Luther v. . Lemons

Connor, J. The evidence for the plaintiffs at the trial of these actions tended to show that the maturity of each of the notes sued on was extended from year to year, by the plaintiff in each action, as the holder of said note, at the request of the defendant J. W. Lemons, the maker, and therefore the principal debtor on each note, to 24 January, 1932. By reason of such extensions, the cause of action on each note did not accrue until 24 January, 1932. Both actions were begun on 31 October, 1934. Neither action is therefore barred by the three-year statute of limitations as against the defendant W. G. Smitherman, who at the time he endorsed both notes agreed to continue and remain bound for the payment of said notes, notwithstanding any extension of time granted to the principal debtor, and waived all notice of such extensions. In Bank v. Hessee, 207 N. C., 71, 175 S. E., 826, it is said: “Ordinarily, payments made by a principal will not deprive an endorser of the benefit of the defense of the bar of the statute of limitations. Houser v. Fayssoux, 168 N. C., 1, 83 S. E., 692; Franklin v. Franks, 205 N. C., 96, 170 S. E., 692. This principle, however, does not apply where the endorser has consented in the body of the instrument itself to such extensions; provided, of course, that such extensions are for a definite period of time. Revell v. Thrash, 132 N. C., 803, 44 S. E., 596.” See Miller v. Bumgarner, 209 N. C., 735, 184 S. E., 468. The discharge of the defendant J. "W. Lemons in the bankruptcy proceeding instituted by the petition filed by him did not affect the liability of the defendant W. G. Smitherman as an endorser on the notes sued on. Section 34 of the National Bankruptcy Act is as follows: “The liability of a person who is a codebtor with, or guarantor or in any manner a surety for, a bankrupt, shall not be altered by the discharge of such bankrupt.” For error in the peremptory instructions of the court on the 2d and 3d issues submitted to the jury, the plaintiffs are each entitled to a new trial. It is so ordered. New trial.