Hendrick v. Lindsay

ERROR to the Circuit Court of the United States for the Northern District of New York.

In March, 1871, one Ballantine recovered a judgment in the Circuit Court of the United States for the Eastern District of Michigan against the Albany Insurance Company, for $3,425.34 and costs. That company desiring to bring the case to this court upon writ of error, Hendrick, its vice-president, on the 8th of March, 1871, wrote to Lindsay, one of the defendants in error, as follows:--

'A. G. LINDSAY, Esq., Detroit:

'DEAR SIR,-Will you be good enough to sign the needful bail-bond in the 'Park' case, and oblige

'Yours truly,

JAMES HENDRICK, V. P.'

On the 10th of that month, Lindsay replied: 'I beg to say that I will sign the bail-bond in the 'Park' case, if you will first furnish me with sufficient security to indemnify me in case of our defeat; the case may be delayed years at Washington, and many changes may occur in that time.'

On the next day Hendrick wrote to Lindsay, acknowledging the receipt of the letter of the 10th, and saying, 'Whatever security may be desired in the shape of a personal bond, I will give it to you.' After the receipt of this letter, the defendants in error executed to Ballantine their joint and several bond, which was accepted, approved, and filed on the sixteenth day of March, 1871; whereupon the insurance company sued out a writ of error, by which, and in virtue of the bond, said judgment was superseded.

On the 15th of March, 1871, Hendrick wrote to Lindsay, saying as follows:--

'I have just returned from Boston, and learn that you have not yet advised us of having signed our bail-bond in the 'Park' case. As it should be done at once, I hope you will feel that we have, if nothing more, a feeling of old friendship, that ought to make men of us in an hour of need.'

On the 17th, Lindsay replied,--

'Upon receipt of your favor of the 11th inst., I signed your bond in 'Park' case without loss of time, and supposed the fact itself was answer to you in the premises until this A.M. I received yours of the 15th inst., touching on the same subject, and now ask your pardon for not stating to you at once, upon the receipt of your 11th inst. favor, that the bond was executed.'

On the 20th, Lindsay again wrote as follows:--

'DEAR SIR,-Enclosed is bond of indemnity, which please have executed and returned to me.'

The bond was as follows:--

'Know all men by these presents, that we, James Hendrick, as principal, and _____, as surety, of Albany, in the State of New York, held and firmly bound unto Archibald G. Lindsay and James P. Mansfield, of the city of Detroit, county of Wayne, and State of Michigan, in the sum of $5,500, lawful money of the United States of America, to be paid to the said Lindsay and Mansfield, or to their certain attorneys, heirs, executors, administrators, or assigns, to which payment, well and truly to be made, we jointly and severally bind ourselves, our heirs, executors, and administrators, and each and every of them, firmly by these presents, sealed with our seals, dated the twentieth day of March, 1871.

'The condition of this obligation is such, that, whereas the said Lindsay and Mansfield have lately, at the request of the said Hendrick, signed two bonds,-one in the sum of $5,000, and one in the sum of $200,-in a case pending in the Circuit Court of the United States for the Eastern District of Michigan, in which suit James M. Ballantine was plaintiff, and the Albany City Insurance Company was defendant, said bonds being filed for the purpose and intent of taking said case to the Supreme Court of the United States.

'Now, therefore, if the said Hendrick shall save and keep the said Lindsay and Mansfield fully indemnified and harmless against all loss, damages, or expenses arising from their giving the said bonds, then the above obligation to be void; and otherwise, in force.'

No dissent was expressed by Hendrick, nor was the bond executed by him.

Ballantine's judgment having been affirmed by this court, Lindsay and Mansfield paid it by their negotiable notes, and thereupon brought assumpsit against Hendrick for the amount so paid.

The plaintiffs, after proving the foregoing facts, rested their case. The defendant announced that he had no evidence to offer.

The court charged that the plaintiffs were entitled to recover, and directed the jury to so find; to which charge and direction the defendant excepted.

The jury found a verdict for the plaintiffs; and judgment having been rendered thereon, the defendant sued out this writ of error.

Mr. T. Lawson for the plaintiff in error.

The undertaking of a surety is to be strictly construed, and should not be extended to any other subject, person, or period of time than is expressed in the obligation. Birge on Suretyship, 40; Birkenhead et al. v. George et al., 5 Hill (N. Y.), 634; Barns et al. v. Barron, 61 N. Y. 39; Miller v. Stewart, 9 Wheat. 703; Ludlow v. Simonds, 2 Caines's Cas. 1; Lord Arlington v. Merrick, 3 Saund. 400; Grant v. Naylor, 4 Cranch, 224; Bleecker v. Hyde, 3 McLean, 279; Wright v. Russell, 3 Wils. 530; Weston et al. v. Barton, 4 Taunt. 726; Strange et al. v. Lee, 3 East, 484; ''Chancellor, &c. of Cambridge v. Baldwin, 5 M. & W. 580; Day v. Davey'', 2 Per. & Dav. 249; London Assurance Co. v. Bold, 6 Adol. & Ell. N. S. 514.

In order to entitle the plaintiffs to recover, they were bound to show payment and discharge of the liability or debt. Bonny v. Seeley, 2 Wend. 482; Powell v. Smith, 8 Johns. 248.

The giving of one's own note will not, unless it is expressly so agreed, operate as payment or discharge of a prior debt or obligation. The Kimball, 3 Wall. 37; Downey, Ex'r, v. Hicks, Ex'rx, 14 How. 240; Drake v. Mitchell, 3 East, 250; Tobey v. Barber, 5 Johns. 68; Johnson v. Weed, 9 id. 309; Wetherby v. Mann, 11 id. 516; Van Ostrand v. Reed, 1 Wend. 424.

Mr. Walter H. Smith for the defendants in error.

A party occupying the position of a surety who gives his negotiable note, which is accepted in satisfaction of a debt or obligation, can maintain an action against his principal. Wetherbee v. Mann, 11 Johns. 518; Rodman v. Hedden, 10 Wend. 501; Elwood v. Deifendorf, 5 Barb. 410; Van Ostrand v. Reed, 1 Wend. 430.

The promise of the plaintiff in error to indemnify, under the circumstances, entitled the defendants in error to maintain their action. Elwood v. Deifendorf, supra; 1 Story's Eq. Jur., sect. 499.

The true construction of the undertaking of the plaintiff in error to indemnify the sureties is to be found in the intention of the parties. Gates v. McKee, 13 N. Y. 232; Nash v. Towne, 5 Wall. 699.

Although Mansfield's name was not mentioned in the letters to Hendrick, yet if the promises and undertaking of the latter were intended to inure to the benefit of any person or persons whom Lindsay might procure to sign the bail-bond, then such person or persons can, at common law, sue directly and in his or their own name, in assumpsit. Chitty, Contr. 54-58, and cases cited.

MR. JUSTICE DAVIS delivered the opinion of the court.