Biddy v. People's Bank

Jenkins, P. J. The plaintiff bank, as payee, sued the maker and two accommodation indorsers or sureties upon a certain promissory note. The maker filed no defense. The sureties answered, admitting their execution of the instrument, but denying .liability, and pleaded that they had been discharged, [582] because the bank at or about the time of maturity of the note had/without their knowledge or consent, accepted a new note signed by the maker, but not signed by themselves, with a payment of interest in advance thereon, and thereupon the bank had marked “paid” and surrendered to the maker the old note; that this transaction constituted a novation for a consideration and an extension of the time of payment, and, by increasing the risk of the sureties, operated to discharge them; and that subsequently, when this new note fell due, the payee bank accepted a similar note in renewal or payment of the maturing note, without their knowledge or consent, and thereafter, when the last renewal note fell due, accepted still another note in lieu of the latter; all of which discharged them from liability upon the original note in suit. No other pleadings were filed by the plaintiff or the defendants. On the trial the plaintiff offered in evidence the note sued upon, as signed by the maker and the two-defendant sureties, with the entry across its face, “ Paid.” The defendant sureties objected to its introduction, upon the ground that it appeared upon its face to have been paid, and further because the- bank had accepted other and different notes in payment or renewal thereof. Thereupon, without objection or exception by the defendants, the court permitted the plaintiff to show, by oral testimony from the officers of the bank, all the facts and circumstances attending its acceptance of the new notes and as to those notes themselves. It was also shown that, upon discovery of the fraud of the maker in delivering the new notes with the names of the sureties forged thereon, the bank regained possession of the note sued upon, and took steps to collect it. From the evidence thus offered and the evidence of the defendants it appears, that, while the original note sued upon bore the genuine signatures of the defendant sureties as well as of the maker, each of the subsequent notes presented by the maker to the bank, on the faith of the apparent genuineness of the signatures on which he obtained their acceptance in lieu of the original paper, bore the forged signatures of the sureties; and that neither the bank nor such sureties had any knowledge of the forgery and fraud thus perpetrated upon the bank until about the time of maturity of the last forged note, whereupon, after the sureties ^ad called at the bank, it appeared by a comparison of their signatures that their names upon the renewal notes were forgeries. All parties concede the forgery. [583] With reference to the bank’s' opportunity to discover the forgeries, it appears that the sureties were not depositors or customers of the bank, and the bank was not familiar with their signatures; that it accepted from the maker, a brother-in-law of the sureties, both the note sued upon and the subsequent notes without question or a comparison of signatures. Upon the stand, one of the bank’s officials, comparing the true and false signatures, testified with reference to the signatures of one surety, “ I can see that the writing is not the same,” and that the forged signature of the other “resembles the one on this (the original) note more than” the signature of the other surety did, and that “ I am not familiar with their signatures, but they don’t resemble; everybody don’t usually sign their names exactly alike, but apparently they are not the same.” Another officer or employee of the bank testified: “ In my opinion they are forgeries. . . I don’t think the difference in the handwriting is very apparent,— think there is some resemblance between the two. There is some little difference in the ‘ N ’ in N. J. Biddy on the original note and the note the bank now holds; they are not exactly alike; the bank had admitted they are not the same; the writing may be a little different, but the letters are somewhat alike in the large size. They are forgeries. They deceived me at the time that I took them; I believed them to be genuine. . . I think it would take an expert to tell that these signatures were not the same. I am not an expert. I don’t think that I could have told that they were not the same signatures by looking at them. I generally just look to see if the name is on the back there, as usual.” A few weeks after discovery that the renewal notes contained forged signatures of the"sureties, the bank, having regained possession of the original note at some time not shown by the record, took steps for its collection and brought the instant suit thereon. After hearing parol evidence with reference to the original note and its alleged novation by the acceptance of the forged notes, the court admitted the note in question. The jury found for the plaintiff. The defendants except to the admission of the note and to various instructions of the court. It it not necessary to add anything further to the syllabus. Judgment affirmed. Stephens and Bell, JJ., concur.