Case Name: Edwin B. Fiske, App'lt, v. Demian D. Williams, Resp't
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1896-04
Citations: 74 N.Y. St. Rep. 582
Docket Number: 
Parties: Edwin B. Fiske, App'lt, v. Demian D. Williams, Resp't.
Judges: 
Reporter: New York State Reporter
Volume: 74
Pages: 582–585

Head Matter:
Edwin B. Fiske, App'lt, v. Demian D. Williams, Resp't.
(Supreme Court, Appellate Division, Fourth Department,
Filed April, 1896.)
1. Contract—Construction.
Where two constructions to an instrument are possible, one of which does not give significance to all the words used, and another can he given which will give force and effect to all the words found in the instrument, the latter construction is to he preferred and adopted, and in case the meaning of the words is doubtful, it is to be construed the most strictly against the covenantor whose words they are.
2. Same.
A transfer of stock, at the same time with the indorsement of note and with intent to secure its payment, is a pledge of such stock for the indorsement whenever liability as indorser should become fixed, and not for payment of note unconditionally.
Appeal from a judgment, dismissing the complaint on the merits, after a trial without a jury.
Robson & Robinson, for app’lt; P. M. French, for resp’t.

Opinion:
HARDIN, P. J.
When Fiske indorsed the note, and delivered it to the defendant, he placed his name upon the note, which was to run some months to maturity. There was a twofold purpose accomplished by his indorsement: First, it was necessary that his name should be placed upon the note in order to transfer the legal title to the note; second, he, by placing his name upon the note, made a commercial contract, which made him additionally liable for the debt of the maker in the event the note was presented for payment at its maturity, demand and notice of protest given. At the same time that he indorsed the note, there were accompanying it 100 shares of the Scugog Medicine Company stock, that were pledged as collateral to the maker's obligation to pay the nqte. Apparently, the defendant, who was to advance the money for the note, was not satisfied with the obligation of Madden, the maker, nor with the Scugog Medicine stock, Imd required further security as a condition of parting with his money for the note. Thereupon, apparently, the plaintiff delivered to the defendant 15 shares of the Standard Electric Signal Company stock; and, in connection with the delivery of the note and the Scugog Medicine Company stock, he delivered the 15 shares of the Standard Electric Signal Company stock, and, simultaneously with the delivery therewith, executed an agreement which is set out in the findings of fact made by the trial judge. Upon an inspection of that agreement, it is found to recite that Fislce, the plaintiff, was to or had indorsed the note in question, and there is a recital in the agreement to the effect that the stock was delivered by the plaintiff, to wit, the 15 shares of the Standard Electric Signal Company, as collateral to the indorsement. If the language of the instrument closed there, then there might be force in the contention of the plaintiff. But there was further language used, to wit:
"And it is expressly undei'stood and agreed that the holder and owner of said note, if the same is not paid on or before maturity, is first to exhaust his remedy against R. M. Madden, the maker; and, if the security given by him is not sufficient to pay and discharge said note, then the certificate of stock hereto annexed is for the payment of such deficiency, whatever it may be."
It is a well-settled canon for the construction of instruments executed by parties that full force and significance should be given to all the language used by them, and that if two constructions are possible to an instrument, one of which does not give significance to all the words used, and another can be given to the instrument which will give force and effect to all the words found in the instrument, the latter construction is to be preferred and adopted; and, in case the meaning of the words is doubtful, it is to be construed the most strictly against the covenantor whose words they are. Applying these rules of construction to the instrument executed by the plaintiff, it seems reasonable to place "upon it the construction which evinces an intention to pledge his stock as security for any deficiency that might arise after exhausting the remedies against Madden, the maker of the note; and. after conversion, and application of the proceeds of the sale of the Scugog Medicine Company stock, and for the purpose of satisfying the deficiency which arose after exhausting the prior sources, the stock of the Standard Electric Signal Company was a security in the hands of the defendant, and he was'entitled to it for the purpose of satisfying "the deficiency" remaining after the exhaustion of the liability of Madden and the sale of the Scugog Medicine Company stock. Hence, at the time this action was commenced, the defendant had not wrongfully converted the property of the plaintiff, known as the 15 shares of the Standard Electric Signal Company described in the complaint; and it was therefore proper, at the close of the trial, to order judgment in favor of the defendant. The judgment should be affirmed.
Judgment affirmed, with costs.
FOLLETT, ADAMS and WARD, JJ., concur.