Case ID: johns_15/html/0433-01.html
Source: Caselaw Access Project
Author: {"author": "Spencer, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Fulton against Matthews and Wedge.
    A surety is not discharged by the plaintiff's giving time to the principal debtor, or even by his discontinuing a suit commenced against the principal, without the privity and consent of the surety, unless the surety has explicitly required him to proceed against the principal, or the plaintiff" has, by some agreement with the principal, precluded himself from suing him.
    THIS was an action of assumpsit on a promissory note, dated October 25th, 1815, by which the defendant Wedge promised to pay W. Atherton, or order, 85 dollars, by the first of January next, with interest. The note was signed by Wedge, and underneath his name was subscribed the name of the defendant Matthews, in the following manner: “ Thos. Matthews, security.” On the note was indorsed an assignment from the payee to the plaintiff, dated November 11th, 1817. The cause was tried before Mr. J. Platt, at the Steuben circuit, in June, 1818.-
    O11 the part of the defendant Matthews, who alone had been brought into court, it was proved, that in the autumn before the note became due, Wedge called on the payee, and offered to pay him 50 or 55 dollars, on account of the note, in Pennsylvania bank notes; but as they were depreciated in value, Atherton declined taking them, and promised to wait until the next spring for payment. In July, 1816, Atherton placed the note for collection in the hands of an attorney in Steuben county, who commenced a suit upon it in the Court of Common Pleas of that county, in which suit Matthews pleaded, and a default was entered against 
      Wedge. Before any trial in the cause, Atherton took the note out °f the hands of the attorney, and directed him to desist from proceeding in the suit, in consequence of which, Alher-ton afterwards became nonsuited. It did not appear that Matthews was privy to this transaction. Wedge, who had previously been solvent, was, at-the time the former suit was suspended, reputed to be insolvent, and afterwards obtained his discharg e under the insolvent law, and had since left the state.
    
      A verdict was found for the plaintiff, subject to the opinion of the court, and the case was submitted, on the points and arguments stated to the court, without argument.
   Spencer, J.

delivered the opinion of the court. This suit is on a negotiable note, signed by Wedge, and by Matthews, to whose signature is attached the word “ security.”

The defence relied on was, that the payee of the note, after it became due, and before it was endorsed, had given time to the principal; and that a suit had been brought by the original payee of the note, in Steuben Common Pleas, which suit was, afterwards, discontinued; and that, probably, had the suit proceeded, a recovery might have been had against Wedge, who is now insolvent, and has left the state. It does not appear that Matthews ever requested the payee, or the plaintiff, to sue Wedge.

In Pain v. Packard, (13 Johns. Rep. 174.) we say; that a mere delay in calling on the principal, will not discharge the surety ; and in that case, the opinion of the court was placed wholly on the fact, that the surety requested the holder of the note to proceed and collect it from the principal ; and the plea averred a loss of the money as against the princij al, by such neglect. In this case there is no proof whatever, that Matthews, the surety, ever urged, or requested, the holder of the note to proceed against the principal; and the proof is very doubtful whether, when the suit was actually commenced in the Common Pleas, Wedge was able to pay the money.

The holder of a note ought to be fairly and fully apprised by the surety that he is required to prosecute the principal. A delay to sue, or even a discoritinuanee of a suit brought, cannot absolve the surety from his liability, if he is passive, and takes no measures indicating to the holder of a note, that he insists on his proceeding against the principal. It ought to be put beyond a doubt, that the surety is injured by the delay, that is, that the principal was solvent and able to pay the debt, if he had been prosecuted for it. The plaintiff has done no act to preclude himself from suing Wedge, at any time. On the grounds, then, that the plaintiff has never been required to prosecute Wedge, and that he has made no contract with him, that disables him from suing at any time, we are of opinion that the plaintiff must have judgment.

Judgment for the plaintiff. 
      
      
         Vide King v. Baldwin & Fowler, 2 Johns. Ch. Rep. 554. In Orme v Young, (Holt's N. P. Rep. 84.) Gibbs, Ch. J says, “ The defence which may be set up by a surety, of time given to the principal, is borrowed from a court of equity; there if a day of payment be given to the debtor, the sureties are discharged. It is the equitable right of sureties to come into a court of equity and demand to sue in the name «f the creditor. Now, if the creditor have given time to his debtor, the surety cannot sue him.” And he adds, “ what is forbearance and giving time ? It is an engagement which ties the hands of the creditor. It is not negatively refraining; not exacting the money at the time; but it is the act of the creditor depriving himself of the power of suing by something obligatory, which prevents the surety from coming into a court of equity for relief; because the principal, having tied his own hands, the surety cannot release them.” Et vide Hunt v. United States, 1 Gallist Rep. 32. per Stoby, J.