Case Name: FIRST NATIONAL BANK v. N. CECIL
Court: Oregon Supreme Court
Jurisdiction: Oregon
Decision Date: 1892-10-05
Citations: 23 Or. 58
Docket Number: 
Parties: FIRST NATIONAL BANK v. N. CECIL.
Judges: 
Reporter: Oregon Reports
Volume: 23
Pages: 58–63

Head Matter:
[Decided October 5, 1892.]
FIRST NATIONAL BANK v. N. CECIL.
[S. C. 31 Pac. Rep. 61.]
1. Promissory Note — Consideration—Forbearing Suit. — Mere forbearance to sue upon receiving the note of a third party, or his signature to a note already made and delivered, is not a good consideration and will not support the promise of the surety so made. In addition to the forbearance there must have been a promise so to do in order to sustain the contract. When the agreement to forbear is not explicit, it may be inferred from the fact of the forbearance, and this implied agreement is a sufficient consideration for the new note or signature.
2. Promissory Note — Signing After Delivery — Principal and Surety —Maker.— When one, for a valuable consideration, signs his name to a joint and several promissory note after it has been signed and delivered, he becomes, as between himself and the payee, a maker and may be sued as such. He entered into a new contract with the holder of the note on a new and additional consideration.
Gilliam County: W. L. Bradshaw, Judge.
Defendant appeals.
Affirmed.
Alfred S. Bennett, for Appellant.
Franlclin P. Mays, for Respondent.

Opinion:
Bean, J.
This is an action to recover tbe sum of three thousand ninety-two 'dollars and seventy cents, and interest from November 20, 1890, upon a promissory note for that amount dated December 20, 1889, and executed by defendant on September 12, 1890. A trial before a jury resulted in plaintiff's favor, from which defendant brings this appeal.
On the trial plaintiff gave evidence tending to show that on December 20, 1889, F. Cecil, T. A. Rausier, and Sumner Reed, for a valuable consideration, made, executed, and delivered to plaintiff their joint and several promissory note for three thousand ninety two dollars and seventy cents, due ninety days after date, with interest at the rate of ten per cent per annum from date until paid. After this note became due, and while it was unpaid, F. Cecil, in order to escape the payment thereof if possible, and tó compel the bank to collect the note from his co-maker, Sumner Reed, assigned, transferred, and conveyed all his property to his brother, the defendant in this action. Upon learning of this transfer, a representative of the plaintiff Bank sought an interview with defendant and notified him that inasmuch as he had the property of F. Cecil, the bank wanted him to sign the note it held against Cecil, Rausier, and Reed, at the same time informing him that unless he did sign the note it would institute proceedings to contest the conveyance from his brother to himself, as it knew there was no consideration for the conveyance, but it was made solely for the purpose of getting the property out of F. Cecil's hands. Whereupon the defendant agreed to and did, on September 12, 1890, sign his name to the note at the bottom thereof, and plaintiff refrained from bringing suit to set the conveyance aside. At the close of plaintiff's testimony, defendant moved for a nonsuit, which being overruled, the cause was submitted to the jury without any evidence whatever on the part of defendant.
The contention of defendant on this appeal is that his signature to this note was void and of no effect — first, because there was no consideration for the same, and, second, because by placing his name on the note under the circumstances detailed, he became only a surety or guarantor for the other parties to the note, and his contract was a collateral one within the statute of frauds, and void because it does not express the consideration.
1. Upon the first point the argument is, that the arrangement between plaintiff and defendant did not amount to an agreement on plaintiff's part to forbear proceedings to contest the conveyance from F. Cecil to defendant. This question coming before us as it does on a motion for a nonsuit, we are only called upon to say whether the jury could fairly infer such an agreement from the evidence reported. By the evidence it does not appear that plaintiff in so many words agreed to forbear proceedings to contest the conveyance, but it seems to us the evident import of the language and conduct of both parties is to that effect, or at least the jury was justified in so finding. Plaintiff said: "Unless you sign the note we will contest the conveyance," which fairly implies that if the note is signed, plaintiff will forbear such proceedings, and this was clearly the understanding of both parties, and is evidence from which the jury could find an implied agreement to forbear. "Whether there was an implied agreement to forbear," says Chief Justice Shaw, in Boyd v. Frieze, 5 Gray, 555, "is a question of fact, depending on the circumstances, and if they are such as lead to a natural and reasonable conclusion that the new security or other new promise was given to induce the creditor to forbear, and he did in fact forbear, a jury may find that there was such implied agreement or understanding, upon which the court would hold that there was a good and legal consideration to give effect to the new promise: Walker v. Sherman, 11 Met. 172; Breed v. Hillhouse, 7 Conn. 523."
2. When a promise is direct and when collateral is often a vexed and difficult question, but we do not think it necessary to enter into any discussion of that question in this case, for we take the rule to be that when one after its delivery signs his name to a joint and several promissory note for a valuable consideration, he becomes, as be tween bimself and the payee, a maker and may be sued as such: 1 Edw. Bill. § 257; Partridge v. Colby, 19 Barb. 248; McVean v. Scott, 46 Barb. 379; Card v. Miller, 1 Hun, 504; Brownell v. Winnie, 29 N. Y. 400 (86 Am. Dec. 314); Dickerman v. Miner, 43 Iowa, 508; Hamilton v. Hooper, 46 Iowa, 515 (26 Am. Rep. 161). Independently of the question of the alteration of the note and the effect of the defendant's signature upon the liability of the other parties, the legal effect of his signing the note under the circumstances of this case is, that he became a party to a new contract as between him and the plaintiff on a new and additional consideration. The effect of his act was to execute a new note at the time he attached his signature, and as the maker of such note he is liable.
[Decided February 13, 1893.]
We find no error in the giving or refusal by the court of instructions on the question of the attorney's fees, and the judgment is affirmed.