Court Opinion

ID: 6654603
Source: CourtListenerOpinion
Date Created: 2022-07-20 20:56:51.661454+00
Date Added: 2024-06-11T15:59:50.766603
License: Public Domain

Ames, C.
On a reargument of this case the question discussed in the briefs of counsel is whether the former decision [ante, page 242), is right in holding that the answer does not state facts sufficient to constitute a defense to the petition. We think that decision is right. The opinion was not, as we understood it, intended to controvert the proposition that under our practice an equitable defense may be pleaded in an action at law, or that issues of fact raised by the reply to an answer pleading such a defense, may be submitted to the jury. If it be granted, which we do not feel called upon now to decide, that an unreasonable neglect or delay by a creditor to sue a principal debtor upon being requested so to do by a surety, followed by the insolvency of the former, operates as a release of the latter, still we do not find that issue to have been tendered by the answer. It is alleged that the creditor was informed at the time the request was made that the principal was “solvent and able to pay same [viz., the note in question], but that he was in failing circumstances and was compelling his creditors to bring suits against him in order to collect debts due.” How both items of information could have been true is not explained, and it is not distinctly alleged that either of them was so. Neither is it averred that his condition in either respect afterwards changed for the worse. The answer does charge that the plaintiff subsequently acquired title to the principal’s farm “and took and received *248from the said Russel chattel liens, being chattel mortgages upon all the personal property, goods and chattels, of the said Russell, and from that time until the present time has renewed and kept in force said chattel liens, thereby fraudulently covering up and incumbering the property of said Russell to hinder and delay his bona-fide creditors from collecting their just demands against said Russell.” But it is not alleged that the liens were obtained or continued with actual fraudulent intent, or without consideration, or in violation of any positive law. Neither is it alleged that Russell’s insolvency or ability to pay was any less after these transactions had taken place than previously. There is in fact no distinct allegation that he ever became insolvent. For aught that is alleged he may have property other than that mentioned in the answer from which satisfaction of the note may be obtained. But even of such property there is, if the answer be true, a sufficient amount for the indemnity of the defendant. It “charges the truth to be that the said Russell is the bona-fide owner and possesses the equitable title * * * and has the right and authority to sell and dispose of” a farm mentioned in the answer, the legal title to which is said to be in the plaintiff as security for an indebtedness of $2,200, and accrued interest, “and no more,” and the value of which is alleged to be $7,000. As is said in the former opinion, the mere fact that a creditor has in his hands property of a principal debtor sufficient in amount to' pay or secure the debt, does not of itself operate to release the surety, because it does not of itself put it out of the power of the surety, after payment of the debt, to resort to the property for his indemnity. If the answer had pleaded in issuable form that the principal' was insolvent, and that his property was fraudulently incumbered or concealed by the plaintiff, so as to delay or embarrass the surety in obtaining indemnity, it would have stated a complete defense at law. We do not think that by such means the creditor can drive the surety to the tedious, expensive and doubtfully efficacious remedy of an accounting in equity.
On motion to amend the foregoing decision and judgment, the following opinion, denying the motion, was .filed on May 20, 1903:
Rule of Practice: Appeal in District Court. The rule of practice requiring the issues triable in the district court upon appeal to be the same as those in the same case in the court from which the appeal is taken, applies to the substance only, and not to the. form of the pleadings by which such issues are tendered or raised.
It is therefore recommended that the former decision of this court be adhered to, and that the judgment of the district court be reversed and a new trial granted, with leave to defendant to amend his answer.
Duffie and Albert, CC., concur.
By the Court: For the reasons stated in the foregoing opinion, it is ordered that the former decision of this court be adhered to, and that the judgment of. the district court be reversed and a new trial granted, with leave to the defendant to amend his answer.
Reversed and remanded.
Ames, C.
This is a motion to amend the former decision and judgment of this, court by expunging therefrom the leave granted to the defendant in error to amend his answer in the district court. The motion is supported by a transcript of proceedings, which was not contained in the record upon which the cause was argued and submitted, and which discloses that the action originated in the county court of Cass county, and that the pleadings upon which it was tried in that court and in the district court are identical, and it is contended that the leave to amend, granted by this court, permits issues to be raised in the district court differing from those in the. county court, contrary to the established practice in such cases.
We do not think the matter thus brought to our atten*250tion is sufficient to call for the granting of the order asked for. The defense in the lower courts was that the plaintiff, who is the payee in the note in suit, has fraudulently incumbered and concealed the property of the principal maker, to the embarrassment, delay and injury of the defendant, who was obligated upon the note as surety. This court held that these facts, if proved, are a complete defense at law as well as in equity, to a suit against the surety upon the instrument, but that they were so defectively pleaded as not properly to define the issue. The leave to amend,- of which complaint is made, does not purport to grant the defendant permission to tender any new matter as a defense, but to so amend his pleading as to render available that of which, because of defective statements in his answer, he was deprived of the benefit. The granting of such leave was not error. It has repeatedly been held by this court that the rule of uniformity, which the plaintiff invokes, applies to the .substance only, and not to the form of the issues in the district and inferior courts.
There is no merit in the motion and we recommend that it be denied.
Duffie and Albert, CC., concur.
By the Court: For the reasons stated in the.foregoing opinion, it is ordered that the motion be denied.
Motion denied.