M'Mahon v. Fawcett

14 Am. Dec. 296, 2 Va. 528, 2 Rand. 514, 1824 Va. LEXIS 33
Supreme Court of Virginia·Decided June 11, 1824·Published·Cited by 11 cases

Opinion

JUDGE CARR,

delivered his opinion, in which the other Judges concurred.*

This is au appeal from an interlocutory decree of the Staunton Chancellor. The suit was brought by seven out of seventeen of the sureties of D. Ragan, as deputy Sheriff of Rockingham, against Fawcett and others, the sureties of the same Ragan, in his private capacity. It is a scramble between these two classes of sureties for the wreck of an insolvent’s estate. In canvassing the correctness of the Chancellor’s decree, it may be best to treat the subject in the order he has pursued.

1st Question. Does the trust deed to Garnbill and Fawcett, afford protection to those who were bound 'as sureties with them? The Chancellor thinks not. He places it principally on the ground of contract and intention. The deed clearly on the face of it provides only for the payment by Garnbill or Fawcett; and indemnity to them is its sole object. It gives no lien to the other sureties. They are not even parties to it. And here the case differs in the Chancellor’s opinion, from West v. Belches, 5 Munf. 187; where there was once a lien for the whole debt to both ^sureties, though that lien was after-wards abandoned, by the surety to whom this Court gave protection under it. The examination which I have given to this subject, has conducted my mind to a conclusion different from the Chancellor’s. I think that, both upon principle and authority, the co-sureties have a right to throw the whole burthen of the debts upon the subject mortgaged to one of their body for his security. I do not consider this so much a question of intention or contract, as of the effect of the deed, under [416] the influence those settled principles of equity, which bear upon it. All the obligations given, by Ragan and his sureties, are joint and several. Each is under a several obligation to pay the whole. The creditor may throw the whole burthen upon any one of them. The principal has given to two of the co-sureties, Fawcett and Gam-bill, a deed of trust on land, for their indemnity; and if the whole money be made out of either of them, the land must be bound for the whole, to indemnify them. Here, then, is the property of the common debtor, bound for the debt; and the question is, will not the established principles of equity throw the whole burthen upon that fund, in ease of all the sureties?

There are several rules on this subject, which seem to me connected with each other, and resting upon the same general •grounds. If B. and C. are bound to A. for a debt, B. as principal and C. _as surety, and B. gives C. a mortgage or other lien to secure him, A. can resort to this. 1 Equ. Cas. Abr. 93; 5 Bac. Abr. 168; 11 Ves. 12. Why? Not on the ground of contract, for there is none giving A. a lien; but because it is the property of the debtor, pledged (though not to his credit) for the debt. So it is with the contribution. Our act of Assembly, which gives the right to one surety to call on the others, only reduced to statute law, what had long been the law of equity. The whole doctrine of principal and surety, with all its consequences of contribution, &c., rests upon the established principles of a Court of Equity. There is no express *contract, between the sureties, for contribution. It results from, the maxim, that equality is equity. Again; a surety will be entitled to every remedy which the creditor has against the principal debtor; to enforce every security, and all means of payment; to stand in the place of the creditor, even as to securities entered into, without the knowledge of the surety; having a right to have these securities transferred to him, though there was no such stipulation, "and to avail himself of all those securities against the debtor. And the creditor can do' nothing to invalidate or discharge the security he has taken from the principal debtor, to the prejudice of the rights of the surety; and if he has done such act, and disabled himself from transferring these securities to the surety, he will (unless in so doing he acted without knowledge of the other’s rights, and with good faith, and just intention) he precluded from so much of his demand against the surety, as this latter might have procured, if the transfer could have been made; and all this, not upon the ground of contract, but upon a principle of natural justice; the same which regulates the doctrine of contribution among sureties. The creditor may resort to either for the whole, or to each for his proportion; and as he has that right, if he, from partiality to one surety, will not‘enforce it, the Court gives the same right to the other surety, and enables him to enforce it. For these principles, I refer generally to Poth. on Oblig. No. 437, 496, 519, 530; 3 Vern. 608; 2 Ves. 622; 3 Madd. Ch. Rep. 437; 10 Ves. 412; 11 do. 22; 14 do. 162; 1 Johns. Ch. Rep. 412; 2 do. 554; 4 do. 130; 2 Bos. & Pull. 270.

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M'Mahon v. Fawcett, 14 Am. Dec. 296, 2 Va. 528, 2 Rand. 514, 1824 Va. LEXIS 33 (Va. 1824).

14 Am. Dec. 296 (M'Mahon v. Fawcett) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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