Court Opinion

ID: 7160442
Source: CourtListenerOpinion
Date Created: 2022-07-24 16:15:51.553899+00
Date Added: 2024-06-11T16:15:21.330130
License: Public Domain

Morphy, J.,

delivered the opinion of the court.
On the 22d of February, 1837, Grant purchased of the late Dr. M'Mahan (whose estate is now represented by plaintiff) a lot of ground for fifteen thousand dollars. In the deed of sale he agreed to assume the payment of a note, of three thousand five hundred dollars yet due by M'Mahan, to his own vendor William M'Cawley, and bearing mortgage *481on the property. For the residue of the stipulated price, he made and delivered his own notes to the order of and endorsed by Turnell his co-defendant, one of two thousand dollars payable thirty days after the sale, and two others of four thousanu seven hundred and fifty dollars each, payable at one and two years from the same date; all these notes were secured by mortgage on the premises purchased. Grant took up at maturity his note of two thousand dollars, but having failed to pay any of the others, the plaintiff sued out an order of seizure and sale. The property was ordered to be sold according to the terms of the original contract, to wit: That the purchaser should assume the payment of the note of three thousand five hundred dollars with interest, and should pay, at their respective maturities, the other two notes of four thousand seven hundred and fifty dollars, so far as the price of the adjudication should go. The property brought only eight thousand dollars, and the object of this suit is to recover the balance of the price yet due to the plaintiff. The second note, of four thousand seven hundred and fifty dollars, became due shortly after the sheriff’s sale, and appears not to have been protested.
After deducting the costs, the judge below applied the proceeds of the sale equally to the payment of the assumed note of three thousand five hundred dollars, and the first note of four thousand seven hundred and fifty dollars under protest, and gave judgment against Grant for the whole balance unpaid. As to Turnell, he was decreed to pay four hundred and sixty-two dollars ahd twenty-five cents, the balance thus found to remain due’on the first note endorsed by him, but he was entirely released from all liability on the second note, on the ground that it had not been duly protested.
From this judgment the plaintiff has appealed. She urges that it is erroneous so far as relates to Turnell:
1. In discharging him from the payment of the second note of four thousand seven hundred and fifty dollars.
A proposition made by an endorserbeforethe note became and t0 provide means for its payment, which were not does71 not0ldispense with protest and due notice to the endorser.
Pending tiations with an endorser before maturity of the or may notripen ment ^nnoMjé considered as a waiver of protest and notice.
2. In applying proportionally the proceeds of the adjudica¿{on pay assumed note of three thousand five hundred dollars, and that of four thousand seven hundred and fifty dollars.
I. It is contended on the part of the appellant, that although the second note has not been protested, yet under the peculiar circumstances of this case, Turnell should be held responsible for its amount; that about the time of the maturity of this note, he had, as it were, made the debt his own, and by his acts and whole course of conduct had induced plaintiff to consider the protest of the note as unnecessary. We think the judge acted correctly in releasing this endorser. The record shows that a few days after the sheriff’s sale some negotiations, took place between the plaintiff’s agent and Turnell. The latter appeared anxious to have the benefit of the adjudication made to plaintiff at eight thousand dollars, in order to save himself from too heavy a loss; being unable to procure the cash required by plaintiff, he had offer- * . . , ed to transfer certain notes and bank stocks in lieu or cash, and time was to be allowed him to pay the balance due ; this proposition had not been accepted, nor had any other arrangement been made, or understanding had in ^e matter when this note fell due. Nothing could have induced the plaintiff or her agent to believe that Turnell had waived his rights as endorser, and that it bad become unnecessary to protest the note. It is more reasonable to infer, from all the circumstances, that this note having been filed with the others in the suit for the seizure of the property, maturity was overlooked by plaintiff’s agent. In fact, one 0f thenQ st,ates positively, that had the note been in his t r J . possession, he would have caused it to be protested. Pending negotiations with an endorser before maturity, which may or rnay not fipen into an agreement, cannot be considered as a waiver of the formalities necessary to fix his respon- ..... Slblllty. ,
II. As to the imputation of the proceeds of the sheriff’s sale, it is clear that the assumed note of three thousand five hundred dollars bore the first mortgage on the property sold, *483and was to be paid in full, in preference to the other notes ; when Turnell endorsed them, he must have expected, in case he took them up, to be subrogated to the mortgage of M'Mahan, Grant’s vendor, in the situation in which it stood in reference to that of M‘Mahan’s own vendor, of a previous date, yet unsatisfied. The very terms of the adjudication indicate how the imputation was to be made ; had a stranger, instead of plaintiff, become purchaser at the sheriff’s sale, he would have retained in his hands the full amount of the note assumed, and would have paid over to the sheriff the balance, to be apportioned between the two other notes, had they been held by different persons. Under this view of the subject, and on making the imputation in accordance therewith, we find that John A. Turnell, should have been decreed to pay as endorser of the first note, eight hundred and three dollars and one cent, instead of four hundred and sixty-two dollars and twenty-five cents.
An assumed notebyavendee, bearing the first mortgage, must be paid in full, before those he gives can come in under his mortgage.
The judgment of the court below, as rendered against Turnell, is, therefore, reversed ; and it is ordered and adjudged, that the plaintiff do recover of the said Turnell, éight hundred and three dollars and one cent, with legal interest from the 28th January, 1839, until paid, with costs in both courts.