Whitehouse v. Hanson

Bell, C. J.* It is a presumption of law that the parties to a promissory note stand to each other in the relations in which the signatures appear. ' The signers on the face of the paper are taken to be joint principals, unless — 18 — some are designated as sureties; and the signers on the back to be indorsers, in the order in which the names are written, if nothing in the terms of the indorsements indicates the contrary. Clapp v. Rice, 13 Gray 403. In the case of a bond fide holder of such a note, without notice, this presumption is conclusive. Grafton Bank v. Kent, 4 N. H. 224; Nichols v. Parsons, 6 N. H. 30. But, generally, this presumption is not conclusive as to others, but is merely a prima facie presumption, which stands till the contrary is proved. Whenever it is material, a defendant may show, even against a bond fide holder of a note, by extrinsic evidence, that he made the note as a surety only, and that this was known to the plaintiff when he took it. 4 N. H. 224; Artcher v. Douglas, 5 Den. 509. As between the signers of a note, the legal presumption maybe rebutted, by showing what are the actual relations of the parties. If all appear as signers of a note, without distinction, so that they would be presumed to be joint debtors, it may be shown that one of them signed for the accommodation and as the surety of another. Harris v. Brooks, 21 Pick. 196; Davis v. Barrington, 30 N. H. 525; Norton v. Coons, 2 Seld. 41; Carpenter v. King, 9 Met. 515. If one adds the word principal, or adds nothing to his name, and another adds surety to his, so that, on the face of the paper, they would be taken to be principal and surety, it may be shown, as between themselves, that the apparent surety was the actual principal, and bound to indemnify the apparent principal as his surety. Ibid.; Crosby v. Wyatt, 23 Me. 156; Fernald v. Dawley, 13 Shep. 470; McGee v. Prouty, 9 Met. 547; 21 Pick. 196. The acceptor of a bill, or maker of a promissory note, is presumed to be the principal debtor, and the drawer of the bill and the indorsers are to be regarded as quasi sureties for them. But as between themselves, it may be proved that either of the signers is the real debtor, and bound to indemnify the others as his sureties. Pickering v. Marsh, — 19 — 7 N. H. 192; Parks v. Ingram, 22 N. H. 283; Griffith v. Read, 21 Wend. 502; Barry v. Ransom, 2 Kern. 462; McGee v. Prouty, 9 Met. 547; Weston v. Chamberlain, 7 Cush. 404; Clapp v. Rice, 13 Gray 403. Upon the same principle, it is presumed that those who appear to be sureties, or who are proved to be such, are sureties for the principal debtor, and co-sureties for each other; but this is not necessarily the case, and it may, consequently, be shown that any of the sureties, or quasi sureties, the indorsers, are not, as between themselves, co-sureties, or liable as indorsers, as their signatures appear, but one is a surety for the other. Currier v. Fellows, 27 N. H. 366; Davis v. Barrington, 30 N. H. 517; Cutter v. Emery, 37 N. H. 576. And, agreeably to this principle, it has been held that one of those who appear as sureties, or who are proved to be sureties, may be shown to have become surety at the request of another, as where, in Taylor v. Savage, 12 Mass. 98, the defendant refused to sign at the request of the principal, and the other surety said to him, “Well, if you will not do it for him, do it for me; I will hold you harmless.” And, in such a case, the surety thus soliciting the other to sign, will have no claim against him for contribution, but will be bound to indemnify him for any loss lie may sustain by reason of signing for him under such circumstances. Turner v. Davis, 2 Esp. 478; 1 Story’s Eq. 476; Blake v. Cole, 22 Pick. 101; Apgar v. Hiler, 4 Zab. 812; Byers v. McClanahan, 6 G. & J. 250; Ad. Eq. 606; 2 Swift’s Sys. 152; Craythorne v. Swinburn, 14 Ves. 160; Daniel v. Ballard, 2 Dana 296. In the present case, the plaintiff, who, as a surety, claims the reimbursement of the money he has paid, of the two defendants, as his principals, has the primd facie presumption in his favor, resulting from the signatures as they stand on the face of the note. Place, Trickey and Hanson signed their names in that order without any designation of their relations to — 20 — each other. Prima facie, they are joint debtors. The plaintiff signed his name under theirs, adding the designation of surety. Until the presumption of law is rebutted by proof, the plaintiff is to be regarded as a surety for the three. Crosby v. Wyatt, 10 Shep. 156; Fernald v. Dawley, 13 Shep. 470. This presumption is met and rebutted by the proof that Place was the principal for whose accommodation the note was made and the money obtained, and that he had the whole benefit of the loan; and that the defendants as well as the plaintiff' were only sureties for him. 13 Shep. 470; Warner v. Price, 3 Wend. 397. To prove, then, that the plaintiff, though as to the bank he was a surety for the same person, and for the same sum as the defendants, was not their co-surety, and liable to contribute with them to the payment of the note; but, on the contrary, was entitled to hold them liable to him as principals for his complete indemnity, it becomes necessary to inquire what facts must be proved. There is no presumption that a surety assents to be bound as a principal for the whole debt to other sureties, in case his principal is unable to obtain sureties satisfactory to his creditor, subject to the usual rights and obligations of sureties. Nothing in the nature of the contract, or in the usual course of business, would justify such a presumption. The utmost that can be reasonably presumed is, that he is willing to be a co-surety with other equal co-sureties; as where others sign as sureties, without his knowledge, he and they will be held as co-sureties. Barry v. Ransom, 2 Kern. 462; 3 Den. 130; 9 Met. 547; Stuart v. Vance, 1 Rob. Va. 169. And very slight evidence tending to show that it was understood, at the time of the signing, that certain definite persons were to be the sureties, would probably be sufficient to rebut that presumption. It is not enough to show that a party who is applied to — 21 — to become a surety, after other sureties have signed, added to his name surety for the above, or for the former signers, or entered into a contract by which he bound himself to pay on failure of the others, to make himself a surety for those who have signed before him, or to make them principals as between him and them. By signing, they assume the liabilities of sureties only, and no third person, by his own act merely, without their consent, can increase or change, to their disadvantage, the obligations they have assumed. They can be made liable as principals, on a note they have signed as sureties, by their own act alone. The effect, then, of such a mode of signing is neither to make the signer a co-surety with previous signers, and so entitled to contribution from them, nor a surety for them, as between them and him, and so entitled to an indemnity from them. The terms of his subscription exclude the former. Harris v. Warner, 13 Wend. 400. He is not surety for them, because it is not their debt, and they have not made it theirs by any act of their own; he has not signed it at their request, or for their accommodation. He is presumptively a separate and sole surety, for the debtor, at whose request he signed, entitled to look to him only for his indemnity, and by his own act disabled to claim that he is a co-surety, and entitled to contribution from other sureties. Norton v. Coons, 3 Den. 132; Craythorne v. Swinburn, 14 Ves. 160; Harris v. Warner, 13 Wend. 400; Langley v. Griggs, 10 Pick. 121; 1 Story’s Eq. 498. It will not be understood from the fact that a party signs as surety, after several others have signed, that he claims to be surety for all who have signed before him. His signature, in that form, merely imports that he is a surety, and not a principal, and that he is surety for whoever is principal in fact, and a co-surety with those who are sureties. To that extent it affords only a presumption, which may be rebutted, as has been said. He can not recover any more than a contribution from those who are — 22 — proved to be, like himself, sureties. Robinson v. Lyle, 10 Barb. 512; Woodworth v. Bowes, 5 Ind. (Port.) 276; Sisson v. Barrett, 6 Barb. 200; S. C., 2 Comst. 406; McGee v. Prouty, 9 Met. 547. The party, then, who asserts that the sureties for the principal debtor have become principals as to him, must prove that he assumed the relation of surety at their request and for their accommodation. In the language of Savage, C. J., in Warner v. Price, 3 Wend. 399, “a state of facts must be shown to the court from which it shall appear positively, or by legal intendment, that the defendants intended, as to the subsequent signer, to stand in the character of a principal.” This case was very closely parallel to the case before us. It was a note, signed by three persons, as sureties for Price, the first signer, for his sole benefit and accommodation, without designation of their relation as sureties, to be discounted at a bank. The bank refused it without other names. The plaintiff, at Price’s request, signed it, adding surety to his name. He had it to pay, and brought an action against Price and the three first signers as principals, but it was held the action could not be maintained. The same point was decided in Sisson v. Barrett, 2 Comst. 406; S. C., 6 Barb. 200. A promissory note was made by A, B and C, A being the principal debtor. C, the last signer, added surety to his signature. It was held that he must show that he was a surety for B, by evidence extrinsic to the note, before he could treat him as a principal debtor. In McGee v. Prouty, 9 Met. 547, A, B, C and D signed a promissory note. C and D only added surety to their names. I) paid the note, and sued A and B, jointly. It was held that B might prove by parol that he signed the note as surety for A, and as it appeared that C and D signed at the request of A only, the action could not be maintained. — 23 — Fernald v. Dawley, 13 Shep. 473, was decided in the same way, upon the doctrine of Warner v. Price, that those who sign as sureties shall be held co-sureties, unless it appears that the defendants intended to stand as principals to the subsequent signers. In Harris v. Warner, 13 Wend. 400, the case of Warner v. Price, 3 Wend. 397, was affirmed; and the principle of that decision was adopted by us in Cutter v. Emery, 37 N. H. 576. See Beaman v. Blanchard, 4 Wend. 432. The fact that one surety signed as such, substantially at the request and for the accommodation of another, is necessary to be proved, and is all that is required to bar the flatter of his action for contribution, and to compel him to- indemnify the former for what he may be compelled to pay. Ibid.; 1 Story’s Eq. 476; Ad. Eq. 606; Taylor v. Savage, 12 Mass. 102; Daniel v. Ballard, 2 Dana 296; Byers v. McClanahan, 6 G. & J. 256; Blake v. Cole, 22 Pick. 101; Apgar v. Hiler, 4 Zab. 812; Turner v. Davis, 2 Esp. 478; Thomas v. Cook, 8 B. & C. 728. Having thus seen what is necessary for the plaintiff to prove, in order to maintain his action, we are now to see if the evidence of the plaintiff was competent to establish the fact that the plaintiff signed this note for the accommodation of the defendants, at their request, or upon any agreement by them to indemnify him. The plaintiff testifies that he was applied to by Place to sign his name, but he does not say that he was applied to by either of the defendants, or that Place claimed to act for them, or that he had any authority for them, or that he named them in any way. He says the defendants’ names were on the note. He did not know they were sureties. If he had known it, he should not have signed. Stackpole -represents the transaction between Place and himself in a similar way, except that Place asked him to sign with him and the defendants as principals. The defendants say they signed for Place’s accommoda — 24 — tion alone, at Ms request. They do not state that they had any conversation with each other, or with White-house, or Stackpole, or that they gave any authority to Place to act for them, except what may be implied from signing the note. This evidence falls entirely short of proving that the plaintiff signed as surety, at the request of the defendants, or either of them, or that the defendants assented to stand in the relation of principals as to him. The charge to the jury did not place the question on the ground before stated, that the plaintiff must show, in order to charge the defendants, that he signed at their request, either made personally or through some agent for that purpose. It was said, “if the defendants, having signed their names to this note with Place, as they did, allowed him to take the note and go out into the market, or to the Savings Bank, for the purpose of raising money on it, they thereby, by legal intendment, made him their agent for that purpose, and adopted his acts and declarations, and would be bound by them. Hence the representations made to the plaintiff by Place, in order to obtain his aid to effect this purpose of raising money, became evidence for the jury, and if they believed they were made, might justify them in charging the defendants in this case.” Por the reasons already assigned, we are unable to assent that the statements of Place, if authorized, were enough to charge the defendants. They fall short of expressing, in any form, any desire of the defendants that the plaintiff would sign the note. Place expressed his own wish, but did not pretend to speak for them. And he did not represent to the plaintiff that they were principals in any other way, than by presenting to him the note signed by them, without the addition of surety. By giving him the note, the defendants authorized him to represent whatever the note stated, that is, that they had — 25 — signed the note in sucb a manner that they would be taken to be principals, if they did not prove they were sureties. Such information, if given upon due authority, could have served only to promote inquiry. It would be a strong assumption that the plaintiff, upon being told by Place that the defendants probably, or presumptively, signed as principals, could take it for granted, without inquiry, that they did so. Stackpole’s memorandum was introduced in aid of his memory. He did not know the date, but had a note of it, which he knew to be correct. In such a case, the memorandum, with the oath, is evidence. Haven v. Wendell, 11 N. H. 112. The caution of the judge, that it was of weight only as to the time, was all that was necessary to be said of it. The declarations of Hanson were inadmissible, but immaterial. The declarations of Place were properly admitted as part of the res gestee. Verdict set aside. Footnotes [*] Doe, J., did not sit.