Case ID: sw_166/html/0128-01.html
Source: Caselaw Access Project
Author: {"author": "SPEER, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

SHEPHERD et al. v. MOTT.
    (No. 7857.)
    (Court of Civil Appeals of Texas. Ft. Worth.
    Feb. 14, 1914.
    Rehearing Denied March 14, 1914.)
    1. Bills and Notes (§ 245) — Rights of Indorser Against Maker — “Principal”— “Surety.”
    S. was surety on a note upon which judgment was recovered. He and the principal debtor executed a new note for borrowed money with which to pay the judgment under an agreement that the principal debtor would procure K.’s signature as a cosurety and give K. security for its payment. This agreement was not known to K. and no security was given him. The note when presented to K. by the principal debtor was signed by the debtor and S., and K. refused to sign it but agreed to and did indorse it on the back, stating that he would become responsible only as indorser. Held, that as between themselves K. was a surety for S. and entitled to judgment over against him for the amount of the judgment recovered by the payee against K., since, whatever their apparent relation to the paper, the one who receives the benefit of the execution of the note is the principal, and the one who receives no benefit, but simply signs it as an accommodation for the other, is the surety.
    [Ed. Note. — For other cases, see Bills and Notes, Cent. Dig. §§ 558, 559; Dee. Dig. § 245.]
    2. Evidence (§ 423) — Parol Evidence — Bills and Notes — Relation op Parties.
    Whatever the apparent relation of parties to a note, their true relation as between themselves may be shown by parol evidence.
    [Ed. Note. — For other cases, see Evidence, Cent. Dig. §§ 1957-1965; Dec. Dig. § 423.]
    Appeal from Taylor County Court; T. A. Bledsoe, Judge.
    Action by W. N. Mott against J. N. Shepherd and others. Judgment for plaintiff and for the defendant E. N. Kirby against the defendant Shepherd, and Shepherd appeals.
    Affirmed.
    J. M. Wagstaff, of Abilene, for appellant. Scarborough & Hickman, of Abilene, for appellee.
    
      
      For other cases see same topic and section NUMBER in Dec. Dig. & Am. Dig. Key-No. Series & Rep’r Indexes
    
   SPEER, J.

W. N. Mott recovered judgment against J. N. Shepherd and E. N. Kirby, and E. N. Kirby recovered judgment over against J. N. Shepherd; the controversy arising over the liability of the respective parties on a promissory note signed by A. G. Britton and J. N. Shepherd and indorsed by E. N. Kirby. There is no complaint of the judgment in favor of Mott, but Shepherd appeals as. against the judgment in favor of Kirby.

The trial court, before whom the case was tried, made the following findings of fact, which we adopt: “(1) A. B. Britton, the principal on the note sued on, is insolvent and was not a necessary party to the suit (2) The note sued on was dated'July 20, 1911, and was signed by A. G. Britton and J. N. Shepherd, and was payable to the plaintiff, W. N. Mott, and was due six months after date, was for the sum of $390, and bore interest from maturity at the rate of 10 per cent, per annum, provided for 10 per cent, attorneys’ fees in case of suit and was payable to W. N. Mott, at Abilene, Tex. ' (3) That said note was duly signed by A. G. Britton and J. N. Shepherd; the name of Shepherd appearing directly under the name of Britton. (4) On the back of said note appeared the following indorsement: ‘Demand, notice and protest waived, E. N. Kirby.’ And that said indorsement was made by the defendant E. N. Kirby before the delivery of said note to the plaintiff, W. N. Mott. (5) I find that A. G. Britton was instrumental, wholly, in procuring the loan of money from W. N. Mott, on said note, and that the defendant J. N. Shepherd had nothing to do with the negotiations for the same with W. N. Mott. (6) I find that the money procured from said Mott on said note was used principally to pay off a judgment in favor of the Farmers’ & Merchants’ National Bank of Abilene, Tex., against one W. T. Bolt, A. G. Britton, and the defendant J. N. Shepherd, and that said Bolt was the principal in the note on which said judgment was obtained. That A. G. Britton and J. N. Shepherd were equally bound in said judgment, and same was a ‘default’ judgment as to Shepherd. (7) I find that, as between A. G. Britton and the defendant J. N. Shepherd, the said Shepherd was to become surety on the note sued on, to said Mott, and that the said Shepherd also required the said Britton to procure the signature of the defendant E. N. Kirby, on said note, as a cosurety, and that the said Britton agreed with said Shepherd that he would give security for the payment of said note, said security to be given to E. N. Kirby, but such agreement and understanding between said Britton and said Shepherd was unknown to the defendant E. N. Kirby and no security was given him by said Britton. (8) The total amount of the note at the time of the trial including interest and attorneys’ fees was $448, and it was agreed in open court by all parties that W. N. Mott should have judgment against the said Shepherd and Kirby jointly and severally- for the amount due thereon, but it was controverted as to whether the said Kirby had the right to recover judgment over against the said Shepherd. (9) I find that A. G. Britton applied to the defendant E. N. Kirby to sign the note herein sued on with him and the defendant J. N. Shepherd, and that said Kirby refused to do so. That the plaintiff, W. N. Mott, came also with A. G. Britton to see the defendant E. N. Kirby about signing said note with said Britton and Shepherd, and that said Kirby refused to sign the same, but agreed to indorse said note provided the same was signed by said Britton and the defendant Shepherd and stated to said Mott and said Britton that he would not become responsible on said note except as ‘indorser,’ and that he indorsed same with- that understanding, after it had been signed by said Britton and Shepherd. (10) I find that said note was brought to the office of the defendant E. N. Kirby by the plaintiff and A. G. Britton, duly signed by the defendant J. N. Shepherd and A. G. Britton, and that he then indorsed it as above stated.' (11) I find that nothing was ever said to said Shepherd by said Kirby and nothing to said Kirby by said Shepherd in reference to said note, either before or at the time of signing the same.”

We affirm the trial court’s conclusion of law that, as between themselves, defendant in error Kirby was a surety for plaintiff in error Shepherd, and as such entitled to judgment over against him. It seems to be well settled that as between the parties, whatever their apparent relation to the paper upon which they are sought to be held liable, their true relation to themselves may be shown by parol evidence, and that the one who receives the benefit of the execution of the note is the principal, and the one who does not receive any benefit, but simply signs it as an accommodation for the other, is the surety. Stuart v. Altman, 8 Tex. Civ. App. 657, 28 S. W. 461; Dessar v. King, 110 Ind. 69, 10 N. E. 621.

The findings above quoted bring this case well within the rule announced, and the judgment is affirmed.

Affirmed.