Court Opinion

ID: 3495583
Source: CourtListenerOpinion
Date Created: 2016-07-05 22:03:26.717732+00
Date Added: 2024-06-11T14:05:13.111210
License: Public Domain

[EDITORS' NOTE:  THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *Page 155 
Defendant, in the order of signing, was the fifth and last indorser upon a promissory note given by the Bush  Lane Piano Company, a corporation, *Page 156 
February 24, 1928, payable in one year to plaintiff at the Holland City State Bank. The note was left by plaintiff at the bank for collection, with instruction that it be renewed without inclusion of three of the original indorsers, whose names preceded that of defendant, and a renewal note, due in one year, was so executed, upon which, by such omission, defendant became, in order of signing, the second indorser. This suit is against defendant as indorser of the renewal note. Upon trial by jury plaintiff had verdict but the court, upon motion, entered judgment for defendant. Plaintiff reviews by appeal.
One question is whether defendant was released from liability on the note in suit by reason of plaintiff's intentional omission of the three original indorsers, who were prior to defendant in the order of indorsement.
As between indorsers, not joint, the order of signing is of moment. 2 Comp. Laws 1929, § 9317 (Stat. Ann. § 19.110), provides:
"As respects one another, indorsers are liable prima facie in the order in which they indorse; but evidence is admissible to show that as between or among themselves they have agreed otherwise."
In the brief of appellant it is stated:
"Briefly reviewing the evidence, it is agreed between plaintiff and the defendant that the indorsers were not joint indorsers, but were liable in the order named," but it is claimed that, "when defendant indorsed the note, he assented to the release of prior indorsers."
The quoted statute is declaratory of a relation between successive indorsers beyond change in a renewal note without the knowledge or consent of the indorser affected thereby. *Page 157 
Under the original note there was successive liability of the indorsers, in the order of their indorsement, and the intentional omission of three of the former indorsers deprived defendant of remedy he would otherwise have against them.
We have been unable to find the date of the original note, but do find that it and the renewals thereof from year to year, preceding the renewal in suit, had the same five indorsers, with the defendant the fifth in the order of signing.
Defendant testified that the renewal in suit was presented to him for indorsement and nothing was said about omission of former indorsers and, in signing, he relied upon the fact that the signatures of the other indorsers would be obtained upon it as in former renewals, and the first he knew that the other indorsers were not on the note was in October, 1933, some four years after his indorsement and, after his indorsement, he did not see the note until after this suit was brought. This testimony was admitted over objection, and properly so, in this action by the original payee who had directed that former indorsers be omitted on the renewal note without so informing defendant.
A renewal note merely extends the time of payment by the original maker or indorsers in the absence of modification by agreement. Upon the original note and renewals thereof, previous to the renewal in suit, defendant incurred a contingent liability resting upon the contract obligation attached by law to his relation as a successive indorser, with the primary obligation upon indorsers preceding him in the order of signing and secondary obligation on him, with remedy over if exacted and met.
When plaintiff accepted the original note and renewals, previous to the one in suit, he took with required recognition of such rights of the indorsers *Page 158 inter se and was precluded from bringing change therein without the knowledge and consent of defendant.
Defendant testified that he would not have indorsed the renewal note in suit if he had known that the three previous indorsers were released by direction of plaintiff.
Under the original note and renewals thereof, preceding the one in suit, there was successive liability of the indorsers in the order of their indorsement and the omission of three indorsers by direction of plaintiff deprived defendant of remedy he otherwise would have against them.
The indorsements on the original note and renewals thereof preceding the one in suit constituted the signers successive indorsers with obligations and rights inter se.
The note in suit was a renewal without agreed change in the relation.
The fixed relation, so established by the repeated acts of the indorsers, required continuance, and had the three released indorsers signed the note following defendant's signature, their relation to defendant would be governed by their established status inter se rather than by such a departure therefrom without agreement.
Plaintiff claims that defendant, by subsequent assurance that the note would be paid and that his indorsement rendered payment certain, thereby waived the omission of former indorsers and is estopped from now pressing the point of his release.
All matters alleged as a basis for holding there was a waiver and estoppel occurred previous to defendant's knowledge that the former indorsers had been omitted. We find no subsequent relinquishment of a known right or assumption of liability by defendant constituting waiver or calling for a judgment based on estoppel. *Page 159 
The circuit judge was right in entering judgment for defendant notwithstanding the verdict, although he gave another reason than that here mentioned for his action.
The point we have discussed was included in defendant's motion for a directed verdict and for judgment notwithstanding the verdict, and our holding renders it unnecessary to consider other points relative to waiver and estoppel.
The judgment is affirmed, with costs to defendant.
BUSHNELL, C.J., and SHARPE, POTTER, CHANDLER, NORTH, McALLISTER, and BUTZEL, JJ., concurred.