Terrell v. Smith

Bissell, J. As to the first ground of a new trial, it has been contended, that the discharge of Wheeler on the execution, is, in law, a satisfaction of the debt; and the principal being discharged, the surety is, of course, discharged. It would be somewhat extraordinary, if it were to be held, that an act done by the advice of the defendant and for his benefit, were to have the effect of discharging him from his liability; and that contrary to the apparent intention of both parties. For, it ought to be remarked, that the object of committing Wheeler to prison, was, to fix beyond a question the liability of the defendant; and if Wheeler was unable to pay the debt, the defendant would have been liable for the costs of commitment. He had an interest, therefore, in Wheeler’s discharge from the arrest, knowing that he was a bankrupt, and wholly unable to pay the debt. Now, it may be admitted, that the discharge of a debtor taken on execution, is, in law, a satisfaction of the debt. Still it were a perversion of the principle established by the cases, to say, that such a discharge is payment, or an actual satisfaction. The cases proceed on the ground, that the creditor, having voluntarily relinquished the process, which the law [430] had given him to enforce payment of his demand, shall not be allowed another, by which the debtor may be unreasonably harassed. Loomis v. Storrs, 4 Conn. Rep. 440. As between the debtor and creditor, therefore, the discharge is a technical satisfaction of the debt. But is it any satisfaction of the guaranty? The terms of the guaranty are, that the note shall be paid; and nothing short of actual payment, or some act or neglect of the creditor, by which the guarantor is prejudiced, will discharge the liability. This is the principle established by all the cases. Here there is no pretence of payment. And there surely can be no ground for the defendant to say, that he was prejudiced, by the act done; for the jury have found, that it was done by his request. There is neither principle nor honesty in this defence; and to suffer it to prevail, would be a reproach to the law. The next and only remaining question in the case, regards the competency of Wheeler as a witness. It has been said, that he stood indifferent as between the parties; that he was liable either to pay the debt to the plaintiff, or to pay it to Smith, in the event of his being subjected; and that it was wholly indifferent to him whether he paid the one or the other; and so his interest was balanced. But it is evident, that if the discharge of Wheeler on the execution operated as a satisfaction as between him and the creditor, he was directly interested to the full amount of the demand: For there can be no pretence for saying, that he would not be liable over to Smith in the event of his being subjected. He was, therefore, swearing to discharge himself from liability; and stood on the same ground as a principal swearing to discharge his bail. But if this were not so, still Wheeler would not be indifferent. This is the case of a note not negotiable; and the maker is, in such case, bound, on his implied undertaking, to save the guarantor harmless. He would, therefore, be liable for the costs in this action. This destroys the balance of interest, and renders the witness incompetent. I would not advise to the granting of a new trial. The other Judges were of the same opinion, except Peters, J., who was absent when the case was decided. New trial not to be granted.