Case ID: miss_20/html/0602-01.html
Source: Caselaw Access Project
Author: {"author": "Mr. Justice ThacheR", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

James M. Dunn et al. vs. James H. Smith et al.
    To an action on a note by an indorsee, one of the makers plead that his signature to the note was procured by fraud in this, viz : the payee presented the note to him, to sign as surety for its payment, falsely representing that one W. would become co-surety with him ; on the faith of this he signed it, but W. had never done so; held, on demurrer, that the defence was a good one ; the fraud was the act of the payee, and the note so procured was void at law, not only in the hands of the payee, but of all claiming under him.
    In error from the circuit court of Carroll county; Hon. Hugh R. Miller, judge.
    James H. Smith and Joseph W. Carroll sued James M. Dunn and Andrew W. Caperton, partners under the firm of Dunn & Caperton, Barnabas Furney and Rufus C. R. Petty, as makers, and Andrew W. Caperton indorser, of a note. The defendants plead non-assumpsit, and Petty this farther plea, viz: “ That A. W. Caperton, to whose order the said note was to be paid, presented the same to this defendant to sign as security for the payment thereof, and to induce this defendant to sign the same, as security, did falsely represent that Wallis Wilson would also sign and execute the same, as a co-security with this defendant; and on such representations this defendant did execute the same; and this defendant avers that said Wallis Wilson never executed said note, or in any manner became bopnd or liable for its payment; and this he is ready to verify,” &c.
    
      The plaintiff demurred, and the court below sustained the demurrer; whereupon the defendants withdrew their other plea, and the court rendered a judgment final against them; and they sued out this writ of error.
    Sheppard, for plaintiffs in error,
    cited Graves v. Tucker, 10 S. & M. 9.
    Cothran, for defendants in error,
    relied on the same authority.
   Mr. Justice ThacheR

delivered the opinion of the court.

In an action upon a promissory note, one of the defendants, Rufus C. R. Petty pleaded that the note was procured to be made by him by fraud and deceit, in this, that Andrew W. Ca-perton, to whose order the note was to be paid, presented the same to him' to sign as security for its payment,, and to induce him to sign it as security, falsely represented that one Wallis Wilson would also sign it, as a co-security with him, and upon this representation he did so sign it; but that the said Wilson never did sign the note, or in any manner become liable or bound for its payment. A demurrer to this plea was sustained, which judgment is now for investigation here.

The plea presents a palpable case of misrepresentation to a surety in respect to a material part of the transaction in which he was solicited to become surety. It was the act of the payee of the note. Under such circumstances the security so given is void at law, for fraud. Graves v. Tucker, 10 S. & M. 9.

It being the act of the payee, the indorser, his fraud equally affects his indorsees, the holders and plaintiffs, who claim through him. H. & H. 373, sec. 12.

The judgment of the circuit court sustaining the demurrer was erroneous.

The judgment is reversed, the demurrer directed to be overruled, and the cause remanded for further proceedings.