Case Name: P. Pierce vs. Cameron, McDermid & Mustard
Court: South Carolina Court of Appeals
Jurisdiction: South Carolina
Decision Date: 1854-01
Citations: 7 Rich. 114
Docket Number: 
Parties: P. Pierce vs. Cameron, McDermid & Mustard.
Judges: O’Neall, Wardlaw, Withers, Whitner and Glover, JJ., concurred.
Reporter: South Carolina Law Reports
Volume: 41
Pages: 114–117

Head Matter:
P. Pierce vs. Cameron, McDermid & Mustard.
Defendants, in order to raise money to pay for a negro they had bargained for, drew a promissory note payable to the plaintiff, upon which he advanced the money. The negro proved to be unsound : — Held, that defendants could not show the unsoundness as a defence to the action on the note — the consideration of which was not the price of the negro, but the money advanced.
A promissory note drawn by a firm is not merged in a bond and mortgage given, at the same time and for the same debt, by one of the partners, in the name of the firm, but without the assent or knowledge of his copartners.
A bond oxecuted by one partner in the name of the firm, without the assent or knowledge of his copartners, is the bond of the individual partner who executed it.
Before Q’Neall, J., at Charleston, Spring Term, 1853.
The report of his Honor, the presiding Judge, is as follows:
“ This was an action on a note of hand for $625, due 60 days after date, payable to the plaintiff, or order, dated 24th September, 1846. It was proved to be the note of the defendants.
“ It was given for a slave named Henderson, sold by Wm. Ellis, for George W. Jones, and by him warranted tobe sound.
“ Ellis stated the transaction, that Jones, through him, offered the negro for sale, for cash ; that the defendants wished to buy, but had not the money; he, (Ellis,) knowing that he could get the money from Pierce, sold them the negro, and took their note at sixty days; the plaintiff gave him the money for it. tie said the plaintiff knew nothing of the trade between him and the defendants.
“ Cameron, in the name of Cameron, McDermid & Mustard, also executed a bond for the price of the slave, and a mortgage of him to secure the payment.
“ The slave turned out to be unsound; he was sold by consent, and the proceeds paid to the plaintiff — a sum of $440.45 was thus obtained, and applied to the payment of the note in part. The balance, $ 184.55, was that which was claimed.
“ The jury were instructed, first, that there was no merger of the note in the bond ; inasmuch as the bond could not be re garded as any other than the bond of Cameron alone, and not of the firm — for there was no sort of proof that the other members of the firm had at all assented to it.
“2d. That the consideration of the note as between Pierce and the defendants, could not be inquired into, unless he knew that it was given for the slave ; for he paid his money for a negotiable note not due. As to him, the consideration was the money advanced. The jury were not prevented, by any thing said to them, from finding that the plaintiff knew that the note was given for the slave, if there had been any such proof in the case. But the contrary was the evidence.
“ The jury found for the plaintiff.”
The defendants appealed, and now moved this Court for a new trial, on the grounds:
1. Because his Honor ruled that, without evidence of knowledge on the part of the payee, of the consideration of the note, the consideration could not be enquired into : whereas, it is respectfully submitted that as between the parties to this note, the consideration could be examined, without any evidence to affect the payee with knowledge.
2. Because his Honor charged that there was no evidence affecting the payee of the note with knowledge of its consideration, and that the jury must find for the plaintiff: whereas, it is submitted, that there was ample evidence of his knowledge of the consideration, and that the point should have been submitted to the jury to judge of the sufficiency of the evidence.
3. Because full notice of the whole transaction was proved as to W. D. Ellis, who acted as the agent of Pierce and Jones in the transaction, and it is submitted that notice to the agent was notice to the principal.
4. Because the bond (produced by the plaintiff at trial) given to Pierce with the note, and forming a part of the transaction, was secured by a mortgage of the negro Henderson, (which mortgage was also produced at trial,) and the receipt of Pierce’s agent for these documents, fully proved his knowledge of the transaction, the receipt being in these words: “ Bec’d, Sept. 25th, of Cameron, McD. & Mustard, their note, bond and morh gage, for six hundred and twenty-five dollars, in favor of P. Pierce, in payment for a fellow Henderson.”
5. Because the note upon which suit was brought must be held to have merged in the higher security given for the same transaction, viz: the bond and mortgage; or, at all events, the plaintiff having elected to proceed upon the bond and mortgage, must be held to have waived the note, and should have sued upon the bond.
6. Because, it is submitted, that his Honor erred in ruling that the bond produced at the trial was not the bond of Cameron, McDermid & Mustard ; because it was proved that Cameron signed on the part of his firm, and the plaintiff recognizing it as their bond by his agent’s receipt, he is prevented from denying that it was their bond — and the defendants, by consenting to the proceedings under the mortgage for the sale of Henderson, ratified the act on the behalf of the partnership, and both then and at the time of trial admitted it as their bond.
Torre, for appellants.
F. D. Richardson, contra.

Opinion:
The opinion of the Court was delivered by
Mtjnro, J.
From the report of this case, it is apparent, that the defendants have little cause to'complain, either of the charge of the Circuit Judge, or the finding of the jury; for the testimony was conclusive, that the only consideration that passed between the plaintiff and the defendants, was money advanced by the former to the latter, upon the faith of the note which is the subject matter of the present action. It is true, that the defendants' object in procuring, through their agent Ellis, the loan in question, was to enable them to pay for a slave they had purchased from one Jones, which slave afterwards proved to be unsound. But how a knowledge of these facts by the plaintiff — even if they had been brought home to him — could affect his right to recover back his money, it is somewhat difficult to perceive; for it is obvious, that he had neither the right to inquire the use the defendants intended to make of the fund they had borrowed, nor the power to control its application; and if the defendants thought proper to invest it in an unsound slave, without using the precaution to guard against imposition, they surely have no right to visit the fruits of their folly or misfortune upon the plaintiff. So that, unless the defendants had established, that plaintiff had participated with Jones in the fraud which the latter had practised upon them, any evidence short of that would have been wholly irrelevant to the issue. But the testimony of the witness Ellis entirely absolves the plaintiff from all participation in the transaction; for he expressly declares that the plaintiff had no knowledge whatever of the trade between him and the defendant.
The only remaining question, is that presented by the 5th ground of appeal — the merger of the note in a bond and mortgage, executed at the same time, and for the same debt. It, however, appears from the testimony, that the bond referred to was not executed by the individual members composing the firm of Cameron, McDermid <fc Mustard, but was executed by Cameron alone, in the name of the firm, without the assent or knowledge of his copartners.
Had the bond been executed in a manner that would have secured to the plaintiff the individual responsibility of the several members composing the firm, there can be no question, but the lesser would have become merged in the higher security; but unless it can be affirmed, as a legal proposition, that a promissory note, executed in the name of a copartnership, becomes merged in a bond executed by one of its members, it would be — to say the least of it — a strained application of the doctrine of merger to apply it to such a transaction as this.
The motion is dismissed.
O'Neall, Wardlaw, Withers, Whitner and Glover, JJ., concurred.
Motion dismissed.