Court Opinion

ID: 6994797
Source: CourtListenerOpinion
Date Created: 2022-07-24 03:31:20.615904+00
Date Added: 2024-06-11T16:09:44.166113
License: Public Domain

Me. Justice Watermah delivered the opinion of the Court. As stated by counsel for appellants, “ The defense to this suit is based entirely upon the proposition that at the time the note upon which the suit is brought matured and became payable, the appellants were sureties only for the payment of the debt, and the failure and refusal of appellee to recognize this right, and his refusal to foreclose the mortgage and take possession of and protect the property when the property was sufficient to pay the debt; and, further,' because of the refusal of appellee to bring any suit at all in accordance with the statutory notice served on December 12, 1890, appellants have become wholly released and discharged.” This position of the defendants in effect is, that a debtor can at any time, without the consent of his creditor, convert himself from a principal, bound to pay in all events, into a mere surety, responsible only for a failure of Ms creditor to realize, as far as by diligence he can, out of security the amount of his debt. In other words, that a debtor of his own accord may vary the terms of his contract. That this can not be done, is so plain as to make discussion almost superfluous. Appellants borrowed money and gave their absolute, unconditional note therefor. The fact that therewith, to secure the same, they executed a trust deed upon their property, did not impair or lessen the obligation imposed by their nóte. The surety given was for appellee’s benefit, not theirs, and if he has seen fit not to foreclose upon his security, but to rely entirely upon their promise, he has merely sought to enforce their unqualified obligation. A debtor can not, by a sale and conveyance of the property he has pledged .as security for his debt, change his relation to his creditor; as between himself and a third party, who has undertaken to pay his debt, he may become a mere surety, but as between himself and his creditor, he remains a principal. James v. Day et al., 37 Iowa, 164; Corbett v. Waterman, 11 Iowa, 86; Massie v. Mann, 17 Iowa, 132-135; Marsh v. Pike, 1 Sandf. Ch. 210; Waters v. Hubbard, 44 Conn. 340. As between the debtor and the party who, upon purchase of the equity of redemption in the thing pledged, has contracted to pay the debt, such purchaser and the pledgee stand as security; but the obligation of the original debtor to his creditor remains unchanged. Marsh v. Pike, supra; Jumel v. Jumel, 7 Paige Ch. 591; Dean v. Walker, 107 Ill. 540; Shepard v. May, 115 U. S. 505; Jones on Morts., Sec. 742 a. In such case the original debtor can pay the debt and then proceed against both the pledgee and the surety. Brandt on Suretyship, Sec. 37; Taylor v. Beck, 13 Ill. 376-387; Ayers v. Dixon, 78 N. Y. 318; Eddy v. Trover, 6 Paige Ch. 521; Kane v. The State, 78 Ind. 103-107-108; 1 Story’s Eq. Juris., Sec. 327-639. Counsel for appellants urge that when the loan was made appellee knew that a sale of the property was contemplated to one who would assume the incumbrance thereon, and become the principal in respect thereto; and that appellee was, therefore, bound to observe all the duties which a knowledge of such changed relation required. Whatever negotiations there were between appellants and appellee prior to the making of the note and mortgage, were merged in those instruments; the writings express the relation and rights of the parties. Moreover, the party to whom it was represented appellants would sell the property did not become its purchaser, or assume payment of the obligation of appellants. In reference to section 1 of chapter 132 of the Revised Statutes of this State, it is sufficient to say that appellants, as between themselves and appellee, never became mere sureties, but remain, as they undertook to be, principals. It is urged that the bill of exceptions fails to show that the note upon which, in open court, judgment was entered, was introduced in evidence when appellants were allowed to file pleas and have the cause tried upon its merits. The bill of exceptions does show that a certified copy of the note was before the court upon the trial, and that such copy was, by consent of appellants, introduced in evidence in the place of the original, and that testimony concerning it was given from which its date, amount, maturity, interest and makers clearly appear. The trust deed was also introduced in evidence, and its execution by appellants proven; upon its recitals judgment might be had. The judgment entered in term time is presumed to have been rendered upon sufficient evidence. The warrant of attorney filed with the note when the judgment was confessed, authorized a confession for the amount of the note, and an attorney’s fee of five hundred dollars. Only two hundred and fifty dollars for attorney’s fees was included in the judgment. The propriety of such allowance and the sufficiency of the evidence to warrant it, must be presumed to have been passed upon when the judgment was entered. Ho specific objection to the amount of the judgment was made in the court below; and nothing appears in the record showing that the amount of attorney’s fees allowed by the Circuit Court was excessive or unwarranted. Appellants have not shown that the judgment entered against them was in any respect unjust, while it does appear to have been fully warranted by the papers filed and the actual relation of the parties. The order of court that the judgment entered, stand, is affirmed.