Case ID: mo_1/html/0048-01.html
Source: Caselaw Access Project
Author: {"author": "Jones, J.,", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Hunter v. Hempstead.
    1. The maker of a promissory note, and an endorser thereof, can be sued at the same time, and the endorser is liable on non-payment.
    2. If a note is presented to one partner of a firm for payment, it is good.
    
      3. A holder of a promissory note may fill up blank endorsements, or strike them out. 
    
    APPEAL from the Circuit Court of St. Louis county.
    
      
      a.) See Riggin v. Collier & Pettus, 6 Mo. R. p. 572.
    
   M’Girk, C. J.,

delivered the opinion of the Court.

This was an action on the case by an endorsee of two promissory notes, against the payee and first endorser. The declaration states that James Thompson and John P. Finley, as partners, by Finley, made their notes to Hempstead, that he endorsed them to John W. Thompson, who endorsed them to the plaintiff.

The declaration is in the common form, stating that Hempstead endorsed to J. W. Thompson, and that he endorsed Co Hunter, the plaintiff. First plea, non-assumpsit. Second plea, that the de*' udant did not make the endorsement to J. W. Thompson, as stated in the declaration. Third plea alledges the plaintiff had commenced his action against the makers of the notes, and that one of them was arrested and appeared to the action. To the first and second pleas, issue is taken to the country, and to the third there is general demurrer. The two issues of fact were found by the Court for the plaiutUF, and the demurrer to the third plea sustained. It is ihe opinion of this Court, the issues of fact were rightly found, as for any thing appearing of record to this Court: and agreeably to the decision of this Court, at this term, Hunter v. Price, the demurrer was rigidly sustained; there the question was, what is sufficient diligence on the part of the holder of an endorsed promissory note to entitle him (o maintain his action against the endorser? And it was decided, on solemn argument, by (be whole Court, that a demand on the maker, when the note becomes due, and his failure to pay, are sufficient to maintain the action. This case is exactly like that, and must be governed hy it. Now here the question is solemnly made, can the makers of a note and the endorser be sued at the same time, in several actions? (see Chitty on Bills, American edition, 361;) and the question is also made, that here there is no privily between Hunter and Hempstead, and that, to entitle blunter to sue Hempstead, J. W. Thompson’s name should have been stricken from (he nolo; Chitty on Bills, 370, (American edition,) is expressly to the contrary. Another error complained of in disposing of the first issue is, that by the bill of exceptions in this case, it appears no demand of payment of said notes was made of Finley, but only of Thompson, one of the partners.

It cannot be perceived how it is necessary to make a demand of all the partners composing a company; one partner may make a note in the course of business, and bind the company, ( Watson on Part. 195, Chitty on Bills, 40, 41;) he may accept a bill drawn on them, and they are hound by it; he may make payment of a note, or bill made, or accepted by the company, (see as above, Watson and Chitty,) and how it can be, that the refusal of one partner to pay, is not a refusal of the company as to the holder, this Court cannot discover. There is, therefore, no error on this point.

1 The hill of exceptions shows that at the time the notes were made, the defendant endorsed them in blank, and then J. W. Thompson also endorsed in blank, and they were then delivered to the plaintiff, and the witness knew of no other object in making the endorsements but to secure payment. It was insisted by the defendant, on the trial of the cause in the Circuit Court, that, as it respected the second issue, this testimony and these facts were ineffectual in law to authorise the plaintiff to fill the endorsement a3 he had, and so the defendant insisted the second issue ought to have been, by the Court, found for him.

It often happens in the course of business, notes are endorsed by several at the same time, for no other purpose than to make the payment secure; but let this be as it may, the legal properties of the instrument, and the legal effect of the endorsements, am not altered. The holder may fill the blank endorsements to himself, or strike some out if he chooses to do so, (Chit, on Bills, Amer. ed., 370, 371.) The endorser in this case has treated the instrument as he was warranted by law to do. There is no error on this point.

Let the judgment, therefore, be affirmed with C03ts.

Jones, J.,

dissenting.

This was an action brought by Hunter v. Hempstead, as endorser of two notes of hand, drawn by James Thompson and John P. Finley, as co-partners, in his favor, which he endorsed to John W. Thompson, who endorsed to the plaintiff, Hunter. To which the da'erdant pleaded, first, the general issue; second, that he had never endorsed to J. W. Thompson; and third, that the plaintiff had commenced an action on the same notes, against the makers, which was then pending; one of them having been arrested and appeared thereto.

Issue was joined on the two first plea3, and a general demurrer was filed to the third. The demurrer being sustained, the issues were submitted to the Court without the intervention of a jury.

During the trial, several exceptions were filed to the opinion of the Judge. The first, because the Court had decided it was not necessary for the plaintiff to have exhausted his remedy against the drawers, before he could have recourse against the endorsers. This decision was correct, as has been so determined at this term, in the case of Hunter v. Price, and in some other case3. The next exception was, that the Court decided it not necessary to prove demand of payment from each of the drawers, but that a demand on one of them was sufficient. The Court’s decision on this point was, in my opinion, correct. Was the law otherwise, it would be impossible, in many instances, to recover payment of n'ote3 d:awn by a firm, consisting of several individuals, some one or more of them often residing abroad, for the purpose of carrying on their affairs more extensively and profitably; and were they even to live at the same place, it would he difficult to find them all together. The next exception to the opinion of the Court, is on account of the admission of the following testimony, as conclusive against the defendant, and permitting the plaintiff to make the several assignments he had done on the blanks left oyer the names of the defendant and J. W. Thompson.

The evidence was, that at the time the notes were drawn, the defendant endorsed them, and after him the said J. W. Thompson, when they were delivered to the plaintiff; that the witness knew of no object of the endorsements except to secure the payment to the makers. To which the defendant excepted, insisting that the legal effect thereof was not an endorsement by defendant to John W. Thompson, as so explained, and that the plaintiff had no legal power to write the assignments over the respective names of defendant and J. W. Thompson, which were endorsed in blank on said notes.

Judgment was given for the plaintiff, from which the defendant appealed. The question to be determined is, whether the plaintiff, as endorsee, can sustain his action against the defendant, his remote endorser?

A law of the territory, passed in 1807, (Geyer’s Dig. 66,) authorises the assignment of bonds, bills and notes, and permits an assignee to bring suit in his own name, in the same manner as the assignor could do. But this authority is extended no further than to the immediate assignee, and admitting that this permission could be construed to subsequent assignees, it does not provide for any remedy for the endorsee against any endorser ; as it does not, we must inquire if there are any, and what remedies are pointed out by the common law. Some contend that no action can be maintained by an endorsee against an endorser, in any case; I am of a different opinion, and think that an endorsee can, by the common law, maintain an action against his immediate endorser and the drawers of a promissory note, but not against any remote endorser ; there being no privity between them in law, and that, for want of such privity, the action below could not have been legally sustained, 1 Cranch 290, 298; 3 Cranch 311, Harris v. Johnson; 5 Cranch 146, Violet v. Patten, and 5 Cranch 322, Manderville & Jameson v. Riddle & Co. In the last case, Chief Justice Marshall, in delivering the opinion of the Supreme Court of the United States, says — that the action against the endorser is not given by the statute, (similar nearly to ours.) The endorser is understood to pass tp the endorsee, every right he possessed to the note; among these is his right against prior endorsers. This right is founded on an implied contract, which is not, by law, assignable; but it vests an equitable interest in the holder, capable of being transferred — and the plaintiffs accordingly had a decree in their, favor. It may be inferred that the Legislature of the Territory did not intend to give endorsers authority to sue remote endorsers ; if such was their intention, it would have been expressed in the law of 1817, (Geyer’s Dig. 96,) which authorises the holder of foreign bills of exchange to sustain actions against the drawers and endorsers, jointly and severally, or against either of them separately. I am of opinion that the action below was not sustainable, either by the common or statute law in force in the late Territory; and that, therefore, the judgment ought to be reversed with costs.