Case ID: hill_2/html/0139-01.html
Source: Caselaw Access Project
Author: {"author": "Cowen, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Loveland vs. Shepard.
    A guaranty of an endorsed note was thus—“ I guaranty the collection of the within noteHeld that, in an action on the guaranty, the plaintiff must show a diligent attempt to collect, both as against the endorser and maker, or he could not recover.
    Assumpsit, tried at the Niagara circuit, in October, 1840, before Dayton, 0. Judge. The action was on a guaranty of a promissory note, made by J. D. Jennings, payable to the order of S. Jennings, and by him endorsed in blank. On this the defendant endorsed a guaranty thus: “ For a valuable consideration, I guaranty the collection of the within note. Lockport, August 8th, 1837. (Signed) G. Shepard.”
    The only proceedings to collect the note proved at the trial, were against the maker. It was objected that no diligence had been used in respect to the endorser; but the circuit judge held that none was necessary, as the guaranty was of the collection of the note only; not of the note and endorsement. To this the defendant excepted; and a verdict having passed against him, he now moved for a new trial on a bill of exceptions.
    
      A. C. Bradley, for the defendant.
    
      A. A. Boyce, for the plaintiff.
   By the Court,

Cowen, J.

In a suit on a somewhat similar guaranty in Moakley v. Riggs, (19 John. Rep. 69, 71,) it appeared that the endorser alone had been sued. Spencer, Ch. J. said, the plaintiff was bound to prosecute with due diligence all the parties to the note. It is true, the question whether a prosecution against the endorser was essential did not arise. The necessity of suing both parties was, however, asserted, and the dictum is highly respectable. I cannot but think it accorded with the intentian of the guarantor. “ The within note,” here spoken of by the guarantor before us, was an endorsed note; whereas the plaintiff’s counsel would read it “ the within note, irrespective of the endorsement.” A note is shown to another with the name of a responsible endorser upon it, and he. is asked whether it be collectable ? He answers' yes. Can there be a doubt that he means the paper? It is true, the note and endorsement are distinct contracts, but they are not independent. The endorsement is collateral to the note, the. maker being the principal or primary party. A transfer of the note eo nomine, would carry the endorsement as an incident; and a release of the maker would discharge the endorser. In the case before us,, is there any question, that had the plaintiff collected the "money of the endorser,, it would have discharged the defendant? Why? Because it would have been a collection of the money in the terms of the guaranty. In the language of Moakley v. Riggs we speak of endorsers as parties to the note.

The construction of this contract by the learned judge was, we think, too narrow.

There must be a new trial, the costs to abide the event.

New" trial granted.