Reid v. Flippen

47 Ga. 273

• Court: Supreme Court of Georgia
• Decided: July 15, 1872
• Status: Published

Opinion

McCay, Judge.

The note sued on is a joint and several note. The holder had the right to sue all or either of the parties to it, at his pleasure. He saw fit, before the statutory bar attached, to sue the securities only. This he had a right to do, by the very terms of the contract; nor has it ever been held that it is any wrong to the principal to fail to bring suit against him at the same time as suit is brought against the surety. True, under our law, if this be done, and a judgment be got against the principal, the surety, if he pay the money, has a right to use the judgment against the principal, but this is an advantage which comes to the surety by an act of the holder, which he may or may not do, at his option. The surety has always the right, by notice under the Code, to compel suit against the principal, but if he neglect to give the notice, he cannot complain. As we have said, the plaintiff had an undoubted right of action against the securities, alone, when this suit was brought. Does the fact that, since the bringing of the suit, the statute of limitations has barred a suit by the plaintiff against the principal destroy this right against the securities ? The foundation of all the rules discharging the surety for acts or neglect of the creditor is, that these acts have injured the surety. And if the neglect of the creditor to sue the principal until the statutory bar attaches so operated as to injure the surety, I should hesitate to hold the surety bound. But, in our opinion, the attaching of the statutory bar between the principal and the creditor does not injure the security. If he be still bound and has the debt to pay, the right to recover the money paid out of the principal still exists, notwithstanding the note, the obligation to the creditor, be barred. The right of the surety arises from the date of the payment. He has no right of action until then, and his right is not on the note or original debt, but on his having paid the money for the principal’s use. At the making of this original note, there was raised by the law a contract between the principal and sureties to the effect that if they, or either of them, paid the debt, he, the principal, would repay it. Until either of the sureties has paid the debt, no right of action accrues.

We derided in the case of Ezzard vs. Worrill, 44 Georgia, 629, that a surety who since 1865 had paid the principal’s debt, contracted before 1865, did not become a creditor of the principal until the actual payment, and this though the debt was in judgment against both parties. The truth is, the payment of a note by the surety discharges it, and the action by the surety is not on the note, but for money paid. The rule is laid down in the English text books: Pitman, 196, 197; see also, Theobald on Principal and Security, on same point, without qualification, that mere delay to sue the principal does not discharge the surety. And this very sensible reason is given, that the surety has always the right to pay and sue himself: See also, the same rule in: '2 American Leading Cases, 255, and note of authorities there cited. It is true, none of those cases, so far as we have been able to examine them, are cases where the delay had resulted in the attaching of the statutory bar in favor of the principal. But the principle upon which all these cases go, is that the act of the creditor which releases the security must be some act which prevents the security irom his right to pay. and sue the principal himself. In Ker vs. Brandon, 2 Howard, (Mississippi,) 910, and in Johnson vs. The Planters’ Bank, 4 Smead & M., 170, it was held that the failure of a creditor to present the debt to the administrator of the principal within the time required by the statute of Mississippi for presenting debts to an administrator, did not discharge the surety, and this, though by the law of Mississippi, a debt not thus presented is not payable out of the assets. And this has also been held in New Hampshire: 8 New Hampshire Reports, 389. There are some remarks by me in the case of Turner vs. McCarthy, 42 Georgia, 491, indicating a different opinion from the present decision. That case, however, stands on peculiar ground, and I am myself now satisfied that my reasoning there.is not sound.

2. We think the Court erred in his charge to the jury on this point. We find no authority for the qualification daid down by the Judge. A vendee of personal property has a right to rely on the representations of the seller. If they are of such a character as to deceive, and he is deceived, the seller is liable for his deception. True, if the statements are so palpably false as that they could not deceive or mislead, they are not actionable; but this is rather matter of evidence than of law. If the buyer is, in fact, deceived by his trust in the seller’s word, he has been damaged by his act. It is going too far to say that, in a sale, the buyer must look out for himself, and that he has no right to rely on the statements of the seller. A very large number of men, especially when they come to buy a horse, do not pretend to examine and trust altogether to the statements of the seller. We have looked pretty diligently, and can find no authority for this qualification to the general rule, that if the seller makes false statements, and they deceive the buyer in a material matter, he is liable for his deceit.

. 3. It would be grossly unfair to exclude the payee in this note, when the defendants who signed it are witnesses. The reason of the exception in the evidence Act is, that one party to a contract ought not, in a suit in which the other party (who is dead) is interested, be permitted to give his sworn statement when he cannot be met by the other side. Here, two of the original eontractoi’s are living, one of them was sworn, and all the reason of the law fails. The dead man’s estate is not a party; this judgment does not bind it. The question on trial is between the plaintiff and the defendants, and they are all alive.

Judgment reversed.