Novak v. Dupont , 112 Iowa 334 ( 1900 )

Ladd, J.

1 In order to facilitate his dealings in commercial paper with the Iowa City State Bank, J. J. Novak, in 1S89, executed his bond, with Frank Novak, his father, and J. II. Dupont, as sureties, conditioned that “if said J. J. Novak or his legal representatives will pay, or cause to be paid, to the said Iowa City State Bank all notes executed to, all overdrafts, or notes guaranteed by him to said bank, and to hold said bank harmless from any and all losses by reason of said J. J. Novak’s transactions with and through said bank, then this bond shall be void and of no effect; otherwise, in full foi-ce and effect.” June 24, 1890, J. J. Novak, with the same sureties, executed to said bank a note; of $2,000, due in four months, which was paid by plaintiff, December 31, 1891, after suit thereon. The costs, including attorney’s fees, however, were not discharged until 1897. On August 8, 1891, J. J. Novak, with Drank Novak as surety, executed to said bank a note of $2,000, due in GO days, which was paid by the surety during 189G and 1897. As no claim is made on the third note, it requires no attention. At the conclusion of plaintiff’s evidence, showing these facts, a verdict was, on motion, directed for the administratrix of the estate of Dupont, deceased. It will be observed that as the claim was filed December 22, 1897, more than five years had elapsed since the payment of the first note, and for this reason recovery was barred by the statute of limitations. Wilson v. Crawford, 47 Iowa, 469; Miller v. Lesser, 71 Iowa, 147; Preston v. Gould, 64 Iowa, 44.

2 II. But it is assorted that, as Dupont was also liable on the bond, the amounts paid on both', notes were in discharge of that obligation, and, as plaintiff could not demand contribution until he had paid his one-half of the amount for which they were obligated on the bond, the remaining one-half was paid on the second note within the period of limitation; in other words, that the payment of the two notes must be treated as discharging their joint liability on the bond, and plaintiff allowed to recover the last half by him paid. Ordinarily, one of two joint obligors for the payment of money is bound to indemnify the other for any sum necessarily paid in excess of his proportional share in discharge of their obligation. Bui, until more than .the proportional share has been paid, no cause of action accrues. Pegram v. Riley, 88 Ala., 399 (6 South. Rep. 753) ; Camp v. Bostwick, 20 Ohio St., 337; Bonham v. Galloway, 13 Ill., 68; Ponder v. Carter, 34 N. C., 242. See Mills v. Hyde, 19 Vt., 59 ; Boardman v. Paige, 11 N. H., 431. This is because of his absolute liability for his own share, and, until that has been discharged, nothing ean bo said to have been contributed for the other.

But the contingency of the failure to pay the second note never arose, and hence the condition of the bond with respect to that was never broken. ' While J. J. Novak did not pay it, his surety on the note did. The condition that he “pay of cause to be paid” the note was fully complied with, as on his omission, the surety, who Avas also bound, satisfied it. It was only on failure so to do that the sureties on the bond were to be bound to meet his obligations. The situation Avas not different than it would have been had persons not on the bond become sureties on the notes of J. J. Novak to the bank. A contingent liability would then have instantly attached, and as quickly ceased, upon payment made by principal or sureties. The. circumstance that plaintiff was surety on the bond did not affect his obligation as surety on the note, and the discharge of his liability on the former Avas merely incidental to, and necessarily resulted from, meeting his promises contained in the latter. The bond secured no particular indebtedness, but Avas intended to cover all aaIiícIi might como Avithin its conditions. The note, executed a long time after, Avas to be paid by the bondsmen only in event those executing it failed to do so. The bank never pressed the bond, but demanded and reeeiAred payment of the note because of plaintiff’s obligation as surety thereon. As Dupont Avas not surety on the second note, and as the condition of the bond Avas not broken by a failure to discharge it by the payors, he Avas not liable for contribution of any part paid thereon. The apportionment of costs Avas authorized by sections 3S53 and 3854 of the Code. — Akiurmed.

Granger, C. J., not sitting.