Klepper v. Borchsenius

Pillsbuey, J. Before expressing our viexvs upon the merits of the case we will dispose of the motion made by appellee to strike the bill of exceptions from the record which xvas taken with the cause. It. appears from the record originally7 filed in this court that the bill of exceptions was presented to and signed by the judge after the expiration of the rule entered of record, but by the additional record taken in connection with the former it appears that the rule to file the bill was first extended for ninety days by agreement of the parties and a further extension granted by the court in term time and before the former rule expired, which last rule was complied xvitli by presenting the bill to the judge before its expiration. The judge took the bill for examination and held it for some time, when he signed it, and the record shoxvs that the appellee consented that the same might be filed nunc pro tunc and within the time limited by the last extension of the rule. A party presenting his bill to the judge within the rule is not to be prejudiced by7 the action of the judge in neglecting to sign it until the rule expires, and as to the propriety of the court extending the rule from time to time, we are of the opinion that a party consenting that the bill may be filed within the time limited by such extension of the rule can not for the first time urge in this court that such extensions were improperly granted, but must be treated as having waived any improper action of the court in that regard. The motion should be overruled. As counsel urge no error upon that branch of the case involved in the claim for the goods we shall not notice it. The most serious questions in the case arise upon the action of the court in excluding the offered evidence and in its charge to the jury. It is quite evident that the court below considered that no contract made by the appellee with the principal of the note or with him and the payee thereof would exonerate him from the liability to contribution in favor of the appellant as a co-surety, but to have that effect such agreement must be made with the appellee. It may be freely admitted that the note was the only proper evidence of the contract between the parties to it, - the makers and the payee', and this upon the familiar principle that a written agreement can not be varied by parol_evidence. But is the note alike conclusive as an instrument of evidence, between the makers in determining the relation they 3-espect-ively sustain as to each other? The right to contribution among co-sm*eties does not necessaidly depend upon any contract between them but is founded in doctrines of equity, and formerly was enforced in courts of equity only, the rule applied being that “ equality is equity” among persons standing in the sai33e situation. Subsequently courts of law took jurisdiction of actions for contribution on the ground that as equity and good conscience requii’ed that as among co-sureties thei’e should be equality of burden, an implied assumpsit arose in favor of the one paying more than his pi’oportionate share of the common debt, and which would support an action at law. DeColyar on Guars. and Sureties, 334-36. The right of the plaintiff to sustain his action for contribution against a co-surety does not depend upon the terms or character of the instrument by which they become bound, but upon the relation they actually sustain to each other.- The fact being made to appear that they both signed as sureties of the principal debtor, then prima facie, the duty to contribute is established. Bnt such fact is not conclusive upon the defendant, and he may show the nature of the transaction and thereby establish the relation that really existed between the makers of the note. Upon the face of the note the makers may all appear to be principals, but it may be shown who were principals and who sureties, when the question is between them alone. The note is the contract between them and the payee, and it may well be; as to the parties thereto, it is the only evidence of the contract; bnt it does not purport to be, nor to disclose the contract, if any there be, or the relation subsisting among the makers, as the party of the one part to it. The note does not of itself establish a right of recovery in actions like the present. The plaintiff must, in addition, show that the- defendant occupied such a position as one of the signers of the note, that equity and good conscience demands that he should assume a proportionate share of the obligation that has been discharged by the plaintiff. Harris v. Warner, 13 Wend. 400. The principal debtor testified in this case, that he told the appellee when the note was presented to him, that the appellant would only sign for one hundred dollars; but this is defied by the appellee, and we shall consider the case as presented by the statement of appellee, it being more favorable for him in that view. Thus considered, the record is barren of any proofs tending to show that there was any agreement or understanding between the parties that the appellant was to sign the note as a co-surety of the appellee. Neither was the appellee misled by anything appearing upon the face of the note when his signature was obtained, as appellant had not then signed it; and so far as appears, nothing whatever was done by the appellant to induce the belief in the mind of appellee that the appellant was to sign the note in any capacity. Of course, these1 circumstances can have no effect, if the appellant did actually sign as co-surety with the appellees, for it is the fact of co-suretyship that gives the right of contribution, knowledge of who are such sureties being immaterial in the case. They do, however, have-an important-bearing in view of the claim of the appellant that he refused to be bound as a co-surety, but limited his liability by a parol agreement between himself, the payee -and the principal debtor to one hundred dollars, for if by any fraud upon his part he induced the appellee to sign the note in the belief, that he also would execute as a co-surety, he should not now be heard to say that he had limited his liability. At the time, then, the appellee signed the note and delivered it to the principal debtor, it was á complete negotiable instrument, and he could not complain if the payee had then accepted it without further security, and in this condition it was presented to the aj)pellee with a request'that he would also sign it. The appellee-had a perfect right to refuse to sign the note at all, or if he did so, he could limit his liability in any manner he saw lit. Being under no obligations to any of the prior makers of the note, he could have signed it as security for all the makers, as in Harris v. Warner, 13 Wend. 400, or as a surety for the other sureties, as in Adams v. Flanagan, 36 Vt. 400, and in Oldham v. Broom, 28 Ohio St. 41, or he could have made himself a guarantor for the whole or any portion of said notes; and had he done so by apt words' upon the note, it is probable no question would be made as to the liability assumed. This he attempted to do by having the figures 100 written after his name as expressing the limit of his liability. Whether in a suit by the payee against the makers of the note he could explain the meaning of those figures is not material now to consider, but as we have said, in a suit for contribution the note not conclusively determining' the relation existing between the makers, the nature of the transaction can be shown by parol evidence, of which the act of the appellant in having the figures inserted is to be considered as having a bearing upon it. ¡Regarding the introduction of extrinsic evidence in such cases the principle is so clearly stated in the note to the case of Dering v. Earl of Winchelsea, 1 Smith L. Cas. in Eq., page 169, that we quote therefrom: “ The relation of principal and surety and that which exists between co-sureties, lies in a great measure without the contract with the creditor, although founded upon and growing out of it, and may consequently be proved or negatived by extrinsic and unwritten evidence, even when the contract itself is in writing. The main and obyious purpose of reducing an agreement to writing is to perpetuate and define the obligations which it sets forth, or calls into being, between the parties who contract with and bind themselves to eacli other in and by the agreement, and not to express the collateral relations which exist, or the duties which may arise between parties of the same part.” In Adams v. Flannagan, supra, the note had been signed by Adams and one Boynton as sureties, and was then presented to the Flannagans with a request to become sureties by Mills, the principal in the note, the attorney of the payee being present, and the Flannagans then told them that they would not sign as co-sureties of Adams and Boynton, but would sign as their sureties; and thereupon the firm name of the Flannagans was signed and the word “ surety ” written after it. Adams in signing the note had also written the same word after his signature. It was held that under such-circumstances the Flannagans were not bound as co-sureties with Adams, and that parol evidence was admissible to show their real undertaking. In Oldham v. Broom, supra, the surety, Oldham, was allowed to prove by parol that his agreement with the principal debtor was that he would only sign as a surety for the principal and Broom, the other surety, and this was held a defense, although neither the creditor nor Broom had notice of such limitation. These cases appear to be so full}' in point and the authorities being so generally referred to therein, we deem it unnecessary for us to cite others bearing upon the same question. The appellant having stipulated with the principal debtor for a limitation of liability, and that appearing in proof, it would seem that he should be allowed to prove that at and before the time the payee received the note and parted with his money, he was informed of such limitation of liability assnmed by appellant and accepted the' noté with that understanding. Although he might have taken the advantage of the terms of the written contract alone, he was not obliged to do so, but could, if lie saw proper, only demand the one hundred dollars from appellant and collect the balance of the note from the appellee. The appellee can not, we think, avail himself of the technical advantage.of the payee when he did not see proper to exercise it for himself. We are of the opinion that the court below erred in excluding the offered evidence and in instructing the jury as shown above, for which we must reverse the judgment and remand the cause. Reversed and remanded.