Nazarkiewich for fifteen fully paid-up shares in the company, of £250 each, four acceptances for £250 each of the company, dated the 26th of June, 1874, at thirty days, four months, six months, and nine months, respectively, and £190 in cash, "in part discharge of our claim of £6,000, and provided the above bills are paid at maturity, we agree to release our charge or interest in the book debts of Mr. Nazarkiewich." The defendant was chairman of the company, but he did not agree to the repurchase and transfer to the company of Nazarkiewich's book debts. Issue, and demurrer and joinder to the 7th and th pleas. At the trial before Denman, J., at the last Michaelmas Sittings in Middlesex, the facts above set out were proved, and a verdict for the plaintiffs was taken by consent for the dainages in the declaration, with leave to the defendant to move to enter it for him, or to reduce the damages to such sum as the court might direct; the court to draw all necessary inferences of fact. The demurrer was dropped, all the points being considered upon the argument of the motion. The declaration in the first count set. Held, We think the defendant is enout the agreement of the 20th of De-titled to judgment. It was argued that cember, 1873, between the plaintiffs and he was discharged as surety, and that Nazarkiewich, and the guarantee of the was made out by the facts. defendant to the plaintiffs of the same date, and averred that Nazarkiewich. had caused shares in the company to the nominal value of £3,750 to be issued to the plaintiffs, and that they had not been redeemed. To say that a person becoming aware that another person is going to do something, which, if done, will discharge him from his contract, is therefore bound to warn him of the consequences of his doing it, is not a tenable propo The second count contained an addi-sition. tional averment that the plaintiffs, by the authority of the defendant, assign ed their interest in the book debts to the company. That brings it round to the question whether, on the facts, what has taken place has had the effect of discharging the surety. Upon that it has been established for a very long The defendant in his pleas traversed time, beginning with Reese v. Berringvarious allegations in the declaration, ton, 2 Wh. & Tud. 4th ed. p. 974, and but the only pleas material to this re- downwards, that a surety is discharged port were the seventh, upon equitable by giving time, upon the principle that grounds-that the defendant was dis- a creditor, whe, without his consent, charged by the agreement between the gives time to the debtor, deprives the plaintiffs and Nazarkiewich for the surety of his remedy, viz, to use the transfer by the plaintiffs of their inter name of the principal creditor to sue est in Nazarkiewich's book debts to the the debtor. If that is suspended for a company--and the eighth, upon equi day, or even an hour, although the sureHe grounds-that the defendant was ty is not injured, and possibly may even discharged by the material variation have been benefitted, nevertheless it is without his knowledge of the terms of established that that discharges the the agreement set out in the declara- surety. Whether that is a just principle is a matter it is far too late now to tion. think about; but from the time of able to the order of one C. The draft Rees v. Berrington it has been unques was drawn for $27, and after its delivtioned, and has been said so many times ery to the payee it was fraudulently althat nothing but the legislature can tered to $2,750, and was afterwards make any alteration. Now in the pres-presented to and accepted by the plainent case it is not by giving time, but tiff. The forged draft was sent by one there has been an equal interference H., of Baltimore, to A. B. & Co., of with the rights of the surety. He had New York city, in a letter received by the right to have the book debts to look them, Aug. 16, 1869, asking for a sterto as his security; that right he has ling bill of exchange, at sixty days, on been deprived of by releasing the book London, for the amount of $2,750. A. debts by the wilful act of the plaintiffs. Taking it as it stands here, it seems to me the defence is made out, and the defendant is entitled to judg ment. B. & Co. deposited the draft on the day it was received, in defendant's bank, with other checks and drafts, and were credited with the amount of it. The draft was presented to plaintiff's, who Opinion by Blackburn, J.; Mellon accepted it, payable at the Leather and Quain, J.J., concurring. NEGOTIABLE PAPER. FORG- N. Y. COURT OF APPEALS. Manufacturer's Bank. It was presented there and certified, and was paid by said bank, through the clearing house, in regular course of business. A. B. & Co., on Aug. 16th, sent a bill of exchange on London. for the full value of White et al, applts., v. The Conti- the draft, to H., by mail. Plaintiff's nental National Bank, respt. were not advised of drafts drawn upon them by W., except by the presentation Decided March 21, 1876. thereof for payment, and they were The drawees of a bill of exchange are not notified of the alteration in the draft only held to a knowledge of the sig until October 6th, when they gave nonature of the drawer; and in accepting and paying a bill which has been tice to defendant. The court, at the fraudulently raised after delivery to trial, left it to the jury to say whether the payee, they merely vouch for the defendant could have saved itself from genuineness of the signature of the loss if it had known of the forgery on drawer, and may recover back from the 17th of August, and charged that the holder whatever they may have paid over the amount of the bill as if, by relying on the acceptance and originally drawn. payment of the draft by plaintiffs, The holder of such a raised bill is held the defendant has lost an opportunity to a knowledge of his own title, and of protecting itself, it was entitled to a of the endorsements of the bill prior verdict. The jury rendered a verdict to his. for the defendant. This action was brought to recover $2,750, and interest thereon, from Aug. Hamilton Odell, for applt. 18, 1869, received by defendant upon a Wm. Allen Butier, for respt. sight-draft, dated Aug. 9, 1869, drawn Held, error; That defendant acted by one W., at Buffalo, on the plaintiff's upon other evidence of its right to the banking firm, in New York city, pay-money than the statement or actions of plaintiffs; in dealing with the bill and Judgment of general term, aflirming its avails it acted upon the apparent judgment on verdict for defendant retitle and genuineness of the instru-ersed, and new trial granted. ment, and the responsibility of those from and through whom they received it; plaintiff's therefore owed no duty to defendant in respect to the former; and that plaintiffs owing no duty, and making no misrepresentations could not be chargeable with negligence which could defeat their right to reclaim the money paid, and there was no estoppel to bar this action. (3 Comst., 230; 40 N. Y., 391; Continental Nat., Bk. v. Nat Bk. of Comm., 50 N. Y., 575, distinguished.) Opinion by Allen, J. ACCOUNT STATED. N. Y. SUPREME COURT. GEN'L TERM. William Barker, admr., applt. v. Where an account stated is plead in defence to an action, and plaintiff avers that it was made at defendant's request to influence the action of another, but without effect, and that the accounts were in fact still open, it should go to the jury as to whether the account was in fact still open. Appeal from judgment dismissing the complaint at special term. Plaintiff's intestate, Smith Barker, Plaintiffs, as drawers of the bill, were only held to a knowledge of the signature of their correspondents, the drawers; that by accepting and paying the bill they only vouched for the genuineness of such signatures, and were not held to a knowledge of a want of genuine- had for some years been executor and ness of any other part of the instru-trustee of one John Peutz. In June, ment, or of any other names appearing 1872, said Smith Barker died, leaving thereon; or of the title of the holder. the estate of Peutz largely indebted to (9. M. & W., 54; 46 N. Y., 77; 10 him for moneys expended in its behalf, Wall., 604; 18 id.. 604; 4 Comst., 147.) commissions, &c. Subsequently defendThat defendant is held to a knowledge ant was appointed trustee of said estate. of its own title, and the genuineness of This action is brought to recover said the indorsements, and of every other indebtedness. The answer, by way of part of the bill other than the signature defence sets up an account stated, signof the drawers within the general prin- ed by plaintiff, as administrator, &c., of ciple which makes every party to a prom-the Peutz estate. Plaintiff replies that issory note or bill of exchange a guar after the death of the intestate, and beantor of the genuineness of every pre-fore the appointment of another trustee, ceding indorsement, and of the genu- the account was prepared at the request ineness of the instrument. (15 N. Y., and with the assistance of defendant, 575; 40 Id., 456; Story on Notes, who dictated the same. 135, 379-381.) The presentation of the bill, and the demand and receipt of the money thereon were equivalent to an indorsement. The drawees had a right to act upon the presumptive own ership of the defendant as the apparent holder. That defend ant prepared it for the purpose of inducing one Townsend to qualify as trustee of Peutz's estate, as Townsend had refused to qualify until he knew how the accounts between the two es tates stood. That as an inducement for his signing it, the defendant had promised that there should be a full accounting, so soon as a trustee should be appointed. Townsend eventually refused to qualify, and defendant was appointed trustee instead. At the trial the complaint was dismissed, and judgment rendered for the defendant on the pleadings. Rowan & Hehn, for applt. Held, That the account appears to have been made in accordance with defendant's wish, in order to induce Mr. Townsend to qualify. This object being known, it was wrong in plaintiff to have assented, but yet, in fact, it did no wrong to Mr. Townsend, because he did not qualify. A promissory note, actually made and A contract for a loan of money at a The action in this case was brought by plaintiff as holder of a promissory note made by the defendants, Smoot Plaintiff does not seek any benefit and Pomeroy, bearing date on the 27th from the arrangement, made in refer- of November, 1873, for $7,000, which ence to Mr. Townsend, or to urge any note was made payable to the order of claim or demand which was not reserv- the defendant, Darling, at the Second ed between him and defendant when National Bank, Leavenworth, Kansas, that arrangement was made. His claim, with 12 per cent. interest until paid. if it really exists, is in nowise connect- This note thus made and endorsed was ed with, nor does it grow out of this transferred by indorsement to the plainarrangement, and therefore the maxim, tiff. "That where one of two wrongdoers The cause was tried at the circuit seeks an advantage from the unlawful court, and resulted in a verdict for the combination, the defendant is in the better position," does not apply. The issue presented, as to whether in fact, the accounts are still open, should have been tried. Defendant was not entitled to judgment on the pleadings. Judgment reversed. Opinion by Brady, J.; Davis, P.J., and Daniel, J., concurring. USURY. DISCOUNT. SUPREME COURT, DISTRICT OF COLUMBIA. GENERAL TERM. The Second National Bank of Leay enworth v. Samuel Smoot and others. Decided January, 1876. plaintiff. Sometime before 1873, Smoot, one of the defendants, obtained a loan from the plaintiff. (Second National Bank, Leavenworth, Kansas,) of $20,000.. This loan of $20,000 from the bank was secured by the promissory notes of Smoot and Pomeroy, These notes were given, one for $8,000, one for $7,000 and one for $5,000, were made payable on time, executed and sent from Washington, D. C., to the bank in Kansas; and the bank paid to the defendant, Smoot, the proceeds much less per annum than the rate allowed by the law of Kansas. of these notes, less the discount for the time they had to run, at the rate of 12 per cent. per annum; the rate of inter- 2. That by the arrangement entered est agreed upon in the notes was 12 per into by which the discount was taken cent. per annum after the maturity of out of the proceeds of these notes, the notes until paid. Twelve per cent. whether of original or renewals, the per annum being the highest rate of in-contract was usurious. terest allowed by law to be taken for 3. That some one or more of the rethe loan of money in the State of Kan-newal notes were made payable in the sas. These notes not being paid at ma-city of New York, in which State the turity, some or all of them, new notes law allowed, upon contracts made by were given in renewal, and the new its citizens to be performed within the notes secured the payment of the State, a rate of interest not to exceed amount due, including principal and 7 per cent. per annum. interest, at the rate above mentioned. Held, No valid contract was made for this loan of $20,000, until the notes offered as a security for its payment were accepted by the plaintiff, and the money advanced upon them. Thus went on the dealings between Smoot and the bank until all of the loan of $20,000, and interest thereon was paid, except a note for $7,000, dated the 27th of November, 1873, To take out interest in advance, is payable 90 days after date at the bank discounting a note without regard to in Kansas, made by Smoot and Pome- the rules of rebate or discount, and roy and indorsed by the other defend- there is no distinction between bankers ant, Darling, upon which note this suit and others. is brought. The plea interposed was the general issue. Under that issue was attempted to be tried whether, if the loan was not usurious in its inception, it did not become so by the arrangements that were made on the renewal of the various notes that were given. That a contract for a loan of money at a rate or interest which is legal in a State where the contract is made and where the loan is to be advanced, though the money is to be repaid in a State where the rate of interest is lower, is not usurious, provided it be not a mere device to evade the The defense relied mainly on three laws of the State where the money is to be repaid. propositions: 1. That the notes given to secure the original loan of $20,000, being actually made and signed in this city and sent to Bank of Leavenworth, and by it discounted, it was a contract made in The judgment of the court below must be affirmed with costs. Opinion by Olen, J. SALE. Washington, and not in Kansas, and N. Y. SUPREME COURT. GENERAL Term, FIRST DEPT. that the law upon the subject of usury Alexander et al., applts. v. Fowler, respt. |