Court Opinion

ID: 7203061
Source: CourtListenerOpinion
Date Created: 2022-07-24 17:10:27.38034+00
Date Added: 2024-06-11T16:16:35.095845
License: Public Domain

MOUTON, J.
(dissenting). A. G. Ponson, now deceased, executed a promissory note, December 5, 1925, made payable to his own order. The note was not indorsed by Ponson, maker and payee, but was indorsed by Peter Mansur, Louis Prestenbach, and 'W. P. Sevario, in the order named.
The note was given for a debt which Ponson, the maker, had incurred in favor of Sevario for the purchase of some furniture, and was an accommodation paper.
The Commercial Securities Company, transferee of the note, obtained judgment against plaintiff, Louis Prestenbach; the other indorsers having refused to pay. Plaintiff paid the judgment so obtained by the Commercial Securities Company, and was by that company conventionally subrogated to its rights thereunder.
Plaintiff, whose name is the 'second on the note, sues Peter Mansur, whose name appears thereon as the first indorser. The suit is between these two indorsers; Sevario not being a litigant in the case.
Judgment was rendered against Peter Mansur, from which he prosecutes this appeal.
The first contention of the defendant is that the note, not having been indorsed by Ponson, the maker, was not a complete negotiable instrument, and that defendant incurred no liability thereunder.
It was held in Maddox v. Robbert, 165 La. 694, 699, 115 So. 905, that a note payable to order may be transferred without indorsement, and that the transfer may be proved by parol; also by this court in *431Crowley Lumber Co. v. Plaffer, 4 La. App. 606.
It was also so held in Pineland Realty Co. v. Clements, 149 La. 274, 88 So. 818, 819, where it appeared that the note had been made payable to the order. of the maker and had not been indorsed. In that case it appeared from the allegations of the petition, which had to be taken as true on an exception of no cause of action, that value had been given in return for the note, and in which the court said:
“The fact that the maker, as payee, had failed to indorse it would be no defense against a suit thereon, for the law will sometimes presume that to have been done which should have been done.”
Under the facts hereinabove stated the note is legally enforceable, Corpus Juris vol. 8, p. 1007; Unterharnscheidt v. Missouri State Life Ins. Co., 160 Iowa 223, 138 N. W. 459, 45 L. R. A. (N. S.) 743, and defendant is liable thereon, unless he can escape liability under his second defense, which is, that he was not a prior indorser on the note.
The proof shows that plaintiff’s name was the first placed o.n the note by Ponson, his son-in-law, who was acting as his agent. It further shows that defendant, Peter Mansur, was a subsequent indorser, and who claims that he inadvertently signed as first indorser as appears in the order of the signatures on the back of the note. Claiming he was the second indorser in point of time, he contends that he is not liable to plaintiff, who was, in point of time, the first indorser.
Pertinent to the. issue herein presented, section 68 of Act No. 64 of 1904, .p. 147, reads as follows:-
“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.”
The legal liability of the indorsers on the note was, under the law merchant, fixed by the order of their signatures which constituted their written contract.
In the case of Connely v. Bowig, reported in 16 La. Ann. 108, 79 Am. Dec. 568, the court said that it requires strong evidence to vary the legal liability of indorsers as fixed by the lex mercatoria, because such a modification of their obligations is in derogation of the law of their written contract. In that case the court said that there was no express agreement to show that the indorsers were to bear jointly any part of the loss resulting from their indorsement of the note for the accommodation of the maker.
In a still earlier case, Knox v. Widow and Heirs of Dixon, 4 La. 466, 23 Am. Dec. 488, practically the same doctrine was applied in a case involving similar issues.
These decisions were rendered long before our present Negotiable Instrument Law was enacted in 1904. In that act, section 68, above referred to, says that the prima facie liability of the indorsers springs from their written contract of indorsement in the order in which they indorse. This obligation is created according to the order in which they indorse. The obligation may, however, be varied or modified, says that section of the statute, if it be shown that as between or among themselves the indorsers have agreed otherwise. Such an agreement, in our opinion, must be shown to establish a modification of the contract resulting from *432the order in which they have indorsed. This doctrine is recognized in most of the other states where the law merchant prevails as it does in this state. See Corpus Juris, vol. 8, par. 455, pp. 290-380. Randolph on Commercial Papers (2d Ed.) vol. 2, sec. 740, says:
“The liability of endorsers of commercial paper is in the order in which their names appear on the paper. Even among themselves successive accommodation endorsers are liable to one another in the order in which their names appear in the absence of special agreement to the contrary. Only an express agreement can render them liable to one another as co-sureties with the consequent right and duty of contribution as such.”
The proof in this case shows that (plaintiff did not know either Mansur, the defendant, or Sevario, the other indorser. The name of the plaintiff was written on the note by Ponson, and the record shows that plaintiff was not present when the two other indorsers signed. There is no proof, and it is not contended by defendant, that the indorsers entered into any agreement that they would be bound otherwise than in the order “m which they endorsed” the note. In the absence of such an agreement, there resulted no variation or modification in the obligations of the indorsers to respond in accordance with the order in which their names appeared on the obligation.
I therefore respectfully dissent.