Woeden, J.
Suit by French against Turner. The complaint contained three paragraphs, or counts, to each of which a demurrer was sustained, and final judgment was rendered for the defendant.
French, having excepted to the ruling, brings the case here for revision.
The first count, states in substance, that on November 6, 1852, one John Bodle executed and delivered to Abel 0. Pepper, a mortgage on certain land, therein described, to secure the payment of $1,100, evidenced by ten promissory notes of that date, each for $110; one payable in a year from date, and one maturing each year thereafter until they all become due, with interest payable annually. That in September, 1851, Pepper assigned and transferred the mortgage and notes, by indorsement on the' mortgage, to the defendant, Turner. That Turner, in January, 1858, for value received, transferred the mortgage and notes to the plaintiff, by indorsement in writing on the mortgage. The mortgage and notes, together with the assignment, are set out. The assignment from Turner to the plaintiff, on the mortgage, is as follows, viz:
“For value received, I hereby assign the within mortgage and notes, therein described, to John J. French.
“ January 2, 1858. (Signed,) “ Moses Turner.”
It is averred that the note which became due on November 6, 1858, and the interest on the others not due, remain due and unpaid. That, for the notes which matured before November 6, 1858, he foreclosed the mortgage, and the mortgaged premises were sold for $600, being fifty dollars less than the judgment, interest and cost. That Bodle, at the time of the execution of the notes and mortgage, had no property subject to execution except the mortgaged premises, nor did he have at the time of the maturity of any of the notes. That he is still wholly and notoriously insolvent, having no property subject to execution, [61]*61and that an action against him would be unavailing, wherefore, &c.
“'The second count alleges, that the defendant, professing to be the holder of the ten promissory notes (described in the first count), secured by the mortgage, on, &c., for value received, sold the said ten promissory notes to the plaintiff, by indorsement on the mortgage (as in the first count); and that before the said assignment, the defendant received full payment and satisfaction of the first of said series of promissory notes, to-wit: the one payable on Wovember 6, 1853, and all interest thereon, from said Bodle, which interest at the time of the assignment amounted to $30, making, of principal and interest on the note, at the time of the assignment, $140, which the defendant refuses to pay, wherefore, &c.
The third count alleges', that on, &c., the defendant professing to be the holder of the ten promissory notes and mortgage, and that the payment of the notes was secured by the mortgage, induced the plaintiff to purchase the same for a valuable consideration, fully equal to the principal sum mentioned in the notes and the interest accrued thereon; and thereupon the defendant, in pursuance of said sale, by an instrument in writing indorsed on the said mortgage, assigned the notes and mortgage to the plaintiff. That at the same time the defendant, by an instrument 'in writing, executed cotemporaneously with the assignment, covenanted and agreed with the plaintiff that the notes were secured by mortgage. And in consideration that the plaintiff -would receive the notes without indorsement, the defendant then and there agreed by parol, and undertook and promised the plaintiff, that if he could not collect the same from Bodle, the defendant would pay the plaintiff the sum of money mentioned in the notes. The foreclosure of the mortgage; the insufficiency of the mortgaged premises to pay the debt; the insolvency of Bodle, and that the note due Wovember 6, 1858, with the interest thereon, remains*due and unpaid, are averred, substantially, as in the first count.
.The first countjis evidently based upon the supposition that ./the defendant is liable as an indorser of the notes. This, however, is not the case. In order to render him thus liable, [62]*62the indorsement of the notes must have been made “thereon,” 1 R. S. 1852, p. 378, or perhaps, “ on another paper annexed thereto, (called in Prance, Allonge), which is sometimes necessai7j when there are many successive indorsements to be •made.” Story on Bills, § 204.
The indorsement in question, made upon the mortgage, refers to the notes as being therein described, and is not upon the notes, or upon any paper attached to them. Such an assignment could not operate to transfer the legal title to the notes. It would convey an equitable title, authorizing the assignee,' under our code, to sue thereon in his own name, but it does not place the assignor in the condition of a legal indorser. By such an assignment, the assignor does not warrant the solvency of the maker of the notes. It is no more effectual for that purpose than a parol assignment would be; an assignment made by the delivery of the notes. The case is analogous to the transfer of a bill payable to bearer, by delivery. “ If it is payable to the Bearer, then it may be transferred by mere delivery. But, although it may be thus transferred by mere delivery, there is nothing in the law which prevents the Payee of a Bill, payable to himself or Bearer, from transferring it, if he chooses, by indorsement. In such a case, he will incur the ordinary • liability of an Indorser, from which, in the case of a mere transfer by delivery, he is ordinarily exempt. On the transfer of a Bill, payable to the Bearer, by delivery only, without indorsement, the person making it ceases to be deemed a party to the Bill; although he may in some cases incur a limited responsibility to the person to whom he immediately transfers it, founded upon particular circumstances, as, for example, upon his express or implied guaranty of its genuineness, and his title thereto.” Story on Bills, § 200.
The defendant not being liable upon the notes, as indorser thereof, it follows, that the first count is bad, and the demurrer thereto was properly sustained.
."•^The second count we also deem defective. Admitting that the defendant impliedly warranted that the note thus transferred had not been paid to him, which would seem to be the case, still he is not liable on the contract of assignment. The plaintiff could only sue to recover what he paid for the assign[63]*63ment of the note, as for money paid upon a consideration that had failed. If property was given for the assignment, then he could only sue for the property, as for property sold and delivered; and if the assignment was for a prior debt, then the prior debt only could be sued for. Story on Prom. Notes, §§ 117, 118 and notes.
James 8. Jelley and William 8. Holman, for appellants.
A. C. Downey and II. A. Downey for appellees.
Note.—Upon, the question, as to what constitutes an indorsement, the following authorities will be found to throw some light; 2 Bl. Com. 468, 469.—Story on Notes, § 121.—1 Stranges R. 18, 19.—Rex v. Bigg, 3 Peere William’s R. 419.—11 Grattan’s R. 830.
Here, the consideration paid for the assignment, and to be recovered, if any thing, is not set out.
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Woeden, J.
Suit by French against Turner. The complaint contained three paragraphs, or counts, to each of which a demurrer was sustained, and final judgment was rendered for the defendant.
French, having excepted to the ruling, brings the case here for revision.
The first count, states in substance, that on November 6, 1852, one John Bodle executed and delivered to Abel 0. Pepper, a mortgage on certain land, therein described, to secure the payment of $1,100, evidenced by ten promissory notes of that date, each for $110; one payable in a year from date, and one maturing each year thereafter until they all become due, with interest payable annually. That in September, 1851, Pepper assigned and transferred the mortgage and notes, by indorsement on the' mortgage, to the defendant, Turner. That Turner, in January, 1858, for value received, transferred the mortgage and notes to the plaintiff, by indorsement in writing on the mortgage. The mortgage and notes, together with the assignment, are set out. The assignment from Turner to the plaintiff, on the mortgage, is as follows, viz:
“For value received, I hereby assign the within mortgage and notes, therein described, to John J. French.
“ January 2, 1858. (Signed,) “ Moses Turner.”
It is averred that the note which became due on November 6, 1858, and the interest on the others not due, remain due and unpaid. That, for the notes which matured before November 6, 1858, he foreclosed the mortgage, and the mortgaged premises were sold for $600, being fifty dollars less than the judgment, interest and cost. That Bodle, at the time of the execution of the notes and mortgage, had no property subject to execution except the mortgaged premises, nor did he have at the time of the maturity of any of the notes. That he is still wholly and notoriously insolvent, having no property subject to execution, [61]*61and that an action against him would be unavailing, wherefore, &c.
“'The second count alleges, that the defendant, professing to be the holder of the ten promissory notes (described in the first count), secured by the mortgage, on, &c., for value received, sold the said ten promissory notes to the plaintiff, by indorsement on the mortgage (as in the first count); and that before the said assignment, the defendant received full payment and satisfaction of the first of said series of promissory notes, to-wit: the one payable on Wovember 6, 1853, and all interest thereon, from said Bodle, which interest at the time of the assignment amounted to $30, making, of principal and interest on the note, at the time of the assignment, $140, which the defendant refuses to pay, wherefore, &c.
The third count alleges', that on, &c., the defendant professing to be the holder of the ten promissory notes and mortgage, and that the payment of the notes was secured by the mortgage, induced the plaintiff to purchase the same for a valuable consideration, fully equal to the principal sum mentioned in the notes and the interest accrued thereon; and thereupon the defendant, in pursuance of said sale, by an instrument in writing indorsed on the said mortgage, assigned the notes and mortgage to the plaintiff. That at the same time the defendant, by an instrument 'in writing, executed cotemporaneously with the assignment, covenanted and agreed with the plaintiff that the notes were secured by mortgage. And in consideration that the plaintiff -would receive the notes without indorsement, the defendant then and there agreed by parol, and undertook and promised the plaintiff, that if he could not collect the same from Bodle, the defendant would pay the plaintiff the sum of money mentioned in the notes. The foreclosure of the mortgage; the insufficiency of the mortgaged premises to pay the debt; the insolvency of Bodle, and that the note due Wovember 6, 1858, with the interest thereon, remains*due and unpaid, are averred, substantially, as in the first count.
.The first countjis evidently based upon the supposition that ./the defendant is liable as an indorser of the notes. This, however, is not the case. In order to render him thus liable, [62]*62the indorsement of the notes must have been made “thereon,” 1 R. S. 1852, p. 378, or perhaps, “ on another paper annexed thereto, (called in Prance, Allonge), which is sometimes necessai7j when there are many successive indorsements to be •made.” Story on Bills, § 204.
The indorsement in question, made upon the mortgage, refers to the notes as being therein described, and is not upon the notes, or upon any paper attached to them. Such an assignment could not operate to transfer the legal title to the notes. It would convey an equitable title, authorizing the assignee,' under our code, to sue thereon in his own name, but it does not place the assignor in the condition of a legal indorser. By such an assignment, the assignor does not warrant the solvency of the maker of the notes. It is no more effectual for that purpose than a parol assignment would be; an assignment made by the delivery of the notes. The case is analogous to the transfer of a bill payable to bearer, by delivery. “ If it is payable to the Bearer, then it may be transferred by mere delivery. But, although it may be thus transferred by mere delivery, there is nothing in the law which prevents the Payee of a Bill, payable to himself or Bearer, from transferring it, if he chooses, by indorsement. In such a case, he will incur the ordinary • liability of an Indorser, from which, in the case of a mere transfer by delivery, he is ordinarily exempt. On the transfer of a Bill, payable to the Bearer, by delivery only, without indorsement, the person making it ceases to be deemed a party to the Bill; although he may in some cases incur a limited responsibility to the person to whom he immediately transfers it, founded upon particular circumstances, as, for example, upon his express or implied guaranty of its genuineness, and his title thereto.” Story on Bills, § 200.
The defendant not being liable upon the notes, as indorser thereof, it follows, that the first count is bad, and the demurrer thereto was properly sustained.
."•^The second count we also deem defective. Admitting that the defendant impliedly warranted that the note thus transferred had not been paid to him, which would seem to be the case, still he is not liable on the contract of assignment. The plaintiff could only sue to recover what he paid for the assign[63]*63ment of the note, as for money paid upon a consideration that had failed. If property was given for the assignment, then he could only sue for the property, as for property sold and delivered; and if the assignment was for a prior debt, then the prior debt only could be sued for. Story on Prom. Notes, §§ 117, 118 and notes.
James 8. Jelley and William 8. Holman, for appellants.
A. C. Downey and II. A. Downey for appellees.
Note.—Upon, the question, as to what constitutes an indorsement, the following authorities will be found to throw some light; 2 Bl. Com. 468, 469.—Story on Notes, § 121.—1 Stranges R. 18, 19.—Rex v. Bigg, 3 Peere William’s R. 419.—11 Grattan’s R. 830.
Here, the consideration paid for the assignment, and to be recovered, if any thing, is not set out. Nothing more is averred in this respect than that the assignment was made “ for value received.” In what the value was received, whether in money, and if so, how much, or property, or by way of satisfaction of a precedent debt, does not appear. There is, evidently, not enough stated to show what the plaintiff paid, and, therefore not enough to show what he was entitled to recover.
The third count is clearly defective.
The instrument in writing therein mentioned, executed cotemporaneously with the assignment, by which, as is alleged, the defendant agreed that the notes were secured by mortgage, is not set out, and therefore the case stands as if the allegations in that respect were stricken out. The parol agreement made, as is alleged, cotemporaneously with the written assignment, can not be admitted to vary or extend the effect of the assignment as written. The doctrine in this respect is stated in the case of McClure v. Jeffrey, 8 Ind. 79, as follows : “ The rule is, that all oral negotiations or stipulations between the parties, which preceded or accompanied the execution of the instrument, are to be regarded as merged in it, and the latter is to be treated as the exclusive medium of ascertaining the agreement to which the contractors bound themselves.”
The demurrers, we think, were correctly sustained, and the judgment must be affirmed.
Per Curiam.
The judgment is affirmed, with costs.