Court Opinion

ID: 6599254
Source: CourtListenerOpinion
Date Created: 2022-07-20 20:06:16.059903+00
Date Added: 2024-06-11T15:57:57.537922
License: Public Domain

By the Court,

DixoN. C. J.
The condition of the bond is, that the defendant Alexander McClwrg was to indemnify and save the plaintiff harmless from all liabilities whiqjj. he might incur “ for the City Bank of Racine, by accepting their drafts, indorsing their notes, and the renewals thereof, or otherwise, to an amount not exceeding the sum of ten thousand dollars.” *649The language of the mortgage, as to acceptances and indorse-ments, is the very same,. to which is added, “ or in any other manner for the said bank.” Without standing, therefcfre, upon the question whether the notes, in the form executed, were in strictness the notes of the bank, or of Alexander McClurg, its president, we think it clear as to the three $2000 notes, that they are within the very letter of the obligation. They were drawn at the office of the bank, executed by Alexander Mc-Clurg, its president, indorsed by him “ for the City Bank of Racine,” and by William McConihe, cashier, transmitted to the plaintiff in pursuance of the bond of indemnity, indorsed and negotiated by him, and the money, the proceeds, actually received by the bank and appropriated to its use. Whatever form, then, the notes may have taken, whether that of the president individually, or of the bank, they were essentially transactions of the bank, and as such within the letter of the agreement to indemnify.
But should we be wrong in this conclusion, we are still -of opinion that the ground of estoppel put by the counsel for the plaintiff, furnishes an incontestable answer to this branch of the defense. Having drawn and forwarded the notes to the plaintiff as in pursuance of the agreement for indemnity, and as those for which the plaintiff was secured by the bond and mortgage, the defendant Alexander McClurg cannot now change his position, or be allowed to take refuge behind any alleged technical defect in the form of the notes.
But as to the $3000 note, we have arrived at a different conclusion. After a careful consideration of the evidence, we are of opinion that it is not one of those provided for, or intended so to be, by the bond of indemnity. It canno.t be contended that the plaintiff was at liberty, under the bond, to indorse any and all notes of the bank which might happen to be in circulation in the community where he resided, and make Me-Clurg responsible for their final payment. It was only such notes as came to him with the express or implied assent of *650McClurg that be was authorized to indorse. In other words, there must have been something either expressly or by implication amounting to a request on the part of McClurg, that the plaintiff should indorse the particular note, before McClurg can be charged under the bond. Or if this is not so, at least it must not appear that he indorsed it without the knowledge or approbation of McClurg. Such, we infer from the testimony, even that of the plaintiff himself, was the case as to the $3000 note. The plaintiff indemnified Isaac McConihe, Sen., and assumed its payment, without the knowledge or consent of McClurg. It was not made and sent to him as one of the notes covered by the bond; and his assumption of payment was purely voluntary, having no connection whatever with the bond. If he acted at the request of any one, it was at the request of Isaac McConihe, Sen., and not of McClurg. Under such circumstances, and by the course of dealing disclosed by the case, he cannot charge Me Clurg. In his own testimony, given upon the trial, he says as to the three $2000 notes, that they were received, indorsed and procured to be discounted by him, “ in pursuance of the arrangement with said defendant Alexander McClurg,’' and in this he is sustained by the other proofs in the case. But as to the $3000 note he says no such thing; and if he had, the statement would have been in direct conflict with the other evidence. The substance of his testimony upon this point is, that he assumed the payment by indemnifying Isaac McConihe, Sen., the indorser," and that when the note became due he paid it. If he had done so “ in pursuance of the arrangement” with McClurg, is it probable that, as a witness upon the stand, testifying in his own behalf, he would have omitted a fact so much and so obviously for his interest ? ' It seems to us not. Again, it appears from the letters of Isaac McConihe, Sen., given in evidence, that he indorsed the $3000 note and those for which it was given in renewal, in pursuance of an arrangement made between himself and the officers of the bank, and that that arrangement had no relation *651whatever to the bond of indemnity given to the plaintiff. "With these facts before ns, we cannot for a moment doubt that it was not in the power of the plaintiff, by indemnifying the indorser or voluntarily taking up the note, to shift the burden of its ultimate satisfaction upon McOlurg, under the bond. This note, therefore, should have been excluded in the computation of the amount due upon the bond and mortgage ; and, in order that the requisite modification may be made, the judgment must be reversed, and the cause remanded, directing the entry of judgment for the sum due for principal and interest upon the other notes.
As this modification reduces the plaintiff’s claim below the sum of $8000, for which the defendant James McOlurg, Jr., consented that the mortgage might remain as security, the question of the continuance of the lien as against him for a greater sum, or that fixed by the bond, is out of the case. The mortgage is clearly good against James McClurg, Jr., forthe sum to which he assented.
Judgment reversed, and cause remanded with directions as above stated.