal from Circuit Court, Frederick County; James McSherry and John C. Motter, Judges.
Action by the Farmers' & Mechanics' National Bank of Westminster against Florence Leigh Vanderford, as executrix of William H. Vanderford, deceased. From a judgment for plaintiff, defendant appeals. Affirmed.
Argued before BRISCOE, BOYD, BURKE, PEARCE, SCHMUCKER, and ROGERS JJ.
Charles E. Fink, for appellant.
F. Neal Parke and Jas. A. C. Bond, for appellee.
The Farmers' & Mechanics' National Bank of Westminster sued Garnett Savage, Edwin J. Lawyer, and William H Vanderford upon a promissory note dated August 4, 1902, for $300, and payable to the order of the plaintiff in two months from its date. The note is in the following words:
The declaration contains the six common counts, and a special count setting out the note. Vanderford pleaded the general issue pleas, and four special pleas, two of which were pleaded upon equitable grounds. Issue was joined upon the general issue pleas, and a demurrer was filed to the special pleas. The record in the case, upon the suggestion and affidavit of Vanderford, was transmitted to the circuit court for Frederick county for trial. William H. Vanderford having died before the trial, Florence Leigh Vanderford, his executrix, was made party defendant. An additional plea was then filed, to which the plaintiff demurred. The court sustained the demurrer to the third, fourth, fifth, and sixth pleas, and overruled the demurrer to the seventh plea. A traverse was filed to the seventh plea, "with errors of pleading," as the record states, "as to said traverse waived." Issue was joined upon the traverse, and, by consent, the case was tried before the court, and resulted in a verdict and judgment for the plaintiff for the sum of $350.25, from which this appeal was taken.
The defense attempted to be set up by the third, fourth, fifth, and sixth pleas, to which the demurrer was sustained, was that William H. Vanderford was a surety upon said note for Garnett Savage, and was not a joint and several maker thereof with Savage and Lawyer as the terms of the note imported; that the facts of his suretyship on the note was known to the plaintiff at the time the note was executed and delivered; that after the maturity of the note, with the knowledge that Savage was the principal and beneficiary of the note and that the defendant was only a surety thereon, the plaintiff for a valuable consideration paid to it by Savage, and without the knowledge and consent of the defendant and without any reservation of its right to sue on said promissory note, agreed with Savage to extend and did extend the time for the payment of the note until the 4th day of December, 1902, whereby, the pleas aver, the defendant was discharged from the payment of the note, and from all liability thereon. The proposition asserted in these pleas is that where, by the terms of a promissory note, two or more persons are joint and several makers thereof, the mere knowledge by the payee, at or before the execution and delivery of the note, that one is surety for another, will, in connection with such facts as are alleged in the pleas, and which we have stated above, operate to discharge the surety in an action at law brought on the note. Such is certainly not the rule in this state. In Yates v. Donaldson, 5 Md. 402, 61 Am. Dec. 283, this court said that the principle deducible from the cases being, as we think, that where the party does not appear on the instrument to have made himself liable as surety, he cannot at law avail himself of the equities between himself and the other parties to the instrument, unless he was accepted by the creditor as surety, or has been discharged by the acts of the creditor, according to the principles of Glenn v. Smith, 2 Gill. & J. 493, 20 Am. Dec. 452. It will be seen, by reference to the case of Glenn v. Smith, supra, that the principles there announced have no application to the pleadings in this case. Where the facts attending the execution and negotiation of the note bring the case within the rule stated in the cases of Ives v. Bosley, 35 Md. 262, 6 Am. Rep. 411, Owings v. Baker, 54 Md. 82, 39 Am. Rep. 353, and Keyser v. Warfield, 100 Md. 72, 59 A. 189, it would undoubtedly be open to the defendant to show, under the authority of those cases, either under the general issue, or under a special plea in bar, that he was surety on the note, and that he was discharged from liability thereon.
The principle announced in those cases is that if the contract set up is different from that which attached by presumption of law, it must be established by proof that it was the understanding of all the parties to the instrument, and it necessarily follows that if a different contract from that which arises from the terms of the instrument is relied on by special pleas in bar, it must be alleged and proven that such was the understanding of all the parties. This fact the defendant fails to do in either of the special pleas, nor is it stated in either that the bank accepted the defendant as surety, and not as a joint and several maker of the note. Assuming, ex gratia, that such a defense is now open to one who is primarily liable on a note against the payee, we are of the opinion that each of the special pleas for the reasons stated was fatally defective, and that the demurrer thereto was properly sustained. But apart from this ground of objection it seems clear that the negotiable instrument law of 1898 (Acts 1898, p. 206, c. 119; article 13, §§ 13 to 208 inclusive, Code Pub. Gen. Laws 1904), has so modified the prior law upon this subject as to preclude the defendant from setting up his suretyship against the payee of the note. By section 15 of that article William H. Vanderford was primarily liable for...
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