Case Name: Crump v. J. I. Case Threshing Machine Co.
Court: Kentucky Court of Appeals
Jurisdiction: Kentucky
Decision Date: 1909-12-08
Citations: 136 Ky. 60
Docket Number: 
Parties: Crump v. J. I. Case Threshing Machine Co.
Judges: 
Reporter: Kentucky Reports
Volume: 136
Pages: 60–65

Head Matter:
CASE 8 — ACTION BY J. I. CASE THRESHING MACHINE CO. AGAINST M. H. CRUMP AND OTHERS. —
December 8, 1909.
Crump v. J. I. Case Threshing Machine Co.
Appeal from Warren Circuit Court.
John M. Galloway, Circuit Judge.
Prom the judgment the defendant, M. H. Crump, appeals. —
Affirmed.
1. Guaranty-Actions — Defenses—Want of Consideration— Joint Guarantors. — In an action on a promissory note against the maker and two who joined as guarantors, want of consideration as to one of the guarantors did not affect the liability of the 01 her guarantor.
2. Bilis and Notes — Consideration—As to Gurantor — Effect as to Maker. — That there was no. consideration for a note as far as a grantor was concerned did not affect the liability of the maker.
3. Judgment — Parties—Against One of Several Defendants — Default of Co-Defendants. — Civ. Code Prac. Sec. 366, authorizes a judgment in equitable actions at the first term after service on all defendants, as provided in section 102. Section 3(3 provides that if several defendants are summoned, judgment may be rendered against any of them, if plaintiff would he entitled to judgment against them alone. Section 27 permita an action on s joint contract against all or any of the persons bound thereby at plaintiff’s option, and provides that a judgment against one or more shall not har proceedings against the others. Section 370 permits the court in its discretion, in"an aciion against several defendants, to render judgment against one or more of them, leaving the action to proceed against the others if a several judgment is proper. Plaintiff sued the maker and two joint guarantors on a promisory note. The maker and the only guarantor summoned made default, but the ruber guarantor filed an answer. Held, that judgment was propeily entered against the guarantor summoned, and the action continued as to the one not summoned, so- as to try the issues raised by him.
i. Guaranty — Operation of Contract — Default of Principal. — The guaranty indorsed on the back of the last due of three notes, secured by a chattel mortgage, recited that the guarantor guaranteed payment of the note, waived all rights to any mortgage security held for its payment until the mortgage indebtedness was satisfied, and the chattel mortgage securing the notes provided that, if the maker failed to pay either of the first two notes due, the third note should immediately-become due at the mortgagee’s option. Pleld, that the third note became due, and the guarantor became liable thereon, at the holder’s option, when the maker failed to pay the two notes first due, though the third note was, on its face payable thereafter.
W. B. GAJNES for appellant.
WRIGHT & McELROY for appellee.

Opinion:
Opinion op the Court by
Judge Barker
— Affirming.
The appellee, J. I. Case Threshing Machine Company, sold to W. T. Payne a threshing machine, for a part of the purchase price of which Payne executed and delivered to it his three promissory notes, by the first of which he agreed and promised to pay $200 on the 1st day of September, 1907, with 6 per cent, interest per annum from date until paid. By the second he agreed to pay $200 on the 1st day of January, 1908, with 6 per cent, interest per annum from date until paid. By the third he agreed and promised to pay $250 on or before June 1, 1908, with 6 per cent, per annum, from date until paid. To secure the payment of these notes Payne executed and delivered to •the threshing machine company a chattel mortage upon the machine sold him, and as additional security the appellant, M. H. Crump, by writing on the hack thereof, guaranteed the payment of all three'of the notes. In the guaranty of the payment of the first note D. S. Greer joined as guarantor. In the chattel mortgage executed by-Payne to secure the notes herein mentioned there was a clause providing that, if any of them were not paid at maturity, the whole debt should, at once become due and payable. The maker having failed to pay the first two notes, the appellee elected to consider the whole of its debt due, and brought suit against the maker and the guarantors of the three notes, and also to enforce its lien on the threshing machine, upon which it had a mortgage, as before stated. Neither Payne nor Crump made any defense to the action instituted against them, although properly brought before the court by summons. Greer filed an answer pleading no consideration for his guaranty, and making his answer a cross-petition over against Payne and Crump. This part of the procedure we need not notice further, as it is not now before us, except to say that Greer's answer presented a defense to appellee's action which was applicable to him- alone, and, if true, .in no wise tended to release either Payne or Crump. On the 13th day of June, 1908, the case coining on for trial, the court rendered a judgment against Payne and Crump .for $650, being the aggregate of all the notes sued on, with interest at the rate of 6 per cenk per annum from December 6, 1806, until paid. It also rendered a judgment enforcing appellee's lien upon the threshing machine, and ordered it sold. As to the defendant, Greer, the case was continued for the trial of the issues raised between him and appellee, and between him and his codefendants, W. T. Payne and M. II. Crump, on the cross-petition.
Appellant, Crump complains on this appeal that' the judgment against him was erroneous because his codefendant, ,D. S. Greer, had not been summoned. But we are unable to agree to the soundness of this objection, as Greer filed his answer, thus entering his appearance and making it immaterial whether or not he had theretofore been summoned. It is true that section 366 of the Civil Code of Practice only authorized a judgment in an equitable action at the first term after the summons has been served on all the defendants, as provided in section 102; but, Greer having filed his answer, thereby entering his appear.ance, he stands just as if he had been properly served with summons, so all the requirements of section 366 were complied with. Section 373 provides: "Though several defendants are summoned, judgment may be rendered against any of them, if the plaintiff would have been entitled to judgments against them in an action against them alone." Section 27 provides: "If two or more persons be jointly bound by contract, the action thereon may be brought against all or any of them, at the plaintiff's option. Any action or judgment against any one or more of several persons jointly bound shall not be a bar to proceedings against the others." Plaintiff (appellee) < could have sued either Greer or Crump alone on the -contract of guaranty, and, therefore, under the provisions of section 373 of the Civil Code of Practice, plaintiff was entitled to a judgment against any of them. Section 370 provides: "In an action against several defendants, the court may, in its discretion, render judgment against one or more of them, leaving the action to proceed against the others, if a sev- • eral judgment be proper." The court correctly entered judgment against Crump, and- continued the action for further proceedings as to Greer, so far as the objection that Greer was not before the court' was concerned.
Appellant also contends that it was erroneous to give a judgment against him on the third note, because at the time of the institution of the action that note was not yet due. It is true that by the contract on the face of the note it was not due on the 6th day of May, 1908, when this action was instituted, and did not fall due until the 1st day of June, 1908; but upon the face of it it appeared to be one of the notes secured by chattel mortgage, and this chattel mortgage, as said before, contained a precipitation clause, by which it was provided that if any of the notes were unpaid after they fell due, the whole debt was to mature at the option of appellee. It is the contention of appellant that this guaranty was only to pay the note when due according to its face, and that it was not a part of the chattel mortgage, but an independent contract, and, therefore, he was not bound by the precipitation clause. The guaranty was indorsed upon the back of the note, and is as follows: "For value received I guarantee payment of the within note and waive presentment, demand, protest and notice of nonpayment and all defenses of want of diligence in collection and bringing suit and consent to any change of sécurities, and that said note may be renewed or extended from time to time, at an increased rate of interest, without notice to me, and hereby waive all rights to any mortgage security held for the payment of said'note until all the indebtedness'secured by such mortgage is fully paid." It seems to us that this guaranty comprehends the payment of the note at the time it was due by Payne's contract. Now it is true that if the other notes had been paid as they fell due, the third note would not have become due until June 1, 1908, and, as the suit was brought on the 6th day of May, 1908, it would have been prematurely instituted so far as tbe note was concerned; but by tbe terms of tbe chattel mortgage Payne agreed that if be failed to pay tbe first two notes, or either of them., tbe third note would at once become due under tbe precipitation clause. Tbe guarantor, Crump, bad notice that tbe notes were secured by chattel' mortgage, and, as this was recorded be at least bad constructive notice of its contents. But be this as it may, as said before, tbe guaranty was to pay tbe note under consideration if tbe maker, Payne, failed so to do. Whenever Payne, tbe maker, made default in bis contract,, then the guaranty became operative. Tbe default of Payne took place when be failed to pay tbe note according to bis contract and under bis contract tbe note under consideration became due at tbe option of tbe appellee when Payne failed to pay either of tbe other notes.
Tbe judgment is affirmed.