Viles v. Harris

Soule, J. The respondent Taft was liable as indorser on the notes which he had indorsed, and was entitled to hold his mortgage as security. The holders of the notes, not being the holders of security from the maker, were entitled to prove them against his estate, in insolvency, without first having recourse to the indorsers. Richardson v. City Bank, 11 Gray, 261. Meed v. Nelson, 9 Gray, 55. Agawam Bank v. Morris, 4 Cush. 99. The proof of the notes by the holders did not change the liability of the indorser to them. Only the making and receipt of a dividend would operate in his favor to diminish his liability. There was no estate from which to make a dividend, and he remained after the proof of the notes in precisely the same position as before, while the estate was not injuriously affected by the proof, because no part of it was absorbed by a dividend upon them. Under these circumstances, the holders of the notes having the [303] right to prove their notes, and the indorser being powerless to prevent such proof except by paying them, and the estate not having been injuriously affected by the proof, and the indorser not having reaped any unfair advantage over unsecured creditors of the insolvent, and there being no fraud on the part of the assignee in his conduct of the affairs of the estate, it would be manifestly inequitable to charge him in his account with upwards of eleven thousand dollars which he never actually received, and which he cannot be regarded, on any principle of law or equity, as having constructively received, or as having lost to the estate of which he has charge. The petition must therefore be Dismissed with costs.