Powell v. Kettelle

The Opinion of the Court was delivered by Scates, J. In 1836, one Thomas J. Hurd purchased a certain lot of the school land at two hundred and fifty dollars, for which he executed his joint note with H. P. Johnson security, payable in one, two, and three years, &c., with a mortgage upon the premises. The note, not being paid, the mortgage was foreclosed, and the land sold to the trustees of the same township for sixty six dollars, sixty six and two thirds cents. Johnson died intestate. Hurd was sued upon the note, and prosecuted to insolvency. This bill was filed against Powell and Bryan, the administrators of Johnson, to obtain payment out of his estate. They answer, admitting that their intestate executed the note jointly with Hurd as his security merely; that Hurd is insolvent; and state that it is probable Johnson’s estate will also be insolvent, and that injustice will be done the creditors of Johnson, by allowing this claim. The Court made a decree that this debt be paid in the due course of administration, and that it be put in the fourth class of debts, and paid pro rata with other debts in that class, in case the estate be insolvent. The decree also gives costs, and awards execution in case the debt be not paid. This decree, and its several orders are assigned for error. The only question of any importance is, whether the estate of a joint obligor, who is mere surety, is not discharged, by the death of such surety before suit brought. The other question about the want of a prayer, we do not regard as of any importance, for the object is to determine the liability, and ascertain its amount, that it maybe filed with the Probate Court, for'payment in the due course of administration. By the principles of the Common Law, when one joint obligor dies, all right of action at law, as against his estate, or his administrators*- is gone. 1 Chitty’s Pl. 57. It was only in Equity that relief and satisfaction could be had out of his estate. And even here, some nice distinctions were adopted, under which relief was refused, unless the intestate participated in the benefits of the consideration, or was, from the nature of the agreement, or, from the circumstances, ought to be treated as a several obligor. If a separate liability is to be shown from the circumstances of the case, and the requirements of the law governing those sales, as a ground of relieving against the estate of a deceased surety, the liability is most clear in this case. The law regulating the sale of school land, and directing the kind of contract to be entered into, with the time and terms of credit, &c., is the public law of the land, and the security must take notice, at his peril, the liability the law imposed on a surety to a purchaser at such a sale. The statute has made these notes joint and several, for it has given the form of the obligation to be signed by the purchaser and his surety, and by it, they are to become jointly and severally liable for the purchase money, the law also declaring that the surety shall be liable in all respects as principal. Digest of School Laws, 11, § 10; Ib. 19, § 1; Ib. 31. Preference is given school debts above all others, except the expenses attending the last sickness. Ib. 20, § 4. From the provisions and spirit of these laws, we cannot interpret the obligation of the defendant’s intestate on being that of a mere joint security in Law or Equity, and to be discharged by death. Under this view of the surviving liability of Johnson, imposed by the laws under which he entered into the contract, it is unnecessary to advert to the many nice distinctions in Equity, upon which the Court will fix, or discharge that liability. The law has fixed.upon him as a several obligor and principal, a liability to pay this debt, and Equity will enforce it, notwithstanding the terms of this contract were joint, and he was merely a security. The decree providing for the issuing an execution under it, was erroneous, and that part will be reversed. The remainder of the decree will he affirmed, each party paying his own cost in this Court.