UNITED STATES SUPREME COURT DECISIONS ON-LINE

SPRIGG V. BANK OF MOUNT PLEASANT, 35 U. S. 257 (1836)

35 U. S. 257

U.S. Supreme Court

Sprigg v. Bank of Mount Pleasant, 35 U.S. 10 Pet. 257 257 (1836)

Sprigg v. Bank of Mount Pleasant

35 U.S. (10 Pet.) 257

Syllabus

The plaintiff in error, with others, executed to the Bank of Mount Pleasant a sealed obligation for the payment of the sum of $2,100, at the expiration of sixty days, and in the instrument each of the parties to it acknowledged himself bound as principal. The money was loaned on the instrument to and for the exclusive benefit of one of the parties to it, and after the time of payment arrived, the bank gave a farther credit to the borrower, receiving from him the discount for the extension of payment. No notice was given to the other parties of this fact. The amount loaned not having been repaid, this suit was instituted on the obligation, and the defendant pleaded several pleas, alleging he was discharged from all liability under the obligation. The plaintiff replied that each of the obligors having acknowledged himself as principal in the instrument, all were estopped from setting up any defense in opposition thereto.

By the court:

"This case is to be governed by rules applicable to proceedings in courts of law, and upon this point the rule seems to be well settled that when principal and surety are bound jointly and severally on a bond, although there is no express admission on the face of the instrument that all are principals, yet the surety cannot aver by pleading, that he is surety only."

When one who is in reality only surety is willing to place himself in the situation of principal by expressly declaring upon his contract that he binds himself as such, there cannot be any hardship in holding him to the character in which he assumes to place himself. As to that particular contract, he undertakes as a partner with the debtor, and has no more right to disclaim the character of principal than the creditor has to treat him as principal if he had set out in the obligation that he was only surety.

In this case, the fact of the defendant's being surety is not only admitted, but it is alleged that he is estopped from setting it up by his own admission in his obligation that he is principal. And we are not aware of any case giving countenance to such a defense at law under such circumstances.

It is an established rule in demurrers that although the pleading demurred to may be defective, the court will give judgment against the party whose pleading was first defective in substance.

It is the settled rule of law in relation to sureties that extending to principals further time of payment will discharge the surety.

The defendant in error instituted in the circuit court an action of debt on the following obligation, executed by the plaintiff in error, and others.

"Know all men by these presents, we, Peter Yarnall & Co., Samuel Sprigg, Richard Symms, Alexander Mitchell and Z. Jacobs,

Page 35 U. S. 258

as principals, are jointly and severally held and firmly bound to the President, Directors and Company of the Bank of Mount Pleasant for the use of the said Bank of Mount Pleasant in the just and full sum of $2,100 lawful money of the United States, to the payment of which sum well and truly to be made to the said president, directors and company, for the use aforesaid, within sixty days from the date hereof, we jointly and severally bind ourselves, our heirs, &c., firmly by these presents. Signed with our hands, and sealed with our seals this 20 of February, A.D. 1826."

"PETER YARNALL & CO. [SEAL]"

"SAMUEL SPRIGG [SEAL]"

"RICHARD SYMMS [SEAL]"

"ALEXANDER MITCHELL [SEAL]"

"Z. JACOBS [SEAL]"

To the declaration on this obligation the defendant pleaded the general issue and six special pleas. The questions which were discussed and decided by the Court were presented on the second plea and sixth.

The second plea was as follows:

"2. And for further plea in this behalf, by leave of the Court here for that purpose first had and obtained according to the from of the statute in such case made and provided, the said Samuel, by his said attorney, comes and defends, &c., and says, that the said plaintiffs ought not to have or maintain their action aforesaid against him because he says that the President, Directors and Company of the Bank of Mount Pleasant constitute an incorporated banking company, located at Mount Pleasant, in the County of Jefferson, in the State of Ohio, doing and transacting business in the usual manner of a bank, and that the said $2,100 mentioned in the said writing obligatory was a loan made by the plaintiffs as such banking company, in the ordinary way of making such loans at said bank, to the said Peter Yarnall & Co. and for their accommodation, and that the said writing obligatory was given to said bank for the sole and only purpose of securing the payment of the said loan at the expiration of thirty days from the date thereof, and that the said Samuel Sprigg, as also the said Richard Symms, Alexander Mitchell and Z. Jacobs, were in truth and in fact securities for the said Peter Yarnall & Co. for the payment of the said loan in sixty days as aforesaid, and were so received and treated by the said plaintiffs, and that the said Peter

Page 35 U. S. 259

Yarnall & Co. received for their own exclusive benefit and accommodation the entire amount of the said $2,100, and were so entered and charged on the books of the plaintiffs in their said bank, and the defendant further avers that at the time the said writing obligatory became due, to-wit, on 21 April, Anno Domini 1826, the said plaintiffs, for and in consideration of $22.48 cents, paid by the said Peter Yarnall & Co. to the said plaintiffs for the discount or interest in advance on the said $2,100 for sixty days then next following, undertook and agreed with the said Peter Yarnall & Co., without the knowledge or consent of the said Samuel Sprigg, Richard Symms, Alexander Mitchell and Z. Jacobs, or either of them, to give a further credit on the said loan of sixty days and to extend the time of payment thereof for sixty days, from and after the said 21 April last aforesaid, and the defendant avers that the said plaintiffs did give to the said Peter Yarnall & Co. the further credit and time of payment thereof for sixty days as aforesaid, and without the knowledge or consent of the said Samuel Sprigg, Richard Symms, Alexander Mitchell and Z. Jacobs, or either of them, and against their will; by means whereof the said Samuel Sprigg says that he is discharged from all liability on or by virtue of the said writing obligatory; and this he is ready to verify, wherefore he prays judgment, &c."

The sixth plea was:

"6. And for further plea in this behalf, by leave of the Court here for that purpose first had and obtained according to the form of the statute, the said Samuel, by his attorney, comes and defends, &c., and says that the said plaintiffs ought not to have or maintain their aforesaid action against him because he says that the said plaintiffs are an incorporated banking company, doing and transacting business in the usual way and manner of banks, and that the said $2,100 mentioned the said writing obligatory in the plaintiff's declaration described, and of which oyer is craved, and the same is set out in the said Samuel's first plea, was a loan made by the said plaintiffs at their banking house, in the Town of Mount Pleasant, in the said County of Jefferson, in the usual way of making loans at said bank, to and for the sole benefit and accommodation of Peter Yarnall & Co., the first obligors in said writing obligatory, and that the said writing obligatory was given to the said bank for the sole and only purpose of securing to said bank the payment of the said loan so made to the said Peter Yarnall & Co. as aforesaid, in sixty days from the date

Page 35 U. S. 260

thereof, and that the said Samuel Sprigg, Richard Symms, Alexander Mitchell, and Z. Jacobs were in truth and in fact merely securities of the said Peter Yarnall & Co. for the payment of the said loan in sixty days as aforesaid, and were so received and accepted and treated throughout by the said "

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plaintiffs in all the transactions in said bank relating to said loan, and the said Samuel avers that at the time the said writing obligatory became due, to-wit, on the 21 April, Anno Domini 1826, the plaintiffs, in consideration of $22.40 cents, paid to them by the said Peter Yarnall & Co. for the discount or interest in advance on the said $2,100 for sixty days then next following, undertook and agreed with the said Peter Yarnall & Co., without the knowledge or consent of the said Samuel Sprigg, Richard Symms, Alexander Mitchell and Z. Jacobs, or either of them, to give, and then and there did give to the said Peter Yarnall & Co. the further credit and further time of payment of the said loan and the said writing obligatory for sixty days from and after the said 21 April aforesaid, and the said Samuel further avers that afterwards, to-wit, at the expiration of the said sixty days, further credit and time of payment as aforesaid, and at the expiration of each and every sixty days successively thereafter until 24 March, Anno Domini 1829, the said plaintiffs did receive at their bank in the said town of Mount Pleasant, of and from the said Peter Yarnall & Co., the sum of $22.40 for the discount or interest in advance of the said loan of $2,100, and at each consecutive day of discount and payment of interest in advance as aforesaid, until the said 24 March, Anno Domini 1829, that said plaintiffs did, without the knowledge or consent of the said Samuel Sprigg, Richard Symms, Alexander Mitchell and Z. Jacobs, or either of them, and in consideration of the said sum of $22.40 so paid to them by the said Peter Yarnall & Co. on each of the said days of discount, and payment of interest in advance as aforesaid, agreed with the said Peter Yarnall & Co. to give, and did then and there give to the said Peter Yarnall & Co. the further credit and time of payment of said loan of sixty days from and after each consecutive day of discount and payment of interest in advance as aforesaid until the said 24 March aforesaid, and the said Samuel further avers that afterwards, to-wit, on or about the said 24 March, Anno Domini 1829, the said Peter Yarnall & Co. failed in business, became insolvent, and unable to pay their just debts, and that the said Samuel Sprigg, Richard Symms, Alexander Mitchell and Z. Jacobs clubjuris

Page 35 U. S. 261

had not, nor had either of them, any notice of the nonpayment of the said loan or of the outstanding of the said writing obligatory from the time the same became due, to-wit, on 21 April, Anno Domini 1826, until after the failure and bankruptcy of the said Peter Yarnall & Co. as aforesaid, by reason whereof he, the said Samuel, says he ought not to be charged with the said debt, or any liability on or by virtue of the said writing obligatory, all which he is ready to verify, wherefore he prays judgment, &c.

To the second and sixth plea the plaintiff replied, that the said Samuel Sprigg, together with Peter Yarnall & Co., Richard Symms, Alexander Mitchell and Z. Jacobs acknowledged themselves to be jointly and severally held and firmly bound, as principals, to the said President, Directors and Company of the Bank of Mount Pleasant, for the use of the Bank of Mount Pleasant, in the sum of 2100 dollars as aforesaid.

The defendant demurred to this replication.

The circuit court gave judgment for the plaintiff on the replication to the second and sixth pleas; from which judgment the defendant prosecuted this writ of error. clubjuris

Page 35 U. S. 263


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