Case Name: Yancey v. Littlejohn
Court: Supreme Court of North Carolina
Jurisdiction: North Carolina
Decision Date: 1823-12
Citations: 2 Hawks 525
Docket Number: 
Parties: Yancey v. Littlejohn,
Judges: 
Reporter: North Carolina Reports
Volume: 9
Pages: 525–532

Head Matter:
Yancey v. Littlejohn,
From Granville.
A (Ic'IO'ukI of the maker of a Hole, and notice of non-payment gwen ’i ■; ■ tlic c.idoMor within reasonable time, is neecssary to charge, the endorser ; wuai is reasonable time, must depend on circumstances; four months 'when the parties all resided in the same village, is un-rcasonable.
When the holder of a note procured a confession of judgment from the ■maker, and granted him a cessat es'ecutlo during six months ; when, had he regularly brought suit to the term at. which the judgment was confessed, the execution would have been delayed, but three, months, it was held that by this conduct, the holder virtually made a new contract, with the maker, by which the endorser was exonerated from ail liability,
Thist canse, was tried before Nash Judge at Granville* September term 1828, and iba Defendant bad a verdict. The case stood before- this Court, on a motion for a new trial, and the far is were these. Holden executed to the Defendant -u sealed note for SGOfi, and dated 2CUi offline, 3.820. On the 28th of June 1820, the Defendant endorsed the note to Plaintiff. At the County Court of Granvüi? in August 1820, the Plain tiffwithout having issued any writ, obfained from Holden, a romfe-sshm of judgment on the note, and granted him a stay of execution until February term 1821, and an entry to this effect was made on the Clerk’s docket at the time. The Plaintiff’ offered no evidence of a demand upon the maker, except the judgment confessed by Holden. lie however offered in evidence a deed of trust, executed by Holden to Samuel ill ¡¡man on tlie 4th of November 1820, and ail iu the hand-writing of the Defendant, by which Holden conveyed certain property, in trust, for the benefit of the Defendant and other creditors j and Plaintiff contended, that this amounted either to evidence of notice to the Defendant, or a waiver on Defendant’!, part of notice. The property conveyed in trust, when solí!, was insufficient to sa- {isfy the debts intended to be secured by it, and Plaintiff, under the sale, received his proportionate share, 0440. It also appeared, that in February or March the Sheriff sold property of Holden's not included in the deed of trust, by virtue of executions issuing- on judgments obtained in November 1820. Defendant contended 1st, that there was no sufficient evidence of a de-jnand or notice, and 2d, that by taking- the confession of judgment and granting a stay of six months, Plaintiff bad made anew contract with the maker of the note, and thereby released the endorser.
: The Court charged the Jury, that to entitle the Plaintiff to recover, it was necessary he should have made a demand of Holden, and have given Defendant notice of it, and of the non-payment of the bond within a reasonable time; that what was reasonable notice, depended on circumstances, the law however, in all cases, required the assignee to uee due diligence in presenting, and that ho should as soon as he conveniently could, give notice to the endorser of the demand and dishonour of the note j that the deed of trust having been taken upwards of four months after the endorsement of the note, and only for part of Holden’s property, in no way dispensed with the. •necessity of notice : that if it was received as evidence of notice, it was only evidence at the time of its date., which, being four months and more after its endorsement, was notin reasonable time, the parties all residing in the same villagebut if they could infer from any other circumstance that the Defendant had earlier notice, they were at liberty to do so ,• and that Plaintiff having taken a confession of judgment, and given a stay of six months, when, if he had brought his suit regularly to August term, ho could only have kept it off three months without appearing, in which event the debt would have been secured, lie had virtually made a new contract with Holder, by which the Defendant was exonerated from all liability.
Hillman for the Defendant.
The Plaintiff is noten» titled to recover in this case, 1st. because lie has given no evidence of a legal demand upon the maker, or of the requisite notice to the Defendant, the endorser. The principles which govern cases of promissory notes (and bonds in t!¡is State) are the same which govern accepted inland bills of exchange. .Before the holder can recover of the endorser, it is necessary that he should shew Le has made a demand of the maker, and given reasonable notice to the endorser. In this case, there is no evidence of any demand- on the maker,- except the confession of judgment by Holden, and no evidence of any notice, except what is furnished by the deed of trusty v hick forms a part of the case. It is contended, that these are not sufficient for the reasons which will be given hereafter. As to demand and notice, and what shall constitute reasonable notice, see Chitty on Bills' Siory’s Ed. — 101, 182, 187, 201, 150, ZüQ — lsl T.'il.-168, 169 — 8d Murphey 73 — 2 Philips'1 s Evidence, IB note CaJ and the authorities there cited.
2d!y. He is not entitled to recove,", because by taking the confession of judgment from Holden at August Court,- and granting him a slay of execution from August till February term, when if suit had been regularly brought to August, and prosecuted in the usual and ordinary vvay, Holden could have kept off the, judgment and exe • eu^on only until November term, unless he had appealed, in which event the debt would have bcen'securcd, ho has made a new contract with the maker, and by giving him time, has made the debt his own, and released the endorser from all liability. “ This is a rule of law not confined to bills of exchange, for if the obligee of a bond with surety, without communication with the surety, take notes from the principal, and give further time, the surety is discharged,” Chitty 212 — sea also 8íh East, 576, cited in note (ft) of the same page. “As to giving time, the holder docs it at his peril- — aud that riremn- stance alone would be sufficient lo decide this case. For-^11 no case has it been determined that tíie endorser i;> liable after the holder of the note has given time to the ma{ier/» B idler Justice, in the case of Tindal v. Brown (1 st Term Hep. 1G9-70.)
But it is said that the. deed of trust, which forms a part of this case, amounts to a waiver of notice. This case is very unlike the cases of assignment of property of the maker to the endorser, which have been decided to amount to a waiver of notice. In those cases, the assignment was made at the time of the endorsement, or before the note fell due ; in this case, the trust is taken upwards of four months after the endorsement} and after the bond had become due, and that too, tint when it was in a regular and legal train of collection, but after the holder liad given time to the maker, and thereby released the endorser from all liability, independently of bis failure to give notice. In those cases, the assignment was taken by the endorser of tiie whole of the property of the maker, and with a perfect understanding of his liability, so that notice would have been entirely useless to him; in this case, the trust is taken by Defendant upon only apar,’: of Holden’s properly, and under a clear mistake in regard to his (Defendant’s) liability.' It will be recollected, that the deed of trust bears date the 4th day of No - vember 1820, only a few days before Granville November Court, the term at which Yancey, would, by a ¿no course of law, l»a\c obtained his judgment against Holden, and that Littlejohn (by the trust) in the same breath in which he recognizes Ids liability, speaks (if the suit of Yancey v. Holden upon that bond, as being then pending, which shews very clearly, that he was under the impression that suit had been regularly broughr to August Court, and that Yancey was ussug all due diligence to collect the money cut of Holden ■ which he probably might have dime if he had obtained his judgment and sued out his execution at November term, as it is in e\ i- dflncc that a considerable sum was made out of Holden’s property as late as February and March Courts 182 i,) whereas in truth, no suit had ever been commenced by Yancey v. Holden, but the latter had, at August Court, admitted service Of a writ and confessed a judgment in favour of the former upon his agreeing to give him a stay of execution until February, which was enleml upon the docket. If 1 be deed of trust be received as evidence of Littlejohn’s acknowledgement of his liability, we, shall surely be entitled to draw from the same source the evidence, that the admission was made under an entire misapprehension of the facts and the law of the case. If Yancey bad brought suit immediately against Holden, and used Use same diligence which he himself could have done, Littlejohn might have felt himself hound in hon-our, if not in law, to have waived any advantage which lie might have in consequence of Yancey’s having failed to give him notice. But after knowing of the arrangement made by Yancey with Holden, lie could have considered himself bound, neither m law nor in honor, to have waived any advantage which he had. Where an endorser of a promissory note, believes a demand to have been duly made ori the maker, and that notice has been duly given to himself, and believing himself therefore liable^ takes measures for his indemnity, tfiis will not excuse the holder from proving a regular demand and notice. —(9th Mass. Rep. 332 — 5lh Johnson Rep. 375 — \2thlbid, 423 — 5th Ibid. 248 — ^-'8ill Ibid. 384 — 2d Campbell 105 — - 4ih Dallas 105 — Ckitty 172 note *.) The provisions of the trust required that the money arising from the sale, should he paid, not to Littlejohn, but in discharge of the' several debts intended to be secured by it, and Yancey came in, under the trust, and received his rateable proportion $ which siiews, that he looked to Holden and to the trust fund, as the means of collecting his debt, and not to Littlejohn, the endorser, which is further evidenced by the length of time which has elapsed since, the an (lorncment before the commencement of this suit. Sure* ^ ^ ‘s w*lh an grace that he can now contend that this deed of trust, of which he has received his full be-neg^ should be considered as amounting to a waiver of notice.
So far from Yancey’s being entitled to recover front Littlejohn, had he, under all the circumstances of the case, received from him the amount of the balance of the debt, Littlejohn would have been entitled to have, recovered it back. — (Blesardv. Hirst — 5th Burr 2670, — Goodall and others v. Bollcy — (si Term Hep. 712 — >Garland v, the Salem Bank — 9ih Mass. Hep. 408.)
It is contended, however, that if the deed of trust do wot amount to a waiver of notice, that it should be received as evidence of notice. All the authorities, and most of the reasoning, upon the last point, are equally applicable to this. An acknowledgment made under an entire misapprehension, will surely not create any liability where none existed before. Suppose, however, I am mistaken in a principle, which seems so very plain that scepticism itself can hardly raise a: doubt about it, and it is considered as evidence of notice. There are two* objections to it. The one is, the. confession is made at a time, when the endorser is already discharged from liability by the holder, in consequence of the credit which lie has given the maker, and is not in reasonable time. (See the authorities before cited as to notice.) If I admit. service of a writ,- it by no means' follows that I owe the debt. ; Want of notice, is one’ of the" means by which an .indorser may be discharged; giving Credit is another, and it is humbly contended, that after proof that the holder has given credit to the maker, notice, is perfectly, immaterial. — {Chilly 212.) The other objection is, that it is not evidence of such a notice as the law requires. If it be received as evidence of notice, what kind of notice is it evidence of? Common sénse can give but one answer to this question. That it mast be received as vsyideíioe of notice of the real slate of the case, which, if drawn np in words would amount to tiiis; “ that he, Yancey, had applied to Holden for the payment of the bond, which he, Littlejohn, liad assigned to him ; that it was not convenient, for Holden to pay the money, and that he had taken from him a confession of judgment, cud as it would not suit his convenience to pay the money sooner, he had agreed to wait with him until February Court, before lie issued any execution against h«m.” What would Littlejohn have understood from sucii a notice ? That Yancey looked to him for payment? Certainly not. But suppose he had so understood it; the object of notice is to give the endorser an opportunity of taking up the note and having his remedy over, and saving himself if practicable. In tisis case, the bond had passed out of the p «session of Yancey even, and was tiled in Hie Clerk’s office, as the evidence of the debt upon which the judgment had been confessed. Neither Yancey, or Littlejohn could have any control over the bond or judgment until February Court. ” The purpose of giving notice,” says Bullet Justice, in the case of Tiudal v. Brown, before cited, “ is not, merely, that the endorser should know' that the note is not paid, for he is chargeable only in a secondary degree, hut to render him liable, you must shew that the holder looked to him for payment, and gave him notice that he did so. A, case might easily he put where the endorser might have notice from the holder, and yet would not be liable; as if, in the preseut case, the holder had written a letter to the endorser, containing the circumstances which have been given in evidence, the endorser would have been discharged ; because it would have amounted only to this: “The note made by Donaldson anden dursed by you, is not paid, and Í have given credit to Donaldson ’till to-morrow.” Though there is no pre • scribed form of this kind of notice, yet it must import ■hat the holder considers the endorsers as liable, and expects payment from him, that he may have remedy over ^ an eai'ly application; then it becomes his business to take up the note. But notice of having'given cre-¿¡j. ¡jie maker, will discharge the endorser.

Opinion:
Per Curiam.
We think the question, whether the Plaintiff made use of due diligence, and whether the notice to the Defendant was given in reasonable time, were properly left to the Jury, by the presiding Judge, and that he correctly explained to them the law arising upon the case, therefore we sec no reason why a new trial should be granted.