Court Opinion

ID: 6142898
Source: CourtListenerOpinion
Date Created: 2022-02-05 14:43:30.62876+00
Date Added: 2024-06-11T08:54:43.304726
License: Public Domain

By the Court. Ingraham, First J.
The referees in this cause have reported in favor of the plaintiff for §420 94, and the defendant appeals from the finding of the referees and the judgment thereon.
The plaintiff, on the argument, was willing that the report should be set aside, to which the defendant’s counsel objected, alleging that the facts had all been passed upon by the referees, and that the only question was as to the proper judgment to be rendered thereon.
Upon this point there can be no doubt. If the facts are all found by the referees, and the appellant does not object to the decision upon the facts, there is no ground for setting aside the report in that respect.
When the facts are correctly found, and the error" is one of law in giving the judgment, the court on appeal may give the judgment for which the referees should have reported.
Upon the hearing before the referees, these facts were established and reported upon by them :
1. That for five payments of §100 each, made by the decedent on the defendant’s account, upon the order described in the complaint, and admitted in the answer, there was due a balance for principal and interest amounting to the sum for which the referees reported in the plaintiff’s favor.
2. That Collins recovered against the defendant a judgment *438for $1,080 25, upon three notes which were endorsed by the defendant for the accommodation of Samuel Hannay, the intestate, and that the defendant was only liable thereon as accommodation endorser for his benefit. .
3. That the other items claimed by the plaintiff were not sustained by proof.
And as matter of law, they decided that the defendant was not entitled to any relief in this action, by reason of the recovery of the judgment of Collins against him.
In the answer, the defendant asks to have the amount of the plaintiff’s claims set off againt the judgment—or that an order be made in this action requiring said plaintiff to pay the amount of Collins’ judgment, after deducting the claim in this action.
At law it is well settled that a surety has no claim against his principal until he has paid something on the liability he has incurred. The recovery of a judgment, and even imprisonment on a ea. sa., would not entitle Mm to any remedy. (Powell v. Smith, 8 J. R. 192; Hunt v. Amedon, 4 Hill, 345.)
But in equity a surety may apply for such relief as will compel the debtor to pay the debt, and the creditor to receive payment. (Warner v. Beardsley, 8 Wend. 194; Gibbs v. Menard, 6 Paige’s C. R. 258; 3 Swans, 368.)
The question then arises, whether the defendant, in an action against him on a note which he admits to be due, may set up as a defence in his answer that a judgment had been recovered against him for another claim, in which the plaintiff was the principal and he the surety, and obtain therein affirmative relief, directing such judgment to be paid.
By the 149th section of the Code, the defendant is allowed to set up in his answer any defence or counter claim to the plaintiff’s cause of action.
By the 150th section, such defence and counter claims may be set forth in the answer, whether legal or equitable, or both.
And by section 274, the court may grant to the defendant any affirmative relief to which he may be entitled.
The answer sets up the recovery of this judgment, and that *439it was upon endorsements of the defendant for the accommodation of Samuel Hannay, the intestate. The reply of the plaintiff denies these allegations, and also avers that the defendant has not paid the judgment so recovered against him.
I see no reason why the plain intent of the provisions of the - Code should not be carried but in such an action. Both parties have had the opportunity of answering the other’s claims in pleading.
The plaintiff’s and defendant’s claims both arise upon contract. The defendant would be entitled to the relief he asks for if he had commenced an action for that purpose, and the Code says he may obtain any relief he may be entitled to, although defendant. (See 3 Sand. 688; 5 How. 192, 216, 272.)
That some confusion will arise from thus blending together legal and equitable proceedings, is evident. The case could not be tried by a j ury in the ordinary way, although merely for the recovery of a sum of money on a note ; and the introduction of an equitable defence renders it necessary that after the finding of the facts, the court should direct the judgment proper to be entered in the cause.
But these difficulties can be surmounted, and as it is apparent that the legislature intended, by the amendment made to the 274th section of the Code in 1852, to sanction such a defence, I see no other course but for the court in good faith to conform their practice thereto.
The affirmative relief, however, which the defendant should have in such a case, ought not to extend beyond what becomes necessary to constitute a defence, either legal or equitable, to the plaintiff’s claim. He would have no right to claim from the plaintiff any moneys but what would arise on a contract, nor to ask for a judgment in his favor for matters which did not constitute a defence to the plaintiff’s claim. Under this restriction, I see no difficulty in carrying out the provisions of the Code.
We think that the report of the referees contains all the finding of the facts necessary to the final decision of the case; that *440the plaintiff has a claim, against the defendant to the amount reported due by the referees ; that the defendant is entitled to a judgment directing the plaintiff to pay the amount of the judgment so recovered against the defendant, as surety of the plaintiff, after deducting the sum reported to be due to the plaintiff by the referees; and that the defendant may pay such amount on the said judgment, and on payment thereof that the same shall be deemed a satisfaction of the plaintiff’s claim in this action.
We think, also, that as neither party took the proper proceedings to settle the claims between them in the first instance, neither party is entitled to recover costs against the other.
Judgment modified so as to direct that the plaintiff pay to Collins the judgment recovered by him, as set up in the answer, against the defendant, as surety, deducting the amount reported due in this cause, and that the defendant may thereupon pay to Collins the amount last mentioned, such payment to be in full of the plaintiff’s claim in this action. No costs of appeal allowed to either party.