Court Opinion

ID: 6543597
Source: CourtListenerOpinion
Date Created: 2022-07-19 22:17:47.553778+00
Date Added: 2024-06-11T15:55:54.189502
License: Public Domain

Riddick, J., (after stating the facts). We are of opinion that the judgment of the circuit court is right, and it must be affirmed. Appellant, Maledon, with other parties, stockholders in the Port Smith Rvaporating Company, executed a promissory note to Leflore for money loaned by him to said company. This note, under our statute, was in effect a joint and several obligation, and plaintiff had the right to sue one or all the makers thereof. Sand. & H. Dig., secs. 4186 and 5634. Appellant states that he signed the note under the belief that it was. necessary for him and the other directors to sign the same in order to bind the company, and that he did not expect to bind himself individually. His name appears signed to the note as one of the obligors for the payment of the amount named therein. Upon the faith of this obligation, Leflore parted with his money for the use of a corporation of which appellant was a stockholder and director. Appellant does not pretend that he was misled or induced by Leflore to sign said note, and the fact that he was mistaken concerning the legal effect of signing the note is of no avail against the action in this case. A written contract cannot be varied or affected in that way. Ritchie v. Frazer, 50 Ark. 393. Leflore did not have possession of the mortgaged property, and the contention that appellant is discharged by the failure of Leflore to foreclose his mortgage, and by other laches, cannot be sustained on the facts of this case, for, at most, he is guilty of only the passive conduct of not suing. Grisard v. Hinson, 50 Ark. 230. Appellant, as one of the obligors in the note, had the right to pay the note and foreclose the mortgage for his own benefit, and he cannot complain because Leflore elected to proceed against him without resorting to the mortgage. Grisard v. Hinson, supra. Inability of surety on note. The fact that Clendening, the president of the Evaporating Company, was a .member of the firm of attorneys employed by Leflore to collect his debt did not make Leflore responsible for the oflficial conduct of said Clendening in the management of the property of said company. When counsel for appellant offered to show that Clendening had mismanaged and wasted the property of said company, they were asked by the circuit judge whether they intended to connect Leflore with such mismanagement, or to show that Clendening had possession of the property as his agent, to which inquiry counsel responded, “No.” As they did not propose to show that Leflore was in any way responsible for the management of the property of the Evaporating Company, by its president, the conduct of the president in that regard was a matter entirely outside of the case, and the evidence was properly excluded. It is also contended that the court erred in refusing to allow appellant to show that the board of directors of the company had never authorized the president to borrow the money for which the note was executed, but this contention cannot be sustained. In the first place, there is no such allegation in the answer; bu¿t, if such a defense had been made, it would not have been tenable, for the reason that a surety is, as a general rule, liable on a note executed by him as such, although his principal has no capacity or authority to make such contract. The rule has been frequently applied in cases where the principal was an infant or married woman, and we see mo reason why it should not apply where the note is executed by a corporate principal, without proper authority. Gardner v. Barnett, 36 Ark. 479; Davis v. Statts, 43 Ind. 103; Taylor v. Dansby, 42 Mich. 82; 2 Randolph’s Commercial Paper, sec. 915, and cases cited. There were other objections to rulings of the trial court urged by counsel, but our conclusion is that the evidence did not show any defense to the action of plaintiff, either at law or equity, or any disputed fact to be considered by a jury, and the court properly directed a verdict for plaintiff. The judgment is affirmed.