Harrington v. Citizens' Investment & Security Co.

Hart, J., (after stating the facts). It has been held by this court that the giving of a renewal note with the knowledge at the time of a failure of the consideration for the original note waives such defense, and the maker is thereby estopped from pleading such failure in an action on the renewal note. Stewart v. Simon, 111 Ark. 358, and Haglin v. Friedman, 118 Ark. 465. It is true that the consideration for the original note failed because the note was given upon the condition that the capital stock of the Citizens’ Investment & Security Company should he increased from $25,000 to $100,000. This was not done. The capital stock of the bank, however, was increased to $75,000, with. the approval of the State Bank Commissioner. Harrington was notified of this fact, and that his subscription as originally made had been applied to increase the capital stock of the bank from $25,000 to $75,000. After he received notice .of this fact by letter, he signed the note sued on in renewal of his original note. . Hence the case calls for the application of the rule announced above, and the decree of the chancery court will be affirmed.