President of Bank of Wilmington & Brandywine v. Houston

1 Del. 225

• Court: Superior Court of Delaware
• Decided: July 5, 1833
• Status: Published

Opinion

The Court stopt the other side.

Clayton C. J.

—This action is against Houston as an indorser, and the notes offered in evidence do not themselves show any connection or liability of the deft. ■ It appears by other evidence that three notes were drawn by Jos. Roberts in favor of certain persons and indorsed by them, and also by Houston to the bank. Houston afterwards made an agreement with the bank in relation to the renewal of these notes. This is an undertaking to indorse, or an agreement to hold himself responsible as an indorser; ip either case he is liable, but liable on the agreement. The action should have been on this agreement specially setting it out; it might have been done in this case by adding a count to that effect. It has been contended that this was an authority given to the bank to indorse these notes for the deft. We admit that this authority may be made out by inference—by the.course of trade, as where a wife was accustomed to indorse for her husband—but here is a written agreement and we cannot go beyond it. It gives no such authority. The party agrees to be bound as much as if he had indorsed the notes, but he does not indorse them nor authorize another to indorse for him. He is not then an indorser though liable as much as an indorser; but how liable? Not on the notes, for this would make him an actual indorser, but on the agreement. A distinction is taken in the books be tween the acceptance of a bill drawn and one to be drawn; in the former case it may be by collateral writing, but in the latter, not. Here, this agreement is in relation to notes to be drawn in future: and the case is stronger than that of an acceptor, for the indorser is quasi a new drawer. We are therefore of opinion that the evidence offered is inadmissible in this action.

The plffs. then proved the notes of the 30th June 1831, and the indorsement by Houston of those notes. That these notes were running when the agreement aforesaid was made, that the notes in question were discounted on the faith of that agreement and were but renewals of the old notes. That the old notes were cancelled, but they were not paid otherwise than by the new notes. They also gave in evidence the official bond of Jos. Roberts as prothonotary of the late court of Common Pleas; certain proceedings showing that money to which the plff. was entitled was paid into court, and for which Roberts was responsible; and they further proved that Houston was the surety of Roberts in his official bond, and that these notes were discounted to enable him to pay this money to plffs. for which he was then responsible as prothonotary.

The plff. now offered all the notes and the agreement as evidence under the money counts. Objected to.

Rogers.

—In order to support an action for money had and received, the plff. now resorts to the original notes of June 1831, which have been paid off and discharged. When a note is declared on and also money counts added, the only way the money counts can be sustained is by the production of the notes. You may sometimes be unable to prove all the requisites to charge an indorser as such, and may yet recover on the money counts, but it can only be by giving the notes in evidence and connecting them with a consideration. The notes of March 1832, have no bearing upon Houston: he is not a party to them; they are not evidence in this cause, and the original notes have been paid. They bear the bank’s stamp of discharge.

Bayard.

—In the money counts we are not bound by the special contract. If we can show value received, money advanced, or consideration existing between the parties we can recover. We here show a consideration. The liability of Houston as surety for Roberts in his official bond. Money paid into court and ordered to be paid to plffs. The notes discounted on account of this liability. The money was advanced then for the benefit of Houston the surety as well as for Roberts, and by his consent and agreement.

“The Court thought the evidence not sufficient for the plffs. to recover under the money counts. Houston was the surety, together with Price, of Roberts in his official bond. Any liability which he had incurred on that bond was divided by Price. His condition was in no wise bettered, but rendered worse by the discounting of these notes. No consideration of advantage therefore passed to him. To hold him liable on the money counts would be to dispense with the provision that was made in his agreement that Margaret Booth, P. B. Dulany and E. H. Thomas, should also indorse, which be made a condition precedent. He is liable on his agreement and not otherwise.”

Bayard and Wales, for plaintiff. Booth, Read, jun. and. Rogers, for defendant.

It is now settled that the plff, can in no case recover under thé count for money had and received unless money has actually been received, and for the use of the plff. 1 East 434; 1 Camp., 175; Chitty 366.

If the drawer has been discharged from liability upon the bill by the loches of the holder, the latter cannot recover on a count for money had and received. Chitty 364.

The plaintiffs suffered a nonsuit.