Court Opinion

ID: 3876221
Source: CourtListenerOpinion
Date Created: 2016-07-06 09:09:09.080167+00
Date Added: 2024-06-11T07:41:45.559994
License: Public Domain

I concur in reversing the judgment of the Circuit Court, but being unable to agree with Mr. Justice Gary in the view that Mahon, the defendant, is a maker of the notes sued on, I state briefly the reasons why I think he is clearly liable as indorser, as alleged in the complaint.
The action was brought on three promissory notes by Bank of Spartanburg as indorsee and holder against G.H. Mahon as indorser. The appeal is from an order of nonsuit granted after evidence of the following facts: In 1904, James Stewart, a firm merchandising in Spartanburg, obtained three blank notes from the plaintiff, Bank of Spartanburg, and after filling the blank for the figures on each of two of the notes with the figures $2,000 and on the other with the figures $2,200, leaving all the remainder of the unprinted portions blank, they sent the notes to the defendant, G.H. Mahon. Mahon wrote his name across the backs of the notes and returned them, intending James  Stewart to use them in the plaintiff bank, but without giving any instructions as to the manner in which the blanks should be filled in. James  Stewart signed the notes and took them to the bank, and the cashier filled out the blanks, inserting the name of G.H. Mahon as payee, and discounted the notes for the credit of James  Stewart. Upon maturity, the notes were protested for non-payment. The motion for nonsuit was granted on two grounds: "(1) That the bank has failed to prove the title to these notes. (2) That the undisputed testimony *Page 260 
shows that Mr. Mahon indorsed these notes in blank, and that they were subsequently written out and signed by James  Stewart at Spartanburg, Mr. Mahon not being present, and that the insertion by the bank of the name of Mr. Mahon as payee of the notes was in violation of his right as indorser, and made for him a contract which the bank had no right or authority to make."
When Mahon wrote his name across the backs of the incomplete notes and turned them over to James  Stewart to be used by them, he constituted them his agents to have the notes filled out in such form as would make him liable to the holder. If they had inserted the name of Bank of Spartanburg as payee before presenting them for discount, in that form he would have been liable to the bank as maker.Stoney v. Beaubien, 2 McM., 319; Cockrell v. Milling, 1 Strob., 444; Baker v. Scott, 5 Rich., 310; Carpenter v. Oaks, 10 Rich., 17; McCreery v. Bird, 12 Rich., 556; Watson v.Barr, 37 S.C. 463, 16 S.E., 188; Johnston v. McDonald,41 S.C. 81, 19 S.E., 65. But when they carried them to the bank for discount with the name of the payee in blank, the insertion of defendant's name as payee was merely a completion of the notes so as to place him in the position of indorser. By signing his name on the backs of the notes and sending them to James  Stewart to be used by them, he placed in them the power to impose upon him the liability of either a maker or an indorser, according as they saw fit to insert the name of the bank or the name of the defendant as payee. Mahon thus expressed his intention that his signature on the backs should relate forward to the time when the notes should be filled out and completed, and that he should be liable as indorser if the parties to whom they were entrusted or the bank at which they were discounted should insert his name as payee or as maker, if the name of the bank should be inserted as payee. The notes were filled out in the precise from necessary to fix upon him the liability of an indorser as distinguished from a maker, and the Court will give effect to his intention that his signature on the back *Page 261 
of the note should relate to the time of its completion and discount, and hold him liable as an indorser. The case ofAiken v. Cathcart, 3 Rich., 133, is conclusive on this point, and the cases of Armstrong v. Harshman, 23 Am. Rep., 665;Frank v. Lillenfeld, 33 Grat., 377 (Va.); Michigan Ins. Co.
v. Leavenworth, 30 Vt., 11; Kayser v. Hall, 28 Am. Rep., 624; Weston v. Myers, 33 Ill., 424; Dunham v. Glogg,30 Md., 284; Schooler v. Tilden, 71 Mo., 580, are to the same effect. These with other authorities sustain the principle that the bank where the note was to be discounted had the right to insert the name of the indorser as payee. On the note so completed he was manifestly liable as an indorser and not as a maker.
The point was strenuously pressed in argument that the nonsuit should be sustained on the ground that there was no proof that the defendant was an indorser for value, as alleged in the complaint, as distinguished from an accommodation indorser. Assuming without deciding that there was no proof of consideration to the defendant for his indorsement, that could not acquit him of his liability as indorser to the bank which discounted the note. The fact that the bank parted with money or something else of value on the faith of the indorsement is sufficient to support the allegation that the defendant as to the bank was an indorser for value.