M'Broom v. Governor

GOLDTHWAITE, J. This action is debt — instituted in the Circuit court of Madison, on a sheriff’s bond, signed by William McBroom, as principal, and the plaintiffs in error, as his sureties. The breach assigned, is the non-payment of money, collected on a venditioni exponas. The defendants pleaded four several pleas — the two first of which are substantially the same; and shew the death of William McBroom, in January, one thousand eight hundred,and twenty-eight — administration on his estate in May, one thousand eight hundred and twenty-eight, and publication thereof as re — 41 — quired by law; and that the claim was not preséntéef to Me Broom’s administrators, within eighteen months after the grant of administration, or within eighteen months after the cause of action accrued. To these pleas there was a demurrer, which was sustained by the Circuit court. The third plea — conditions per-formed; and the fourth, the statute of limitations: on these, replications and issues to the country; on which a trial was had, and a verdict found in favor the plain-tiff. * At the trial, no evidence being offered by the plaintiff, to shew any demand of the money collected, the court was requested to instruct the jury, that no action could be maintained, without shewing a demand— which request was refused, and the defendants excepted. To reverse the judgment rendered against them, the plaintiffs in error have brought the case into this court; and assign, that the Circuit court erred, in sustaining the demurrer to the two pleas, and in re-* fusing to give the instructions by them requested. It is insisted, that all claims against the estate of any deceased person, not presented to the executor or administrator within eighteen months after the cause of action has accrued, or within the same pei’iod after the grant of letters testamentary, or of administration, are extinguished, and forever barred, under the statute of non-claim ;* and hence it is inferred, that as this demand was extinguished as to McBroom’s estate, it can not be enforced against the plaintiffs, who are sureties. The statute was certainly intended to present a complete bar, under which the executor or administrator might rest, with security, and proceed to distribute the estate, according to the directions of the will,,or under the statue of distribution, and the ,cre — 42 — ditor, or any other person interested in the distribuí tion, would have an equal right with the executor or administrator, to insist on the exclusion of all demands, not presented within the period limited. So far, then, a@- the statute referred to, has a bearing on this case, it may be considered as enacting a com- - píete bar; and if the creditor was now seeking his remedy against the estate, a similar plea to those pleaded in this case, would interpose a complete de-fence. Such has been the construction given to similar statutes, in other States.* Admitting this, as the true construction, which must be given to our statute of non-claim, we will proceed to examine whether the consequences flow from this construction, which have been insisted on, by the plaintiffs in error. The general rule, without doubt, is, that the extinction of the liability of the principal debtor, is also, the extinction of the liability of the surety ; but an exception obtains, when this extinction is caused by operation of law. The same rule attaches to all cases of joint contracts. The extinction of the contract, as to one of several joint contractors, is an extinction as to all, but the same exception must prevail. In the case under consideration no act is alleged to have been done by the creditor, which has affected the subject matter of the contract, or which has changed the situation of the parties. He is charged, alone, with having been passive, and with an act of omission,—by reason of which, it is said, his right is extinguished, as to all of the co-obligors. We look-in vain to the terms of the contract, for a sanction to this argument,—and if supported at all, it must be from the analogies of the law. It is said, that the surety has the right to indemni — 43 — ty against his principal, for any injury which he may sustain, from the contract of suretyship, and that the remedy is gone, by the remissness of the creditor. If this be so, it must arise from one of two causes : either that the surety, when he pays money on the contract, has no remedy against the estate of his principal, or because that estaté is not able to indemnify him. If these sureties should now pay this bond, their right or cause of action against the estate of their principal, could not be said to have accrued previous to the payment — until then, it was not a debt due from the estate to them- ' The contract of Mc-13 room, by this bond, is of a two-fold character.— With the creditor he engages to perform the duties of his office, and with his sureties, by implication, that he will indemnify them, against any loss which they may sustain on his account. Both engagements are equally obligatory, but they can not accrue at the same period — and that of the surety, not until the time arrives when he shall have paid money, for his liability to the creditor. From this moment his cause of action accrues, and he has eighteen months within which to enforce it against the estate of his debt- or, and it is within the very terms of the statute. If, in consequence of the delay of the creditor to pursue his remedy against the estate of the principal clebtor, a loss has accrued, it is not perceived how this circumstance, of itself, should destroy the. obligation of the surety, any more than in any other case, where loss is the consequence of the delay of the creditor. No case has, or, as it is believed, can, be shewn, in which it has been held, that mere passiveness will discharge the surety. There is no legal obligation tobe active, except at the request of the surety, (Eyer vs Everett*) and the — 44 — circumstance that the surety can not, in cases of a su-retyship of this nature, know when a default has taken place, ought not to place the creditor in a worse situation, than if the contract was absolute, and so definite, that the surety could,'at any time, call on the principal to proceed. The law gives to the creditor the right of security; and it was for the surety to consider the uncertain nature of his responsibilities, when he entered into the engagement.- He can not now, be permitted to say that he ought to occupy a more favorable position, than he would have done, if his liability was of a, more direct and certain nature. It is supposed that the bankrupt and insolvent laws of Great Britain, must present questions analogous to the one which arises in this case, in as much as these laws provide for the extinction of the debt due from ■the bankrupt or insolvent debtor. Accordingly, we find, on reference to. many cases, the very principles maintained, which we have declared. Soutten vs Soutten;* Goddard vs Vanderheyden;† Hewes vs Mott;‡ Newington vs Keyes;§ Wood vs Dodgson;ǁ Moody vs King;¶ Dally vs Wolferston.** It seems to be admitted, by the argument, that this discharge of the surety, springs out of the statute of non-claim, if at all, and did not exist at common law; and yet, by the common law, in case of a partial insolvency, the omission of the creditor to proceed against the estate of the principal debtor, would have ■worked an entire loss to the sureties, as the whole estate might have been exhausted on other liabilities; and when the surety came to enforce his claim, he might be met with the plea, of fully administered.— The case of Cope vs Smith,†† is conclusive to shew, — 45 — that an omission to sue, would be no defence at common law, or under .the statute of Pennsylvania, which does not extinguish the demand, but merely postpones the creditor not presenting his demand. The case of The Nashville Bank vs Campbell et al,* is only distinguishable from this case, by being founded on a direct liability to pay money; and the Supreme court of Tennessee held a similar, plea to be no answer to the declaration. But the principle does not rest on authority alone— it is supported by the ¡plainest principles of equity.— If the estate of McBroom, the principal debtor, was either wholly or partially insolvent, it could neither be just or equitable, that the creditor should lose the whole of his demand, when, under no circumstances, could he have recovered it from the estate of the deceased debtor. In such a case, to sustain the pleas, would operate as the infliction of a penalty, — and a reward would be given to the sureties, for the omission of the creditor, to prosecute his claim. Even in cases where a creditor has two funds, to which he might have resorted, to secure his debt, one of which could not have been reached by the debtor, or by his surety, and this one has been lost, by the wilful omission of the creditor to proceed against it; yet these circumstances do not constitute a de-fence at law. Thus, in the case of Folliot vs Ogden,† the facts were, that the defendant had been attainted by the State of N. Jersey, his estate and effects confiscated, and vested in the people of that State, and, in the first place made liable for his debts, and out of which was raised a fund more than sufficient to pay them— to which fund, the plaintiff, who was a citizen of New Jersey, might and ought to have resorted. It was — 46 — held, by Lord Loughborough, and the court of Common Pleas, that the only relief of the defendant was in Equity. If it is within the power of the plaintiffs in error to shew, .that the creditor in this case, might and ought to have resorted, in the first instance, to the fund created by the deceased debtor’s estate; and that, by reason of his culpable omission so to do, a loss will be sustained by thpm, if payment is enforced against them, on. the bond, — they might, perhaps, have relief in a court of equity, to the extent of the injury, according to the principles laid down in the case of Wright vs Nutt.* This case, in the facts, is similar to the case of Folliot vs Ogden, but in the court of Chancery, which sustained a bill for relief, after judgment in a court of law, on the ground that the creditor could, and the debtor could not, have resorted to the particular fund. How far the principles established by these cases, may entitle the plaintiffs in error to relief, on a proper case, is a question which need not now be examined. r ' Our conclusion is, that the pleas pleaded, present no legal defence to this action; and if the declaration was sufficient in law, there would have been no error in sustaining the demurrer to them. But, on looking into the declaration, we are satisfied that it also is vicious. There is no allegation, that the money collected by McBroom was ever demanded from him, or from his administrators, before the institution of this suit. This Court has already decided, (Barton vs Peck,†) in the case of a motion against a sheriff and his sureties, that such an averment is essential, — und we consider it equally so, in this case. The sheriff is the agent, appointed by law, to collect the money on executions ; but he is not bound to — 47 — search out the plaintiff, and tender to him the money collected. Neither is he required by law, to pay it into court. He holds it under a lawful authority, until a demand or request is made by one entitled to receive it. We are aware that the English rule is at variance with the views as now expressed.—Dale vs. Burch;* Swain vs Morland;† Jefferies vs Sheppard.‡— But in the case of Wilder vs Bailey;§ the rule adopted by this court, is laid down with reference to a statute similar to our own. •, ■ The general rule, in relation to all agents who collect money under a lawful authority, is, that until a demand or request made, they are not liable to a suit. Bee Armstrong vs Smith;ǁ Judah vs Dyott;¶ Topham vs Braddoch;** Taylor vs Bates;†† Rathbone v Ingalls;‡‡ Williams vs Storrs.§§ These views shew that the exception taken before the jury, for the want of evidence of demand, was unnecessary; and as no averment was made, it was unnecessary to prove the fact: but, as the averment was omitted, in the declaration, the demurrer to the pleas should have been overruled, and the declaration pronounced bad. The judgment rendered, must be reversed, and the cause remanded; and the pleadings may be amended in the court below. Footnotes [*] Aikin’s Digest, 153. [*] 6 Conn. Rep.28 ; 15 Mass. Rep. 6: 16 ib. 179; 3 New H. Rep. 491; 13 Mass. Rep. 201; § Piek. 140. [*] 2 Russ. 381. [*] 1 D. & R. 521: 5 B. & A. 852. [†] 3 Wilson, 262. [‡] 6 Taunt. 329. [§] 4 B. & A. 493. [ǁ] 2 M. & S. 195. [¶] 4 D. & R. 30.—2 B. & C. 558. [**] 3 Ib. 269, [††] 8 Serg. & Raul. 110. [*] MS. 7 Yerger. [†] 1 Hen. Black. 123. [*] 1 Hen. Black. 136. [†] 1 Stewart & Porter, 486. [*] 3 Camp. 347. [†] 1 B. & B. 370. [‡] 3 B. & A. 696. [§] 3 Mass. 294. [ǁ] 3 Black. In. Rep. 251. [¶] 3 Black. In. Rep. 324. [**] 1 Taunt. 572. [††] 5 Cowen. 376. [‡‡] 7 Wend. 320 [§§] 6 Johns. Ch. Rep. 353.