Caulfield v. Finnegan , 114 Ala. 39 ( 1896 )

BRICKELL, C. J —

The assignments of error relate to all the rulings of the court below, on the demurrers to the original and amended complaints, but the argument of counsel for the appellants is devoted exclusively to the rulings on the demurrer to the third, or last amended complaint, and it is to these only we will direct consideration.

The abstract states that this count describes the note, as in former counts. Adopting a liberal interpretation of the statement, we have referred to the former counts, as set out in the abstract, for a description of the note, and of the indorsement or assignment thereon, the foundation of the suit. These are, perhaps, stated with more of fullness, in the first amended complaint, than in any of the other counts. That count or complaint, purports to set out in haec verba the note, and the indorsement or assignment thereof by-the defendant. The note bears date May 20, 1890, is an' ordinary non-negotiable promissory note, signed by C. M. Porter as maker, for the payment of three hundred and twenty dollars to the defendant, one day after the date thereof, containing a waiver of exemptions, and a stipulation to pay attorney’s fees for collecting. The endorsement or assignment thereof, made by the defendant, was made, it is averred, in November, 1892, and is in these words : “I hereby transfer the within note to Hop Caulfield and wife, for a valuable consideration.”

The general indorsement or assignment of paper not negotiable according to the law merchant, like the indorsement of paper negotiable, imports a contract or engagement, in its nature and essence conditional; and the conditions upon which it may be converted into an absolute undertaking or engagement, are prescribed by the statute. — Code of 1886, §§ 1778-80. When, as in the present case, the amount due on the paper assigned, exceeds one hundred dollars, the condition is, suit against the maker to the first term of the court of the county of his residence, to which suit may be properly brought, unless the time for bringing suit has been extended or waived by the consent of the indorser or assignor in writing, signed by him ; or unless suit is excused because of the existence of some one of the categories enumerated in the several sub-divisions of section 1780 of the Code. In an action founded on the indorsement or assignment, the complaint must aver performance of the condition, or the particular causes relied on as relieving from the duty of performance, freeing the indorsement or assignment from' its conditional quality, converting it into an absolute engagement. — Ryland v. Bates, 4 Ala. 342; Lindsay v. Williams, 17 Ala. 229; Suggs v. Winston, 49 Ala. 586; Mobile Savings Bank v. McDonnell. 83 Ala. 585. Without such averments, the complaint would not only be subject to demurrer, but it would not contain a substantial cause of action, which, on error, would support a judgment against the assignor or indorser. — Cook v. Mut. Ins. Co., 53 Ala. 37. The statute creates the condition on which the liability of the indorser or assignor depends, and the facts or categories upon which performance of the condition may be excused ; there can be no exceptions engrafted on the statute ; no departure from, or modification of, its terms.

Without an averment of suit against the maker, by the averment of facts and transactions occurring between the parties, the purpose is to excuse the failure to sue, bringing the case without the operation of the seventh sub-division of section 1780 of the Code. The words of the sub-division are : ‘ ‘When, by any act or promise of the indorser, the plaintiff is induced to delay bringing such suit.” Facts and transactions occurring before the expiration of the time for bringing suit, are commingled in the complaint, with facts and transactions of subsequent occurrence; they are, however, readily distinguishable. The death of the maker, as the complaint avers, happened about May, 1893. Courts take notice of the time of the holding of other courts prescribed by the statute, and we, therefore, know that the first term of the circuit court of the county of Jackson, (the county of the residence of the maker), after the assignment of the note, commenced on the 5th Monday after the 4th Monday in January, 1893, anterior to the death of the maker. — Lindsay v. Williams, 17 Ala. 229. It is apparent from the mere reading of the sub-division, first introduced into the statute by the present Code, that the act or promise inducing the delay of suit, must have been done or made before the expiration' of the period for bringing suit. It is only such acts or promises, operating on the mind of the holder of the paper, which could have induced the delay of suit; and it is delay of the suit the statute requires, suit to the first court in the county of the residence of the maker, to which the subdivision refers. The averments of the facts and trans-' actions occurring before the period of suit elapsed must be separated from the facts and transactions of subsequent occurrence ; for it is these alone which could have induced the delay of suit.

As recited in the complaint these facts and transactions are, that one of the plaintiffs said to the defendant, that, “she did not believe anything could be made out of C. M. Porter, and defendant said he did not expect them to try to make anything out of C. M.' Porter ; that he did not want them to look to C. M. Porter for the payment of the note at any time ; and requested them never to try to make it out of the maker of the note under any circumstances, but that he wanted them to agree to do him the favor of waiting for the money until C. M.' Porter died, and let Hop Caulfield try and see if Mrs. C. M. Porter would not pay it out of the insurance money that he understood she was to receive when C. M. Porter died; and plaintiff agreed to do that.” If the paper was a negotiable promissory note, and the inquiry was, whether the indorser had waived presentment to and demand of payment from the maker, and notice of the default, the solicitation of the indorser that the note should not be presented to the maker for payment, would have constituted a waiver, rendering the indorser liable, as if these prerequisites to his liability had been observed by the holder. This is upon the obvious principle, that as the presentment, demand and notice are intended for the benefit of the indorser, he may waive them, as parties to contracts may waive or renounce the benefit of any stipulation designed for their peculiar protection. Story on Bills, § 371; Edwards on Bills & Notes, 595 ; 2 Dan. Neg. Ins., § 1090; Sheldon v. Horton, 43 N. Y. 93 ; s. c. 3 Am. Rep. 669. A waiver, in a general sense, is the voluntary and intentional abandonment, renunciation, or relinquishment of a known legal right. In Walker v. Wigginton, 50 Ala. 583, a waiver, as the word is employed in section 1779 of the Code, was thus defined by Peters, C. J.: “To waive, is to give up, to abandon and relinquish. It leaves the thing abandoned as though it had never been.” That which will constitute a waiver of demand and notice by the indorser of commercial paper, will constitute a waiver of suit by the-assignor of paper not commercial. The parties stand in relations bearing resemblance ; the contract of each is conditional, and the words and conduct of each, it is reasonable and just to subject to like interpretation.

A waiver of suit by the indorser or assignor of paper not commercial, unlike the waiver of demand and notice by the indorser of commercial paper, must be in writing ; the statute is clear, unqualified, and may properly be said to be a prohibition of all merely verbal waivers. “The time for bringing the suit, as required by the preceding sections, may be extended, or waived by the consent of the indorser or assignor in writing, signed by him.” — Code of 1886, § 1779. Originally, the statutory requirement was limited to cases in which the amount due did not exceed fifty dollars, of which justices of the peace had jurisdiction. Its words were, “unless the indorser consent in writing, that further time may be given to the maker or obligor.” — Clay’s Dig. 583, §§ 12-15. The construction of the statute, conforming to its words, was, that it was without application, when the amount due exceeded fifty dollars, and for the recovery, courts of record only had jurisdiction ; and the statute being out of the way, as was said, “there was no rule of law, or policy, to prevent a verbal consent from binding the indorser.” — Litchfield v. Allen, 7 Ala. 779. The present statute comprehends all indorsements or assignments, without regard to the amount due; and the change of phraseology from that of the former statute is marked, signifying the intent to render unavailing, all verbal waivers of suit, or extensions of the ■time of bringing suit, not leaving either to the uncertainties of parol evidence.

The sections of the Code, 1778-1782, had their origin in an act passed by the General Assembly in 1828, and the judicial construction it had received. As declared in its preamble, the evil the act of 1828 was intended to cure, was the public injury resulting from the uncertainty of the decisions of the courts, as to the . proper time of making demand of payment of the payers of paper, negotiable and not negotiable, in the sense of the law merchant. As to paper of the latter character, it dispensed with presentment for payment to the maker, and notice to the indorser or assignor of non-payment,' substituting for them suit against the maker, in accordance with its provisions. — Clay’s Dig. 382; 1 Brick. Dig. 278, § 378; Mobile Savings Bank v. McDonnell, 83 Ala. 595. In their present form, embodying the act of 1828, and the judicial construction it had received, they were introduced into the Code of 1852, (Code of 1852, §§ 1543-48) ; and have been preserved and re-enacted in that form, -in all the subsequent revisions or codifications of the statutes. They are to be regarded as a single statute, and it is merely elementary to say, that they must be so construed as to render them harmonious in operation, if possible, not placing one partin antagonism to another. — Brooks v. Mobile School Commissioners, 31 Ala. 227. The seventh subdivision of section 1780, was not introduced, as a separate, distinct legislative enactment. It was enacted solely as a new, additional excuse, relieving from the necessity of suit against the maker. A construction which would give it any other field of operation, would place it in antagonism to other parts of the statute, and cannot be just or reasonable. If the legislative intent had been that, in any event, it should operate a modification or qualification of the important requirement of section 1779, that a waiver, or extension of time for bringing suit, must be in writing, signed by the indorser or assignor, it is the fair and just presumption, that the intent would have been directly and clearly expressed. The act or promise inducing the delay of suit, if it is not in writing, must not have only the elements of a waiver, or the extension of the time of bringing suit,'displacing the requirements of section . 1779 ; that would place parts of the statute in antagonism. •Without now assuming to decide what acts, or promises, inducing the delay of suit, the sub-division may comprehend, it is enough to say, that an express promise to pay the debt with or without writing, or representation of the solvency of the maker, inducing the delay of suit, made before .the period of suit had expired, we incline to the opinion, would constitute a promise, or an act, within its meaning. The promise to pay must, however, be express; it must not be a mere implied promise deduced from a verbal waiver of suit, for that would render nugatory the mandate of the statute that the waiver to be availing must be in writing, and if it was in writing, there would be no occasion for resorting to the sub-division. Giving to the subdivision, this operation, avoids collision with other parts of the statute, and leaves it, as enacted, a new, additional excuse for the failure to sue. The conclusions we have expressed render unnecessary a consideration of the averments of the complaint as to facts and transactions occurring after the lapse of the period of bringing suit, and which could not have induced the failure to sue.

The result is, we find no error in the sustaining of the demurrers to the complaint, and the judgment of the court below, must be affirmed.

Affirmed.