Court Opinion

ID: 8504851
Source: CourtListenerOpinion
Date Created: 2022-11-23 01:26:06.526071+00
Date Added: 2024-06-11T16:50:50.449369
License: Public Domain

Gilchrist, J.
This is an action brought by the bank to recover the amount remaining unpaid, for which the defendant signed the note in suit as one of the sureties of Brown.
The defence is, that the bank held a mortgage of a printing machine, made by Brown to secure the payment of the note, and that they have so dealt with this security as to impair the benefits which the sureties were entitled to derive from it.
Prom the evidence reported it appears, that the sale of the machine to Marsh, Capen k Lyon, if made at all, was made by the sureties under a power from Brown, with the concurrence of the bank, who held the relation of mortgagee, and who could do no more than consent to the arrangement. The removal of the machine to Lancaster was also made as much with the concurrence of the sureties as with that of the bank, and the evidence shows no agency of the bank whatever in its removal, nor any consent to such a measure, except as a part of the general arrangement of the sale of the chattel upon the credit which was stipulated, and to which the defendant, as associated with Kent in the power conferred by Brown, was a necessary party, and without whose consent the act of the removal was a mere tort upon all the parties interested in the property, the bank as well as the others.
The case affords no evidence from which it can legally be presumed that the bank consented to take the note which Marsh, Capen & Lyon gave to secure the price of *192the machine, as a substitute for that of Brown and his sureties. That note was in terms payable to Kent and Downing, who also received the balance of the purchase money of the purchasers. It does not appear to have been indorsed by them to the bank, nor to have become its property in any other form or manner, except so far as the transactions adverted to and the custody of the paper itself, indicate an intention of the parties that it should stand as collateral to the note of Brown.
It is said that the defendant was entitled to receive notice from the bank, of the omission of Marsh, Capen & Lyon, to pay the stipulated checks or installments upon the note, as well upon the ground that Dr. Morril agreed to give such notice, as that the by-laws of the institution require it to be given in all cases of default.
But it does not appear that that'agent of the bank had any authority to make such an agreement in its behalf, either expressly conferred, or resulting from any relation in which he stood toward that institution. If the agreement binds any one by force of any consideration on' which it was based, it can not extend beyond the individual who made it, or be regarded as any thing more than a personal undertaking of that party.
- As to the by-law, if it can be supposed to have been made for the advantage of those dealing with • the bank, and as containing a stipulation to be kept by that institution in all cases, as a condition preliminary to enforcing the payment of the securities which they take in the way of their business, it must have been unadvisedly adopted. It is more reasonable to suppose its purpose to have been, to establish a rule for their own convenience and protection, and not to lay the foundation of such a claim as is here set up.
As an additional ground of defence, it is said that the plaintiffs consented to give an extension of the time *193arranged, for tbe payment of the note of Marsh, Capen & Lyon.
It is a general rule, that if a payee by a valid contract give time to the principal without the assent of the security, the latter will be discharged. Bank v. Woodward, 5 N. H. 99. But the agreement for delay must, like other agreements, be made upon a good consideration, in order to be valid, and the promise to pay interest contained in the note itself, is not a sufficient consideration for a promise on the part of the creditor to delay its collection ; and notwithstanding any such agreement either the principal or the surety may pay it when he pleases. Bailey v. Adams, 10 N. H. 164. Nothing is better settled than that mere delay to sue, without any binding agreement to do so, between the creditor and the principal debtor, does not injure the surety or exonerate him from his undertaking. Bank v. French, 21 Pick. 489.
The note upon which the installment was due, was payable in terms to the sureties. No agreement which the bank could have made, would probably have prevented their commencing a suit upon it for the recovery of any part of it which might be due, unless some special power, of which the ease presents no evidence, had been by them conferred upon the bank for that purpose.
But the decision is sufficiently based upon the ground that no valid agreement for delay was made which would have bound the bank itself.
The conclusion therefore is, that the evidence does not furnish a defence to the action. The verdict must be set aside and a

New trial'granted.