Hopkins v. Boyd , 11 Md. 107 ( 1857 )

Lr Grand, C. J.,

delivered the following opinion in the case:

This was an action of assumpsit. In addition to the common money counts the declaration contained special counts on several promissory notes, one dated the 24th day of May 1851, drawn to the order of William Simms, and by him endorsed for $364.26, payable six months after date. The other special counts are respectively on three notes, dated the 31st day of December 1851, each, made by the appellees and endorsed by William Simms; one for $125.24, payable sixty days after date; one for $124.45, payable four months after date, and the other for $125.50, payable six months after date. The action was brought by the appellant, as endorsee, against the appellees, as makers of each and every of these notes. The only facts in the case, as exhibited by the record, necessary to be noticed, may be thus stated:

Before maturity of the note dated the 24th day of May 1851, it was endorsed by the payee, Simms, to the appellant, and by the latter deposited for collection in the Merchants Bank of Baltimore. It became due on the 27th day of November 1851, and being unpaid, was protested for non-payment. On the 31st day of December following the appellant directed the witness, Bowerman, to take for the note the three others already noticed and mentioned in the declaration. These notes were intended, (interest being included,) as a renewal of the note which had been protested. Before they were signed and delivered to the appellant conversations took place between him and Rogers, one of the appellees, in the presence of others; the only part of which it is material to this case to notice, is the following: Rogers said the note for $364.26 had been given without his co-partner’s knowledge, and was not for a partnership transaction; and that he, Rogers, wished the plaintiff to take three notes which Rogers promised to pay. The plaintiff, Hopkins, said in reply, that it was a matter of indifference to him, whether Rogers’ partner knew of the $364.26 note or not, that he had given value for it in the course of business, and took it on the faith of the co-partnership name, and with no notice that it had been given without Boyd’s knowledge or assent, and not for a partnership transaction.

On this state of facts four instructions were asked of the court, two on the part of the appellant, and two on the part of the appellee, Boyd, who had severed in his pleading and defence. The latter and the first on the part of the appellant were granted; the other prayer was rejected. In the granting of the two instructions on behalf of Boyd, and the rejection of the second prayer of the appellant, we are of opinion the court erred.

The first prayer of the appellant, which was granted by the court, merely asserted the general doctrine, (the correctness of which we understood the counsel for the appellee, Boyd, to concede,) that if the jury should find from the evidence, that the appellant discounted for value, before its maturity, the note for $364.20, that had been made by Rogers in the name of the firm of Rogers and Boyd, he being a partner with Boyd in the same firm, and mostly signed the notes of said firm, and the paj'ee of said note endorsed the same to the appellant, who took it without knowledge that it had not been given for a partnership transaction, and without knowledge that it had been given without the assent of Boyd, yet, notwithstanding this want of knowledge and assent of Boyd, said note was binding on the firm.

Although, after dissolution of a partnership, one partner cannot, by a new contract, in the name of the firm, bind his late partner, even when the consideration is a debt of the firm, (8 Md. Rep., 403,) yet, that during the existence of the co-partnership he can bind his co-partner, by signing the name of the firm to negotiable paper, is a proposition too plain to require citations to sustain it, but if any were required the following are directly to the point. Manning & Co. vs. Hays, 6 Md. Rep., 5. Boyd vs. McCann, 10 Md. Rep., 118.

This being so, the question arises, did the court properly reject the second prayer of the appellant? We think not. It reasserts the proposition contained in the first prayer, adding thereto the circumstances connected with the non-payment and protest of the original note, and the giving of the three others in renewal thereof, and concludes by asking the court to instruct the jury, if they should believe the facts so set out in the prayer, that then the plaintiff is entitled to recover. The evidence shows that the three notes, which bear date the 31st day of December 1851, were given as a renewal of the one of the 24th day of May preceding.

It is a clear proposition, thal. unless the taking by the appellant of these last notes was an extinguishment of the original note, then there was no payment of it, and a recovery on it can be had in this action, it being specially declared upon. The taking from the same party of a security of no higher grade or dignity, for another, never works an extinguishment or amounts to a payment, but leaves the original obligation in full force, the holder being free to sue either on the original or substituted one. The following authorities are abundantly full on this point. Glenn vs. Smith, 2 G. & J., 512. Maryland & N. York Coal & Iron Co. vs. Wingert, 8 Gill, 777. Berry vs. Griffin, 10 Md. Rep., 27.

There was no evidence of any agreement to receive the three notes in full payment and extinguishment of the original one; so far from it, it appears from the evidence of the witness, Simms, (a witness on the part of Boyd,) that the proposition was to give the notes as a renewal. The prayer should have been granted; the facts which it accumulated on those set out in the first prayer, were altogether supererogatory. Had the first prayer concluded with an instruction of the right of the plaintiff to recover, it would have contained the whole law of the case. These views, of course, dispose of the prayers of the appellee, Boyd. It is not, however, improper to add, that there is not a particle of evidence disclosed by the record, from which the jury could rightly infer the payment and extinguishment of the original note, nor of any design on the part of the appellant to collude with Rogers to defraud his co-partner, Boyd, facts which the prayers submitted on his behalf ask the jury to find.

The plaintiff had a right to elect to maintain his action, either on the original note or the renewals, or on the insimul computassent count.

So far, what has been stated is the individual opinion of the judge who delivers it. But the whole court are of the opinión that the plaintiff may recover on the renewals; that for the reasons already assigned, the appellant took a good title when he obtained possession of the original note, and to deny the right of Rogers, during the existence of the co-partnership, to renew it, would be to render a perfect title valueless.

Judgment reversed, and procedendo awarded.