Keene's Administrator v. Miller

CHIEF JUSTICE LEWIS

delivered the opinion op the cotjbt.

The question in this case is as to the liability of T. J. Miller, who as the surety of his brother, Henry Miller, signed a blank note of the following printed form which was filled up and altered in the manner hereafter mentioned:

$........ Springfield, Ky............189..

“The parties waive protest, or notice of protest, if this paper is not honored at maturity.

....................after date... .promise to pay to the

order of.........................., ............Dollars,

value received, negotiable and payable at the First National Bank, Springfield, Ky., with interest from date at the rate of six per cent, per annum, until paid.

“No...... ......................

“Due...... ......................

The blanks were filled by the insertion of the date, the amount, which is $1,000; time of payment, which is six months after date, and the name of the payee, C. W. Keene. And the alteration was made by striking out the word six and inserting the figure 8, whereby the obligation was to pay eight instead of six per cent, interest from date. After thus filling the blanks and making the alteration, which was done by Henry Miller, he affixed his signature above that of T. J. Miller, delivered the note, and received the $1,000 — then borrowed from Keene.

When a party, being an intended surety, signs his name to a blank note, he thereby, at least impliedly, authorizes his intended principal, as his agent, to fill the blanks, as to the amount to be paid, and terms, date of payment of both principal and interest. And the payee, may safely furnish the money, or other consideration of the note, relying and having the legal right to rely upon the principal having that authority.

Accordingly, it was held by this court in Patton v. Shanklin, 14th B. Monroe 15, that the principal did not exceed his authority to the prejudice of, or so as to release the surety, although after the note had been signed in blank, he without the knowledge or consent of the surety, inserted an agreement to pay eight per cent, interest, because as then held that agreement being void and unenforcible, his legal obligation was thereby neither changed nor increased. In Terry & Bell v. Hazelwood, 1st Duvall, 104, it is distinctly held that an immaterial alteration in a bond or noté will not violate it, the rule being stated, that where the duties, liabilities, or obligations of a surety are not increased or changed, by an alteration, he can not be prejudiced thereby and should not be released.

In our opinion, where the legal effect and operation of an instrument remains the same notwithstanding an alteration, there is no reason for releasing a surety thereto; and such seems to be the doctrine approved generally, as well as by this court.

In this case the alteration did not have the effect to render the surety legally liable for more than six per cent., which he was bound by the instrument, before the alteration, to pay, because the undertaking to pay in excess of six per cent, interest was void and unenforcible.

Certainly the circumstances under which the alteration was made by Henry Miller do not make this case an exception to, or require a relaxation of the doctrine just stated.

For the evidence shows not only that Thos. J. Miller signed the blank note for the purpose of enabling Henry Miller to borrow the money from the Springfield bank, and in the belief it would be necessary in order for him to get it, to insert an agreement to pay interest at the rate of 8 per cent., but the purpose for which the note was given was to get money to pay off existing notes for which they were jointly bound.

In our opinion the lower court erred in deciding the alteration in question operated to release Thos. J. Miller from liability as surety on the note, and the judgment is reversed and cause remanded for further proceedings consistent with this opinion.