Olendorf v. Swartz

Terry, J., delivered the opinion of the Court. Murray, C. J., and Heydenfeldt, J., concurred.

This cause was tried by the Court without the intervention of a jury, and judgment rendered in favor of plaintiff. It is stipulated, that the finding of the facts by the Court shall constitute the statement on appeal.

[482]From this finding, it appears that defendant being the holder of two promissory notes secured by mortgages, indorsed said notes, and assigned said mortgages before maturity, and for a full consideration, to one Palmer, since deceased, of whom plaintiff is executor.

It does not appear that the notes were presented to the payee at maturity, and notice of demand and non-payment given to defendant.

Defendant, in conversation with a third party after the maturity of the notes, said, “ that the fact of notice not having been given at a proper time would make no difference with him—that he would do what was right.” Upon these facts, the Court below decided, that “ no presentment and notice of non-payment was necessary in order to bind defendant; he, having taken security in advance, is liable as principal.”

This conclusion of law, from the facts found, is clearly erroneous. The mortgages were taken to secure the ultimate payment of the notes, were assigned by defendant at the time of endorsing them, and were beyond his control. They were evidently not intended to indemnify defendant against his liability as indorser, and could have no such effect.

But it is contended by counsel for plaintiff, that although the Court below may have erred in the view taken of the point on which the decision was predicated, that the declaration of defendant “ that he would do what is right,” is sufficient of itself to sustain the judgment, and consequently it should be affirmed.

I do not think this declaration addressed to a third party, not interested in the subject matter, a sufficient waiver of presentment and notice, to fix the liability of the indorser in this case.

Judgment reversed with costs, and cause remanded.