Waterbury a. Sinclair. result of this case, with the other authorities, is, that it is not necessary to turn an indorsement into a guaranty or a joint 'promise, in order to save the contract from total failure, in any case except where the note is not negotiable. When this case of Hall a. Newcomb went to the Court of Errors (7 Hill, 416), the judgment of the Supreme Court was affirmed by a majority vote, after two arguments. This established the principle that such an indorsement can be made available to the payee as such, and so as to hold the party making it as an indorser for the benefit of the payee; and, therefore, the holder of such a note, whether payee or indorsee, will not be allowed to treat a party who has made such an indorsement otherwise than as an indorser. Chancellor Walworth delivering the leading opinion, sanctions the reasoning and conclusions of the Supreme Court, and proceeds to show how such an indorsement can be made available to the payee of the note. And although his views upon this point were characterized by Senator Bockee as recommending a "finesse and shuffling game, unworthy the dignity of the law," that remark was made in a dissenting opinion, in which the learned senator endeavored to restore the old rule, by which the defendant could be treated as a guarantor or joint maker. His argument was, that to render the defendant liable as an indorser, required a sort of finesse which the law would not resort to; and therefore, under the rule that the contract and the design of the parties should not be permitted wholly to fail, and by the maxim ut res magis valeat quam pereat, the courts must make out a contract of guaranty or joint undertaking. Whether his reasoning is sound or not, it is not for me to say; it is sufficient that it was overruled, and the contrary doctrine established. It may be added, that in making this decision, the majority of the court not only adopted the conclusion, but the views of the chancellor. Senators Barlow and Wright, who were the only other members of the court who delivered opinions, concurred in the view taken of the case by the chancellor, as well as in the result of his argument. The late case of Spies a. Gilmore, in the Court of Appeals (1 Comst., 321), was similar in its circumstances to Hall a. Newcomb. The judgment of the Supreme Court was affirmed, on the ground that the defendant could not be made liable as guarantor or maker. Waterbury a. Sinclair. I agree that the case sustains the doctrine that he could be made liable as indorser; for, under the principles which run through the cases to which I have just adverted, and which are expressly approved by Judges Bronson and Jewett in this case, if the defendant could not with proper diligence have been charged as an indorser, the court was bound to treat him as a joint maker. The opinions of the Court of Appeals do not, however, afford us any light upon the question, in what manner or upon what theory this is to be done. After much consideration of the question, and of the able and ingenious reasoning of my learned associate, in the court below, as well as of the well-considered opinion of Judge Roosevelt in Moore a. Cross, above referred to, I am unable to agree with their view of the defendant's liability. It is true, of course, that the engagement of an indorser (and it must be remembered that we are not to hold the defendant as an indorser of commercial paper strictly), is to pay the note to any subsequent holder, if it is duly presented to and payment refused by the maker, and due notice given to the indorser. But this liability is only to a subsequent holder, and the question is, How or in what manner, under what circumstances, the payee of a note can become or be a subsequent holder to a party whose name is not in the note at all? We must make this out by the note itself, for we are refused the aid of parol evidence; or at most we can only resort to it to prove the consideration and authority for the written contract of indorsement which is to be supplied above the defendant's name. It strikes me, that neither the payee nor any one else can be such a subsequent holder, unless he has received the note from the indorser. He must be a party to whom that indorser, or some one deriving title through him, has transferred it, because if the note has not been properly transferred to him he is not a holder at all; and if it has not been transferred by the agency of the party to be charged, the holder cannot be subsequent to that party. I do not understand an indorsement as any thing else than a contract of transfer. If the note is not negotiable-that is, transferable-writing a man's name across the back of it for any purpose, whatever it may be, is not legally an indorsement. When it is said that the contract of an indorser is equivalent to drawing a bill of exchange on the maker, it means a bill of Waterbury a. Sinclair. exchange, referring to the terms of the note indorsed. There cannot be a bill of exchange made upon the back of a note, unless the maker upon the face of it has promised, either directly or indirectly through prior indorsers, to pay the note to this indorser, who thus orders him to pay it to some one else. Until the payee has made his bill of exchange, or drawn his order upon the maker whose promise to him lies at the foundation of the matter, no one else can make such a draft or bill— at least not effectually. The opinion in the court below admits, as I understand it, that if this note had been transferred to a third party, there could be no recovery upon it; and there would be no valid contract by the defendant unless the plaintiff had first indorsed it. I am unable to see how the indorsement of the defendant can be valid for the plaintiff, and nugatory as to any subsequent claimant at the same time; or how her engagement is one thing to the plaintiff, and something else to all others, while it is still strictly an indorsement to all;especially when the plaintiff can only recover by placing himself in the position of such a holder or indorser. If we were at liberty to allow the plaintiff in his peculiar position to treat her as a maker or guarantor, the reasoning would be well enough. But we have no such right. The long and short of the matter is, that the plaintiff here claims that the defendant, Ann Sinclair, has indorsed to him a note, which; upon the statements in his pleadings, she never could have indorsed, because she never was either payee or indorsee, so as to enable her to indorse again to any subsequent party. It will be remembered that we are not inquiring what the plaintiff might do or had a right to do, but what he alleges that he has done. Under the Code, the title of a plaintiff to a note must be set out, and all the facts alleged which are necessary to a recovery. I think the only way in which the present plaintiff could make such a note as this available, would be by indorsing it to the defendant without recourse, and then taking the defendant's indorsement as the source of his title, as well as the foundation of his rights. The proof of the extrinsic facts stated in the complaint, will be necessary to justify this apparent transposition of the parties to the note, but it will justify it, and, therefore, these facts are properly alleged. But the complaint is defective in not stating such a transfer. Black a. Foster. It does not show the defendant to have indorsed the note at all in a legal sense, and the plaintiff must get an indorsement, and not rely on paro, proof of a contract, or he cannot recover under the present doctrines of the courts. The process by which this is to be accomplished may be called a manoeuvre, but it is a necessary one, and therefore it must be performed, and then alleged and proved. I am compelled to the conclusion that this complaint is defective, and that the order of the special term should be reversed with costs, and judgment ordered for the defendant on the demurrer, with leave to the plaintiff to amend on the usual terms. BLACK a. FOSTER. Supreme Court, First District; General Term, November, 1858 EXCEPTION.-EVIDENCE-CLAIM AND DELIVERY. An exception to evidence relevant as to one of two co-defendants, but irrelevant as to the other, must be stated as being taken by the defendant, as to whom it is irrelevant. If stated generally as taken by the defendants, it is not error to overrule it. In an action for chattels, the plaintiff took proceedings of claim and delivery, and the sheriff seized the property. The defendant appealed, and put in an answer which contained, among other things, a denial that he had detained the property. At about the same time he executed and delivered to the sheriff the undertaking allowed by section 211 of the Code, to obtain a return of the property, which was accordingly returned to him. Held, that the undertaking was admissible on the trial, as evidence to go to the jury in disproof of the defendant's denial that he had detained the property. Appeal from a judgment. This was an action for chattels. It appeared that the plaintiff sold to the defendant, W. M. Foster, in August, 1854, a quantity of lumber, on the terms cash for freight, and his note for four months for the amount of the bill of lumber. The lumber was placed on a wharf in this city and measured, and the bill presented at defendant (W. M. Foster's) office; and the terms of Black a. Foster. the sale not being complied with, the property was demanded of him, and he refused to deliver it, stating that he had made an assignment, and had put every dollar in it. To a threat to take the property away, he replied that it could not be taken away, as it was put into his assignment. This was on the 28th of August. The assignment was dated and executed on the 11th of September, 1854, and was made by Wm. M. Foster to the other defendant, and another person, and was signed by both defendants, and its execution acknowledged on the same day. The property was taken by the sheriff, and the defendants claimed a redelivery to them, and caused an undertaking to be executed according to the Code, which stated that they required a return to them of the property taken. This undertaking was executed and acknowledged about the time the defendants' answer was put in. The jury found a verdict for the plaintiff, and a judgment was thereupon entered; and from such judgment this appeal was now taken. M. Cornwall, for the defendants and appellants. D. D. Lord, for the respondent. BY THE COURT.*-DAVIES, P. J.-Several exceptions were taken to the rulings of the justice at the circuit, and which, if erroneous, will entitle the defendants to a new trial. The first exception taken is to the admission of the declaration of Wm. M. Foster, when called upon to comply with the terms of the sale. This testimony was objected to by the defendants, and not by the defendant D. C. Foster as irrelevant as to him. It was clearly competent as to Wm. M. Foster, and if the defendant D. C. Foster wished to object to it as incompetent as to him, he should have so stated the ground of his objection. It was not incompetent, irrelevant, or improper as to the defendant Wm. M. Foster, and therefore properly admitted. The next exception was to the admission of the assignment executed by both defendants. We are unable to see any error * Present, DAVIES, P. J., SUTHERLAND and HOGEBOOM, JJ. |