Moses v. National Bank of Lawrence County/Opinion of the Court

By the statute of frauds of Alabama a special promise to answer for the debt, default, or miscarriage of another is void, 'unless such agreement, or some note or memorandum thereof, expressing the consideration,' is in writing, and subscribed by or in behalf of the party to be charged. Code Ala. 1887, § 1732. The words 'value received,' or acknowledging the receipt of one dollar, sufficiently express a consideration. Neal v. Smith, 5 Ala. 568; Bolling v. Munchus, 65 Ala. 558.

Every negotiable promissory note, even if not purporting to be 'for value received,' imports a consideration. Mandeville v. Welch, 5 Wheat. 277; Page v. Bank, 7 Wheat. 35; Townsend v. Derby, 3 Metc. (Mass.) 363. And the indorsement of such a note is itself prima facie evidence of having been made for value. Riddle v. Mandeville, 5 Cranch, 322, 332.

The promissory not in the case at bar, having been made payable to the maker's own order, first took effect as a contract upon its indorsement and delivery by the maker, the Sheffield Furnace Company, to Witherow, the first taker. Lea v. Bank, 8 Port. (Ala.) 119; Little v. Rogers, 1 Metc. (Mass.) 108; Hooper v. Williams, 2 Exch. 13; Brown v. De Winton, 6 C. B. 336.

A guaranty of the payment of a negotiable promissory note, written by a third person upon the note before its delivery, requires no other consideration to support it, and need express none other, (even where the law requires the consideration of the guaranty to be expressed in writing,) than the consideration which the note upon its face implies to have passed between the original parties. Leonard v. Vredenburg, 8 Johns. 29; D'Wolf v. Rabaud, 1 Pet. 476, 501, 502; Nelson v. Boynton, 3 Metc. (Mass.) 396, 400, 401; Bickford v. Gibbs, 8 Cush. 154; Nabb v. Koontz, 17 Md. 283; Parkhurst v. Vail, 73 Ill. 343.

The demurrers to the fourth and fifth pleas, therefore, were rightly sustained.

But a guaranty written upon a promissory note, after the note has been delivered and taken effect as a contract, requires a distinct consideration to support it; and, if such a guaranty does not express any consideration, it is void, where the statute of frauds, as in Alabama, requires the consideration to be expressed in writing. Leonard v. Vredenburg, and other cases, above cited: Rigby v. Morwood, 34 Ala. 129.

The demurrer to the twelfth plea, therefore, should have been overruled, and judgment rendered thereon for the defendant, unless the court saw fit to permit the plaintiff to file a replication to that plea.

It was argued in behalf of the original plaintiff that the validity and effect of the guaranty must be governed by the general commercial law, without regard to any statute of Alabama. But there can be no doubt that the statute of frauds, even as applied to commercial instruments, is such a law of the state as has been declared by congress to be a rule of decision in the courts of the United States. Act Sept. 24, 1789, c. 20, § 34, (1 Stat. 92;) Rev. St. § 721; Mandeville v. Riddle, 1 Cranch, 290, and 5 Cranch, 322; D'Wolf v. Rabaud, 1 Pet. 476; Kirkman v. Hamilton, 6 Pet. 20; Brashear v. West, 7 Pet. 608; Paine v. Railroad Co., 118 U.S. 152, 161, 6 Sup. Ct. Rep. 1019.

It was also contended that the order sustaining the demurrers, if erroneous, did not prejudice the defendant, because he might have availed himself of the defense of the statute of frauds under the general issue. That might have been true, if he had pleaded the general issue. Kannady v. Lambert, 37 Ala. 57; Pollak v. Kannady v. Lambert, 446, 9 Sup. Ct. Rep. 119. But he did not plead it, and had the right to rely on his special pleas only. Code Ala. § 2675.

The suggestion of counsel mat by the practice in Alabama the entry of an appearance of counsel for the defendant was equivalent to filing a plea of the general issue, is too novel to be accepted without proof, and seems inconsistent with Grigg v. Gilmer, 54 Ala. 425. If the record did not show what the pleadings were, it might be presumed that the general issue was pleaded. May v. Sharpe, 49 Ala. 140; Hatchett v. Molton, 76 Ala. 410. But in this case 12 pleas are set forth in the record, and it cannot be assumed that there was any other.

The eighth plea was payment. The defendant introduced no evidence to support this plea, and has, therefore, no ground of exception to the rulings and instruction at the trial of the issue joined thereon.

But the erroneous ruling on the demurrer to the twelfth plea requires the judgment to be reversed, and the case remanded to the circuit court for further proceedings in conformity with this opinion.