May v. White

40 Iowa 246

• Court: Supreme Court of Iowa
• Decided: March 19, 1875
• Status: Published

Opinion

Day, J.

I. It cannot be successfully maintained that there is no evidence that the Noble and Stoner note was given, or received as collateral security.

It is true it may not have been distinctly stated'at the time that the note was intended as collateral security. But the i. surety : collateral security. evidence does tend to show that, at the instance of . ,, . . . White, and tor his benefit, and to secure him as a surety for Higginbotham, the note-in question was accepted by McMaken, he agreeing to do the best he could with it, and that with tliis understanding it was placed in the hands of May for collection, and that whatever might be realized from it was to be applied to the satisfaction of the note in suit.

These facts give the Noble and Stoner note the character of collateral security, so far as White is concerned. Upon this point we cannot say that the verdict is not sufficiently supported by the testimony.

II. It is next urged that there is no evidence of negligence on 'the part of the plaintiff, in the surrender of the collateral 2 _._ negligence, in question. From all the testimony it clearly appears that the note sued on became the property of plaintiff long after it was due. At that time he held the Noble and Stoner note for collection, or rather he had placed it in the hands of attorneys for collection, and he held their receipt. He knew the proceeds, when collected, were to be applied to the satisfaction of the note in suit, and he knew that White had signed that note merely as a surety. He delivered over the receipt for the collateral to Higginbotham, the payee, in order that he might collect the note and pay over to him the proceeds. Higginbotham obtained the note from the attorneys, and, instead of collecting it, he sold it and appropriated the proceeds. Whether this conduct on the part of plaintiff was that of ordinary and reasonable prudence or care, was a question of fact for the jury. They have found, under proper instructions of the court, that plaintiff did not act in the premises as a man of reasonable, and ordinary care and caution should have done, and we think the evidence sustains the finding.

III. Stoner was the only responsible party upon the Noble and Stoner note, and he denied his signature. This made the value of the note doubtful. The amount realized upon this note, after deducting attorney’s fees and expenses,’ was only $200, and it does not appear that in the exercise of reasonable care more could have been realized. The note in suit should have been credited only with this sum. At the time of trial, to-wit: December 19, 1873, the amount of the note sued on was $396.66. The verdict should have been for $196.66. If defendants consent to- the rendition of judgment in this court for $196.66, with interest from December 19, 1873, at ten per cent, the judgment will be modified and affirmed at appellee’s costs. Otherwise the judgment must be

REVERSED.