Northrup v. Harrison

BROADDUS, J. This is a suit on a negotiable promissory note against Harrison Chambers as receiver of the Excelsior Springs Company, the maker, and against the other defendants, who were joint payees, as joint indorsers. -The note reads as follows, to-wit: “$2,500. Kansas City, Mo., July 14, 1893. “Eour months after date the Excelsior Springs Company promises to pay to the order of H. M. Holden, J. S. Chick, L. R. Moore, E. L. Martin and S. F. Scott, twenty-five hundred dollars for value received, payable at the National Bank of Kansas City, Missouri, with interest from maturity at the rate of eight per cent per annum. (Signed.) “Excelsior Springs Company. “By H. M. Holden.” The indorsement on the back of the note is as follows, to-wit: “H. M. Holden, J. S. Chick, L. R. Moore, “E. L. Martin, S. E. Scott. “Protested for non-payment November 17, 1893. “Wm. L. Stocking, Notary.” The cause was dismissed as to defendant Chambers, receiver of the Excelsior Springs Company, before trial. Da [65] fendant Holden filed an answer in the nature of a general denial and plea of payment. Defendant Chick answered by a general denial. Defendant Moore answered to the first petition, but did not answer the amended petition on which the case was tried. The defendant Martin filed an answer in the nature of a general denial, pleading payment. The defendant Scott made default. Judgment was rendered against defendants J. S. Chick and S. E. Scott. The finding of the court was in favor of defendants Holden and Martin against plaintiff, from which finding the plaintiff has taken-this writ of error. L. L. Northrup, Sr., was the first indorsee of the note and it is admitted that the plaintiff lawfully became the second holder and owner thereof. The note was shown to have been entitled to the following credit, viz.: “July, 1894, of $83.08; and on March 23, 1895, $1,300, paid by J. S. Chick.” On the evidence, the court found that protests was not properly made upon the defendant L. R. Moore, but was made as to the other defendants. The only question before this court, is, did the failure to protest against L. R. Moore, one of the joint indorsers, in law have the effect to release the other joint indorsers? It is contended that under a proper construction of the statutes of Missouri that the release of one of the joint indorsers did not have the effect to release the other joint indorsers because their undertaking under said statute was not only joint but several; and the release of one joint obligor did not release the other joint obligors or indorsers. Section 889, Revised Statutes 1899, is as follows, to-wit: “All contracts which by the common law are joint only, shall be construed to be joint and several.” Section 897, idem, reads as follows: “It shall be lawful for every creditor of two or more debtors, joint or several, to compound with any and every one or more of his debtors for [66] such sum as he may see fit, and to release him or them from all further liability to him for such indebtedness, without impairing his right, to demand and collect the balance of such indebtedness from the other debtor or debtors thereof and not so released: Provided, that no such release shall impair the right of any debtor of such indebtedness not so released, to have contribution from his co-debtors, as by law now secured to him.” It was held in Stagg v. Linnenfelser, 59 Mo. 336, that under the common law of England promissory notes were incapable of being transferred and were not within the custom of Merchants. The fact that such was the holding of the English courts, which gave rise to the statute of d Anne, which after calling attention to the holding of said courts, made promissory note “assignable or indorsable over, in the same manner of inland bills of exchange, according to the law merchant.” As promissory notes were not assignable and indorsable at common law, but were made so by the statute referred to and long after the reign of James the First, said section 889, supra, which relates to common-law contracts only, does not include the contract of the defendant indorsers. There has been no case called to our attention in this State upon the question involved. We are cited by appellant to the case of Jarnigen v. Stratton, 95 Tenn. 619 (32 S. W. Rep. 625), where it was held under the Tennessee code, making all obligations joint and several, that an indorser on a note, who has notice of non-payment and protest, is not discharged because such notice is not given to other indorsers. But under said code all obligations and promises are made joint and several, whereas, our statute, as we have seen, only makes common-law contracts which are joint, several. If we are to follow the case of Stagg v. Linnenfelser, supra, the obligations of joint [67] indorsers are contractual, or, to be more specific, their liability under their undertalcing is to be determined by the rules of the common law applicable to joint contracts in general. Shepherd v. Hawley, 1 Conn. 367; Hubbard v. Matthews, 54 N. Y. 49; Gantt v. Jones, 1 Cranch C. C. 210; Bank of Beirne, 1 Gratt. 266; Bank v. Keech, 26 Md. 524; Dabney v. Tidger, 4 Sm. & M. 749, and numerous other authorities. But the appellant contends that the case is to be determined upon a construction of section 897, supra, if section 889, supra, has no application. Said section, in our opinion, is applicable only in instances where a creditor of two or more-joint debtors, for a consideration, compounds, that is, contracts with one or more of them and releases that one or them from all further liability. This seams to be its plain meaning. No other kind of release is alluded to. The statute expressly relates to a compounding with and a releasing of one or more joint debtors by a creditor, and nothing more. The rule of expressio unius est exclvsio alterius; expression facii cessare ia-citum, applies. In this case there was no. compounding of any part of the debt and no release by agreement, but the release was one of law arising out of the failure to protest. Finding no error in the finding and judgment of the trial court, the cause is affirmed. All concur.