Central N. Bank v. Dreydoppel

Opinion, Mr. Chief Justice Paxson : The promissory note in controversy was made by Jones & Eaton, payable to their own order as payees. ■ It was indorsed by William Dreydoppel, the defendant, and subsequently bjr the payees. This constituted what is known as an irregular indorsément; and the defendant claims that by reason thereof he is not liable to the plaintiff, who is the holder. The responsibility of such an indorser, however much it may have been doubted at one time, is now well understood. “ Nobody ever doubted,” said Justice Shakswood in Eilbert v. Finkbeiner, [503] 68 Pa. 247, “ that, when a man puts his name on the back of negotiable paper before the payee has indorsed it, he means to pledge, in some shape, his responsibility for the payment of it..... This court finally settled that in the absence of legal evidence of any different contract, he assumes the position of a second indorser; and that, to render his engagement binding as to any holder of the note, the implied condition that the payee shall indorse before him must be complied with, so as to give him recourse against such payee; ” citing Schafer v. F. & M. Bank, 59 Pa. 144. It will be seen that the reason of the rule, laid down in the line of cases of which those cited form a part, is that, unless the payee is the first indorser, there can be no recourse against him. In the case in hand the reason of the rule does not apply, because the payees are also the makers of the note; hence the defendant, although entitled to the position of second indorser, is deprived of no valuable rights, as he can sue the payees as makers of the note. Their responsibility to him is precisely the same as if they had indorsed the note as payees before he placed his indorsement upon it. We are of opinion that the defence set up in the affidavit is insufficient, and that the judgment was properly entered. Judgment affirmed.