Court Opinion

ID: 6547087
Source: CourtListenerOpinion
Date Created: 2022-07-19 22:20:27.694437+00
Date Added: 2024-06-11T15:55:59.840915
License: Public Domain

McCueloch, J. This is an action instituted by appellee on three negotiable promissory notes executed to him by appellant, as one of the joint makers with W. T. Tucker and T. H. Davis. Appellant and Davis signed the notes as joint makers, but were in fact only accommodation sureties for Tucker, which fact was known to appellee when he accepted the notes. Tucker was indebted to appellee for a sum of money collected as attorney for the latter, and appellee testified that the notes were delivered to him in satisfaction of the debt. Tucker admitted that he was indebted to appellee for money collected as the latter’s attorney, but denied that the notes were delivered in satisfaction of this debt. He testified that he delivered the notes to appellee for the latter to use as collateral in borrowing money, and that he represented to appellant, when he requested him to sign as surety, that the notes were to be used only for that purpose. Appellant also testified that he signed the notes upon said representations made to him by Tucker that the same were for appellee’s use as collateral in borrowing money. Appellee' did not negotiate the notes, but kept them until maturity, and afterwards instituted this action on them. There is no dispute in the evidence as to these representations being made by Tucker to appellant to induce him to sigh the notes; and, as the verdict of the jury has settled in appellee’s favor the conflict between his testimony and Tucker’s as to the purpose for which thé notes were delivered, we must treat it as settled that the notes were put into circulation by Tucker for a purpose not in accordance with his representations to appellant when he obtained the latter’s signature. Appellant, then, has made out a defense except as against a bona Ude holder of the notes for value. Can appellee, who accepted the notes in payment of an antecedent indebtedness from Tucker, the principal, claim as an innocent holder for value? This court has answered that question in the affirmative. Tabor v. Merchants’ National Bank, 48 Ark. 454. In that case the court held that “one who takes negotiable paper in payment of an antecedent debt before maturity and without notice, actual or otherwise, of any defect thereto, receives it in due course of business, and becomes, within the meaning of commercial law, a holder for value.” The fact that appellee knew when he received the notes that appellant was an accommodation surety does not' affect his right to recover. Evans v. Speer Hardware Co., 65 Ark. 204. The instructions given by the - court at the instance of appellant were more favorable to him than he was entitled 'to, but of this he cannot complain. The evidence justified the verdict of the jury, and the judgment is affirmed.