Keyes v. Dyer

1952 OK 166, 243 P.2d 710, 206 Okla. 325, 1952 Okla. LEXIS 590
CourtSupreme Court of Oklahoma
DecidedApril 23, 1952
Docket34607
StatusPublished
Cited by4 cases

This text of 1952 OK 166 (Keyes v. Dyer) is published on Counsel Stack Legal Research, covering Supreme Court of Oklahoma primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Keyes v. Dyer, 1952 OK 166, 243 P.2d 710, 206 Okla. 325, 1952 Okla. LEXIS 590 (Okla. 1952).

Opinion

PER CURIAM.

This is an action by a surety against his principal, makers of a promissory note, for reimbursement of money paid by the surety in satisfaction of a judgment recovered upon said note by the payee thereof against said makers. Reference will hereinafter be made to the respective parties as plaintiff and defendant, according to their designation in the court below.

On Ndvember 28, 1933, the defendant, M. W. Kéyes, .the plaintiff, R. W. Dyer, and one C. B. Keyes joined as makers in executing a promissory note payable to one J.- D. Laney on December 1, 1934-.- On February 27, 1937, the payee, J. D. Laney, recovered a joint and several judgment upon said note against the said makers thereof. The-judgment was kept alive by successive executions. On January 19, 1946, thé plaintiff was compelled to pay said judgment and a release thereof was filed in the cause in which said judgment was entered. On November 5, 1948, the plaintiff brought this action and in his- petition alleged the foregoing admitted facts, and attached and made a part of his petition copies of said note, judgment, and release of judgment. Plaintiff further alleged, and defendant admits, that said note was executed'by the defendant as principal and by the plaintiff and one C. B. Keyes as sureties. The plaintiff alleged that he was entitled to reimbursement from the defendant and the prayer was for judgment against defendant for the amount paid by plaintiff in satisfaction of said judgment, together with interest and costs. The existence of the principal and surety relationship between the makers of said note is not disclosed by either said note or judgment.

The trial below without the intervention of a jury resulted in a judgment for plaintiff conforming to the prayer of his petition. Defendant appeals.

The first question for our determination is whether the action is barred by the statute of limitations.

“Civil actions, other than for the recovery of real property, can only be brought within the following periods, after the cause of action shall have accrued, and not afterwards:

“First. Within five years: An action upon any contract, agreement or promise in writing.
“Second. Within three years: An action upon a contract express or implied not in writing; an action upon a liability created by statute other than a forfeiture or penalty.” 12 O. S. 1951 §95.

Defendant contends that if plaintiff’s action is on the original note or judgment rendered thereon, the statute, supra, had barred the action.

According to the prevailing' view, the remedy at law of the surety who has paid a note or satisfied- a judgment for his principal is an action on the obligation, implied by law, of the principal to reimburse his surety. 72 C.J.S., p. 786, §323; 50 Am. Jur. p. 1047, §§219, 220.

The history of the statute of limitations, supra (12 O. S. 1951 §95), may be traced to a similar statute of the State of Kansas, and we are favorably impresssed with the logic of the Supreme Court of Kansas in the case of Guild v. McDaniels (1890) 43 Kan. 548, 23 P. 607, wherein the majority rule was followed, and the court held:

“Where a joint maker of a promissory note, or his representative, pays the note, and then brings an action against the other maker, upon the ground that he is in fact only a surety, his action, although brought upon the note, must be mainly proved by parol evidence; because he must show by such evidence the amount he paid upon the note, the date of payment, that his joint maker is the principal, and that he is a surety only. Therefore, the action is founded on an unwritten and implied agreement of his principal, and must be brought within three years.”

*327 Defendant points out that Oklahoma has consistently followed McClure v. Johnson (1898) 10 Okla. 663, 65 P. 103, wherein the Supreme Court of the Territory of Oklahoma held:

“In this Territory, under the statute, as well as at common law, the right of action of the surety who has discharged the promissory note of his principal is against the principal, upon the note, and not upon an implied promise to pay. A surety who pays is subrogated to all the rights of the holder of the note, one of which is the possession of the promissory note, and the right of action upon it against the principal; and he may pursue his remedy upon the note -which he has paid, as against the principal, who is primarily liable, to the extent of reimbursing what he has expended.”

McClure v. Johnson, supra, was followed by this court in Pendergraft v. Phillips (1916) 57 Okla. 105, 156 P. 1189. It should, however, be observed that in McClure v. Johnson, supra, the note was endorsed without recourse by the payee thereof. In Pendergraft v. Phillips, supra, the note was assigned by the payee, sind the surety, a joint maker of the note in each case upon satisfying the obligation, pursued his rights under the statute (15 O. S. 1951 §382, infra) to enforce the remedy which the payee of the note then had against the principal. Furthermore, by force of a statute enacted in Oklahoma after the decision in McClure v. Johnson, supra, a promissory note is not discharged upon payment thereof by a party secondarily liable thereon (48 O. S. 1951 §263). Whitten v. Kroeger, 183 Okla. 327, 82 P. 2d 668.

In Fox v. Kroeger, 119 Tex. 511, 35 S. W. 2d 679, 77 A. L. R. 663, the Texas Supreme Court construed a statute identical with 48 O. S. 1951 §§261 and 263, and the decision there supports the Oklahoma view above set forth. In that case we again observe that the surety, a joint maker of a promissory note, was compelled to pay the note and on so doing took an assignment thereof and brought the action on the note itself.

It is recognized in Guild v. McDaniels, supra, that written evidence of the relationship of the parties, ánd assignments and transfers in writing of the creditor’s security to the party secondarily liable thereon, are important factors in determining the nature of the latter’s action.

The rule in McClure v. Johnson, supra, is not controlling in the determination of the nature of this action, in view of the distinguishing factors present here and the cumulative rights and remedies of a surety under the statutes of Oklahoma cited herein.

The note here was merged in a judgment in favor of the payee against the makers thereof. The plaintiff, one of the makers of said note and bearing the relationship of a surety thereon, was compelled to pay said judgment and said judgment was thereupon re-' leased by the judgment creditor.

In addition to the remedies in the nature of subrogation conferred by 15 O. S. 1951 §382, infra, the statute construed in the case of McClure v. Johnson, supra, we observe that the obligation of a principal to reimburse his surety, implied in law, finds express recognition in a companion statute.

“If a Surety satisfies the principal obligation, or any part thereof, whether with or without legal proceedings, the principal is bound to reimburse what he has disbursed, including necessary costs and expenses; * * * ” 15 O. S. 1951 §381.

Plaintiffs petition not only alleged the note and the judgment thereon, but also pleaded payment of the judgment and the release and satisfaction thereof.

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Bluebook (online)
1952 OK 166, 243 P.2d 710, 206 Okla. 325, 1952 Okla. LEXIS 590, Counsel Stack Legal Research, https://law.counselstack.com/opinion/keyes-v-dyer-okla-1952.