Case ID: tenn_12/html/0194-01.html
Source: Caselaw Access Project
Author: {"author": "Green, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Bell vs. Johnson and Hicks.
    The assignment of a note was as follows: ‘T assign the within to A. B. and guarantee the solvency of the drawer.” Demand and notice were regularly given, but no suit was instituted against the maker, nor was there any proof of his insolvency. Held, that the plaintiff was entitled to recover.
    Hall made a note to M. Bell, who transferred the same in the following words: ££I assign the within note to Johnson and Hicks, and guarantee the solvency of the maker.”
    The day the note fell due, the agent of plaintiffs called at the usual place of residence of the maker of the note, for the purpose of making demand, and was informed there, that he was absent on a visit to Ohio. Bell, the endorser, was informed of this, and notice was given in proper time and manner.
    A suit was then instituted against Bell, and upon the trial, no evidence was offered to show that Hall had left the State, with an intention not to return, or that he was insolvent.
    Defendant proved that Hall was only on a visit to Ohio, and that he had returned and was living in Montgomery county, when Bell was sued, and that he was solvent.
    The judge charged the jury, that the endorsement of Bell to Johnson and Hicks was a common, ordinary endorsement, and required plaintiffs to do nothing more than to malte demand and give him notice, to subject him to suit, and the payment of the money.
    The jury under this charge, found a verdict for plaintiffs. This opinion was excepted to, and a writ of error prosecuted to this court; and the question is, did the transfer require plaintiffs to do any thing more than make demand, and if not paid, to give Bell notice, before they could sue him.
    
      
      J. P. Clark, for plaintiffin error.
    The endorsement required the plaintiffs to do something more than make demand and give notice of the non-payment to Bell. '
    It is well settled that a party can make a transfer in blank, in full, or restrictive and conditional, and when so made, that the endorsee takes it, subject to such restriction or condition. Chitty on Bills, 170,176 and 180.
    If the law permit such endorsements, and parties make them, it is the duty of courts to enforce them as made; otherwise, they would be making, instead of expounding contracts. Vide 4 Bibb, 286: 7 Mass. 479: 12 Mass. 14: 19 John. 69: 2 Com. Law Rep. 580: 2 Mur. 47.
    
      F. B. Fogg, for defendant.
    There are no authorities on this point, known to the counsel for plaintiff below. The note was endorsed before due; it is like an endorsement in the ordinary way, except the guarantee of solvency. What effect does that produce? The absence from the State at the time of the note’s becoming due, shows that no suit could have been brought. This addition to the endorsement does not change the nature ofthe contract; it is still an endorsement of a negotiable instrument before due. It might perhaps be an evidence of demand and notice.
   Green, J.

delivered the opinion of the court.

Michael Hall executed to Montgomery Bell, his note, under seal, in the following words: “Nine months after date, I promise to pay M. Bell, or order, one hundred and fifty dollars, for value received; witness my hand and seal, this 18th Nov. 1829.

Michael Hall.” [Seal.]

This note Bell assigned to Johnson and Hicks, in the following words: “I assign the within to J. Johnson and A. W. Hicks, and guarantee the solvency of the drawer. May 22d, 1830. M. Bell.”

^ie ^a7 ^Ie note became due, the agent of Johnson and Hicks went to the Tennessee iron works, where Hall, the maker of the note, had usually resided, to demand payment. Hall was not there, and upon enquiry of the clerk of the iron works, the said agent ascertained that Hall had left the country two or three weeks before, and had gone to Missouri or Ohio. Upon enquiry of the clerk, the agent was informed that no provision had been made for the payment of the note. The said agent addressed a letter to .Bell? informing him of the application at the iron works, and the failure to get payment, and the same day put it into the post master’s hands at the iron works, and requested him to send it by the first mail to Nashville, near which place Bell lived.

The plaintiffs brought no suit against Hall, nor did they introduce any proof to show that he was insolvent; and the only question in the case is, whether they were bound to do so by the terms of the assignment, before they can recover of Bell.

■ It is true, as contended for by the counsel for Bell, that the payee of a note may make an assignment, by which to protect himself altogether from liability; or by which the liability is only to attach, upon the performance by the assignee of some stipulated condition. The assignment is a contract between_the parties, and they may make it of any character they please; but the general rules which govern endorsements of negotiable paper, will prevail m all cases, where there is not a clear expression of the intention of the endorser to control those rules,, and to subject himself to liability upon other conditions.

• The enquiry presents itself, then, upon the language used in this assignment, whether such intention is here expressed. He says, <£I assign the within note to J. Johnson and A. W. Hicks, and guarantee the solvency of the drawer.” What does he mean by these latter words? Do they express an intention to restrict his liability? We think not. On the contrary, they were intended to enlarge it, and give the assignees more ample means of holding him responsible. Had they failed to make demand and give notice, so as to fix his responsibility upon the endorsement, still they might have recovered of him upon this guarantee, provided they could show by suit or otherwise, the insolvency of Hall.

This we think must be the meaning of these words, if they were intended at all to vary the undertaking from that arising upon an ordinary endorsement.

Let the judgment be affirmed.

Judgment affirmed.