Court Opinion

ID: 5513732
Source: CourtListenerOpinion
Date Created: 2022-01-10 04:26:38.202378+00
Date Added: 2024-06-11T08:34:14.024014
License: Public Domain

By the Court,

Nelson, J.
If the holder of a note "over due by a valid agreement with the maker, gives time for the payment, this is an interferance with the rights of the endorser by increasing his hazard, and as a just consequence, operates to discharge him. Mr. Chitty says, “The holder must not so agree to give time to the acceptor so as to preclude himself from suing him: and thereby suspend his remedy in prejudice of the drawer or endorser. ” Chitty on bills, 372. The above principle cannot be applied to the agreement in this case for the rights of the endorser are therein specifically reserved, no doubt from a knowledge of the rule. There was no time when, had the defendant taken up the note, he could not have had immediate recourse to the maker, and beyond this, his rights are not concerned.
It was earnestly contended that the defendant had in fact suffered loss by means of the delay by the plaintiffs ; admitting it to be so, a consequence that might happen without any agreement to delay, this affords no ground to exonerate the endorser from liability. He should have taken up the note at maturity, and then the collection of it from the maker would have been subject to his own discretion. It is giving time to the maker by an agreement binding in law, by which the holder is precluded from suing without regard to actual loss, that discharges the endorser,' and whether he sustained loss or not, is never a subject of legitimate examination. The judge, *291therefore, erred in advising the jury that the plaintiffs by the terms of the receipt had given time to the maker, and therefore discharged the defendant, within the meaning of the rule of law above noticed.
A question of satisfaction of the note was submitted to the jury, but it is unnecessary to be considered, as the error in the first point can be corrected only by a new trial. Whatever opinion the jury might entertain as to the question of satisfaction under the direction given to them they were bound to find for the defendant.
New trial granted.