Court Opinion

ID: 8004184
Source: CourtListenerOpinion
Date Created: 2022-09-09 01:51:52.142146+00
Date Added: 2024-06-11T16:35:49.199211
License: Public Domain

Separate opinion of
Judge Napton.
I do not concur in this opinion, though there is authority tending to support the conclusion reached. If the payee has knowledge of the arrangement for other sureties, or if there are other circumstances connected with the execution of the note to put him on inquiry, the rule announced may be'correct, and I think is; but where there is nothing on the face of the paper indicating that other sureties were expected to become parties to the instrument, and no fact brought to the knowledge of the payee or obligee, before he accepts the instrument, calculated to put him on his guard in respect to that point, and which would naturally have led a prudent man, interested in the opposite direction, to make the inquiry before accepting the security, the fault cannot be said to rest to any extent on the obligee or payee. (Ins. Co. vs. Brooks, 12 Am. Law Reg., 399.) And therefore the surety must run the risk of the fraud of his own agent. Most of the eases cited are upon official bonds, or bonds for the payment of money, and the doctrine of special agency is relied on to make such conditional delivery by the surety to his principal, as merely making the deed an escrow ; but this doctrine would manifestly apply as well to negotiable paper, and it has never been pretended, that negotiable paper is subject to such hidden defenses. I concur in affirming the judgment.
Judge Sherwood concurs with me.