Case Name: Pierce Butler, vs. Paul Hamilton, Comptroller General
Court: Court of Chancery of South Carolina
Jurisdiction: South Carolina
Decision Date: 1804-06
Citations: 2 Des. Eq. 226
Docket Number: 
Parties: Pierce Butler, vs. Paul Hamilton, Comptroller General.
Judges: [Present, Chancellors Rutledge, Marshall and James.]
Reporter: South Carolina Equity Reports
Volume: 2
Pages: 226–231

Head Matter:
[Present, Chancellors Rutledge, Marshall and James.]
June, 1804.
Pierce Butler, vs. Paul Hamilton, Comptroller General.
A security to certain bonds is not released from his liability, merely on the creditors not urging the demand. There must bean express extension of credit to the principal. If one of the bonds has been pursued diligently, and an execution has been returned nulla tona, there is less necessity to sue the others.
THE bill was Fil'd to obtain relief against the liability of the complainant, on three bonds, executed by him, to-gethef^rith Daniel Bourdeaux, and rs his^security to the commissioners' of the treasury.
The bill states, that on the 5th day of-1787, complainant entered into three bonds'as surety to Daniel Bour-deaux, now deceased, payable to P. Bocquet and J. Mitchell, thetreasurers and their successors.^ office. Each bond conditioned for the sum of 781/. 11s. s£ with interest from the date. That the said three bonds were payable in three annual instalments, to wit: on the 12th March, 1788, 1789 and 1790. That the said bonds were not signed by Joseph Atkinson, as they were to have been, as will appear by reference to exhibit A. and insists that it was incumbent on Mr. Boquet and Mr. Mitchell to have procured the same, as the name of Mr. Atkinson was inserted in said bonds, and it was intended and meant at that time that the signature of Mr. Atkinson should have been to the said bonds.
Bill states that judgment was obtained on the first bond against said Bordeaux, and your orator, in the year ,1789, That no proceedings were ever had on said judgment or on the other bonds against said Bordeaux or your orator. That your orator conceived that all the said three bonds were paid by the above mentioned.D. Bordeaux, the principal, until Mr. Hamilton the comptroller applied to your orator for payment of them.
The bill further states, that after the said bonds were due and payable, your orator applied to know if they were paid at the treasury by Mr. Bordeaux. That he was informed that on search the said three bonds could not be found, and that they must have been paid; and that from the nature of the debt, he conceived that due diligence would be used; and that if your orator-had known that the said bonds had not been paid, he could have had an indemnity from Mr. Bordeaux. That the application to the treasury was made expressly to see if the bonds were paid, he then having in his hands, bonds and other assurances of Mr. Bordeaux, as will appear by exhibit'B. • That the said bonds and assurances, of Mr. Bordeaux were well secured by a mortgage of real property, and were given up to Mr. Bordeaux under the idea that his bonds to the treasury were paid. That under all the circumstances, the lapse of time, the gross laches in the officers of the state, and the not inserting the name of Mr. Atkinson, as was originally meant and intended, that he should be a party to the said three bonds, it would now be unreasonable to compel your orator to pay the said three bonds.
The bill further states, that complainant 'holds by as signment certain lands of Mr. Bordeaux, as security against any securityship he might have entered into for j\fr< Bordeaux; and that the proceeds of these lands when recovered, he is willing to pay on account of those bonds preferably to indemnifying himself. Bill prays that complainants name may be struck out of said bonds, and that he may be fully relieved in the premises, &c.
The answer of the defendant admitted the execution of the bonds, but stated the ignorance of the comptroller-general of the other facts charged by the complainant.
The cause came to a hearing, and Mr. Gaillard and Mr. Paeker argued for the complainant.
That it was manifestly intended that Mr. Atkinson should have been joined in the bonds, his name being inserted as a co-obli-gor; yet he never executed them ; that the state treasurers were bound to have procured the execution by him, and complainant would not have signed them- unless he had understood that Atkinson was to have signed also. — • 1 Powel, 316, 395. 2 Pow. 196, Loft’s Rep. 113. That the complainant called at the treasury, and was told, his bonds were paid; and he in consequence gave up a counter security which' he had received from Bordeaux, the principal. That the treasurers were in the habit of giving indulgence on bonds due to the state, as was proved by Col. Moultrie, the former attorney-general. That in fact the principal had not been pressed for ten years, which was an indulgence that the creditor had no right to give the debtor at the risk óf the security. 2 Bro. C. C. 579. 2 Vesey, jun. 540. 4 Vesey, jun. 824. 3 Atk. 80. That the treasurers were bound to have collected the debt summarily.
That the letter of complainant acknowledging his liability, was written when not advised of his rights, and ought not to bind him. That the confirmation of an obligation not existing, is inoperative. 3 P. Wms. 306. 1 Fonb. 115. 1 T. Rep. 112,285.
That the case of Nesbit and Smith, in 2 Bro. C. C. has -settled the law, and shews that this court will give relief to the security, where the creditor extends the time of payment to the principal.
On behalf of the state, Mr. Pringle, the attorney-general, argued that with regárd to • one of the bonds there could be no doubt, for it was sued when due, and judgment obtained in 1789, and due diligence used to recover the money. That it would have been useless to pursue the principal on the other bonds, as he was insolvent, and nulla bona returned on the execution on the first bond.
That the leaving out Atkinson was not a misrepresentation to affect the complainant. To obtain additional security, was merely intended to strengthen the security of the state.
That any application should have been made to the attorney general, ini whose hands the papers were, and notto the treasurers. That the cases in which the Court of Equity has given relief to securities are unlike this ; for they are cases where the creditor varied the contract, or gave further time expressly, and these are not applicable to this case, for there was no express extension of credit.
If complainant had wished the principal pressed for the debt, he should have required it to be done. The letter of complainant was written deliberately, and bound him.

Opinion:
After the hearing, Chancellor Rutledge delivered the decree of the court. -
This is a case of the first impression, and of considerable magnitude, as it relates to the monied interest of this country. It has never before been fully discussed, therefore the court took time to deliberate on it. It. has been heretofore a generally received opinion, that the principal and security in a bond, were at all times equally liable for the payment of the debt, as long as the bond existed; and under that impression, payment has never till lately been resisted by the security, when called upon. Some modem adjudications in the Court of Chancery in England, have however shaken former opinions: and it is now set- tied, that the secui'ity is not liable to the extent it was be* lieved ; and that a Court of Equity under peculiar circumstances would give relief, and has actually given it in se-vNral cases. It was never doubted, that a security had a right to call upon the obligee to sue the principal and obtain payment of the debt from him, and if he refused to do so, by an application to this court, the obligee would be compelled to bring suit for that purpose. The grounds for relief in equity, in the case of sureties, are various. That the obligee has not used due diligence to recover his debt from the principal in the first instance, and has refused or neglected to comply with the sureties request, to use that diligence : Also, that the creditor has extended the Credit linger than the parties contracted for, against the sureties consent. The second ground is the strongest; it is on that, and that only, that the court has uniformly determined in favor of the surety. All the cases are bottomed cn that principle, that the surety is only responsible for a limited time ; and if the obligee will extend the credit to a longer period, against the will of the surety, he shall be discharged ; for it is both unreasonable and inequitable, that a man should always have such a cloud hanging ever him. Mo one could say what estate he had " left 1'oMiis family, if he was to be liable beyond the time he contracted for. His estate might continue to be so, in the" hands of his heirs or legatees to the most distant period. The plain simple question then is, whether the complainant, from the peculiar circumstances of this case, is entitled to relief, on the principles of the adjudged cases ? With respect to the first bond, there is not the smallest ground whatever for relief; because it was put in suit, and judgment and execution obtained against him, and Bordeaux, the principal, as soon as it could possibly be done. What availed the due diligence ? Was any part of the debt received in consequence of it, from Bordeaux ? Not a penny. Was h 'm a situation to pay ? We presume be was not. For what purpose then sue the other bonds i Bid the complainant ever apply to the treasurers to do it ? It does not appear that be ever did ; and for tbe best of reasons, because it would net have advanced his interest, and would have been attended -with additional expence. When he made tbe application to the ti easur-ers, to know if the bonds were taken up, is not stated, nor is it a material circumstance, because he could . have got the information from Bordeaux himself; ar.d hem the complainants own confession, as stated in his bill, he had ample means in his own possession, to secure himself completely. He knew judgment had been obtained against him on one bond. It was therefore his interest to see that that was satisfied in the first instance; and also the other bonds afterwards, and before he parted v, itb. the funds he .was possessed of. If he gave up some of them to Bordeaux without being ascertain- d whether the bonds in question were or were not taken up, and has made a bad bargain in the disposition of the rest, be has only himself to blame. The neglige nee of the public officers ought not to be used as a shield, to protect him against his own supineness. Upon the whole, the court are unanimously of opinion, that the complainant is not entitled to relief on the ground of negligence, with gard to the first bond, because due but unavailingjdiSé iwe^ was used to recover the money on.that. Nor . tied to relief on the other bonds, upon the gr! tending the credit beyond the time contracted fi he has not made it appear that such credit either expressly or impliedly against his consent\>r" nation. This case therefore is not similarly c stanced, nor does it come within the reason or equity of the lately adjudged cases. And lastly, because fr< m complainants own confession, it appears he was fully indemnified for his suretiship by the funds deposite- d with him, for that purpose, if he had made due and proper application of them.
Bill must be dismissed with costs.