Case ID: ad_149/html/0029-01.html
Source: Caselaw Access Project
Author: {"author": "Miller, J.:", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Thomas M. Mulry and James J. Larkin, as Executors, etc., of John Fleming, Deceased, Respondents, v. John C. R. Eckerson, Appellant.
    First Department,
    February 2, 1912.
    Guaranty and suretyship — dissolution of partnership—undertaking by remaining partner to pay firm debts — action against surety — proof of judgments against firm.
    A judgment against a principal is not even evidence against his surety unless the latter had notice of the suit and an opportunity to defend, except in the case of a covenant to indemnify against the consequences of a suit.
    
      Thus, in an action against the surety on an undertaking given on the dissolution of a partnership providing- that the remaining partner “shall well and truly pay - * * all commercial debts and bills payable by said copartnership,” it is reversible error to permit plaintiff to prove over objection and exception that judgments had been recovered against the partnership subsequent to the giving of the undertaking.
    Where there was no attempt to prove either the existence of claims covered by the undertaking or that the defendant had notice of the suits in which the judgments were recovered a judgment in plaintiff’s favor will be reversed.
    Appeal by the defendant, JohnO. E. Eckerson, from a judgment of the Supreme Court in favor of the plaintiffs, entered in the office of the clerk of the county of Eew York on the 7th day of January, 1911, upon the report of a referee appointed to hear and determine the issues.
    
      William J. Wallace, for the appellant.
    
      Arthur J. McClure, for the respondents.
   Miller, J.:

The plaintiff’s testator, John Fleming, and Charles A. Brown were copartners. Fleming sold his interest to Brown and the latter assumed and agreed to pay the copartnership debts. The defendant joined him in an undertaking to Fleming, the condition of which was: “The said Charles A. Brown shall' well and truly pay within six months from the date hereof all commercial debts and bills payable by said copartnership of Brown & Fleming and the expenses and debts of said James J. Coogan, as receiver of the property of Brown & Fleming, other than claims in judgment and in tort, and also claims upon notes upon which the copartnership of Brown & Fleming was accom • modation endorsers.” This action is brought on that undertaking. The complaint alleged the existence of certain partnership debts stated, the failure of Brown to pay, the commencement of actions against Brown & Fleming, notice thereof to the defendant, and the recovery of judgments therein. The answer denied the existence of debts covered by the undertaking and the notice of the actions. On the trial the plaintiffs were permitted to prove, over the defendant’s objection and exception, the judgments recovered against Brown & Fleming, and upon that proof was given a judgment for $4-9,496.52 damages.

It is the law in this State that a judgment against the principal is not even evidence against his surety unless the latter had notice of the suit and an opportunity to defend. (Douglass v. Howland, 24 Wend. 35; Berry v. Schaad, 50 App. Div. 132; Loewer’s Gambrinus Brewing Co. v. Lithauer, 43 Misc. Rep. 683.) The exception is where the covenant is to indemnify against the consequences of a suit. (See Bridgeport Ins. Co. v. Wilson, 34 N. Y. 275.)

There was no attempt to prove either the existence of claims covered by the undertaking, with one exception, or that the defendant had notice of the suits in which the judgments were recovered.

The judgment should he reversed and a new trial ordered before another referee, with costs to appellant to abide the event.

Ifg-raham, P. J., Lafghlif, Clarice and Scott, JJ., concurred.

Judgment reversed, new trial ordered before another referee, with costs to appellant to abide event. Order to be settled on notice.