Court Opinion

ID: 6738577
Source: CourtListenerOpinion
Date Created: 2022-07-20 23:20:20.913693+00
Date Added: 2024-06-11T16:01:53.133484
License: Public Domain

Birdzell., J.
(concurring specially). I concur in the reversal of the judgment and in the order remanding the cause for the purpose of determining the damage sustained by the defendant caused by the surrender of and failure to regain the bank stock which was held by the plaintiff as collateral to the note in suit. I can see no occasion, however, for construing any section of the Negotiable Instruments Law in deciding this case. The only question arises upon the counterclaim, and the counterclaim is based upon the right of a surety to recover damages where the creditor has allowed securities available to him to become dissipated. So far as I can discover from a careful reading of the Negotiable Instruments Law, it contains no provision which could possibly have any bearing upon the right of the defendant to counterclaim his damages unless it be the provision § 7080 of the Compiled Laws of 1913, which provides that “in any case not provided for in this chapter, the rules of the law merchant shall govern.” The right of a surety to be compensated for damages in such-cases as the one at bar is so well established in both the common law and the law merchant that authorities need not be cited in support of the proposition.
In my judgment there is no occasion here to refer to the doctrine *300of First Nat. Bank v. Meyer, 30 N. D. 388, 152 N. W. 657, nor to express any opinion concerning the correctness of that decision. In that case there is much discussion as to the effect of an agreement between the principal debtor and the creditor extending the time of payment without the consent of the surety and without a reservation of the rights against the surety. It appears that the counsel for the respective parties considered that the case was controlled by certain sections of the Negotiable Instrument Law, and that the case was decided upon the theory presented and aigued. Reference to the facts in that case, however, will disclose that there was no agreement between the principal debtor and the creditor extending the time of payment. On the contrary, the defendant surety predicated his damages wholly upon the claim that a judgment in the plaintiff’s favor against a garnishee had been compromised to his detriment.
Notwithstanding the degree of similarity between the facts in the Meyer Case, supra, and the case at bar, it seems to me to be clear, as it is to the majority of the court, that this case does not involve the effect of an agreement between a creditor and a principal debtor extending the time of payment. Nor does it involve any proposition analogous to that. Inasmuch as the counterclaim does not rest upon any right which is either defined or qualified by the provisions of the Negotiable Instrument Law, I can, as indicated above, see no occasion for referring to previous constructions of the various sections of the law. It is for this reason that I express no opinion upon one of the propositions discussed in the opinion of Judge Grace, and which is further discussed, with contrary conclusions, in the opinion of Judge Christianson. I concur in the result because of the inexcusable failure of the plaintiff bank to realize upon the security which, as between it and the defendant surety, it was bound to apply to the payment of the obligation. The defendant’s damages are properly measured by the value of the stock at the time the bank should have asserted its claim thereto as against Erie Stafne.