( Dunham v. Peterson, 5 N.D. 414 [57 Am. St. Rep. 556, 36 L.R.A. 232, 67 N.W. 293]; Hendrix v. Bauhard, 138 Ga. 473 [Ann. Cas. 1913d 688, 43 L.R.A. (N.S.) 1028, 75 S.E. 588]; Mangold and Glandt Bank v. Utterback, 54 Okla. 655 [L.R.A. 1917B, 364, 160 P. 713]; Richmond Guano Co. v. Walston, 191 N.C. 797 [46 A.L.R. 1512, 133 S.E. 196].) But no case has been called to our attention with the exact words used in connection with this endorsement or with such a similar wording that would warrant us in accepting as authority the ruling from another jurisdiction.
"The majority decisions are the better reasoned and are in accordance with the policy of free circulation of commercial paper as a substitute for money and with the spirit and purpose of the Negotiable Instruments Law. In Mangold Glandt Bank v. Utterback, 54 Okla. 655 [ 160 P. 713, L.R.A. 1917B, 364], after quoting section 4113 of the Oklahoma Revised Laws of 1910, which is identical with section 3144 of our Civil Code and with section 63 of the Negotiable Instruments Law, all of which provide: `A person placing his signature upon an instrument otherwise than as maker, drawer or acceptor is deemed to be an endorser, unless he clearly indicates by appropriate words his intention to be bound in some other capacity', the Oklahoma court said: `It will be observed from section 4113 that the tendency of the law, when the status of a party who places his name upon the back of a negotiable instrument is under consideration, is to resolve all doubtful cases towards holding the same to be a commercial endorsement in due course. This rule is founded upon commercial necessity.
Thus, it has been held that a guaranty when accompanied by words usually related to the rights of an endorser, such as waiver of presentment, notice of protest and dishonor, the contract will be construed as an endorsement with the enlarged liability of a guarantor. Mangold Glandt Bank v. Utterback, 54 Okla. 655, 160 P. 713, L.R.A. 1917B, 364; First National Bank v. Cummings, 69 Okla. 216, 171 P. 862, L.R.A. 1918D, 1099; Delk v. City National Bank of Duncan, 85 Okla. 238, 205 P. 753; See Annotations 21 A.L.R. p. 1375, 33 A.L.R. p. 97 and 46 A.L.R. p. 1516, and cases cited therein. Other courts hold that the use of the word "guarantee" clearly indicates the nature of the obligation and a contract using words of guaranty will be so treated, although it may also contain words usually related to the obligations of an endorser.
The petition herein does not particularize as to the capacity in which Flynn signed the note, but merely alleges that "defendants * * * made, executed and delivered" the same, whereas the plea to jurisdiction specifically alleged the makers of the note to be Henry, O'Daniel, and Patterson. It does not appear that plaintiff controverted by additional plea, or contested by the introduction of evidence, the verified allegations of the plea to jurisdiction. As held in Mangold Glandt Bank v. Utterback, 54 Okla. 655, 160 P. 713: "The tendency of the law, when the status of a party who places his name upon the back of a negotiable instrument, is under consideration, is to resolve all doubtful cases toward holding the same to be a commercial indorsement in due course."
It is clear, under the law and the facts in this case, that the substance of the facts stated would not constitute a cause of action on behalf of the defendant and against the plaintiff on the $500 note. Plaintiff being an innocent purchaser, for value, without notice and before the maturity of said note and in the usual and ordinary course of business, the defendant would have no cause of action against the plaintiff. Mangold Glandt Bank v. Utterback, 54 Okla. 655, 160 P. 714. The only complaint that the defendant makes is that he executed this note to the Bank of Commerce of Sulphur, Okla., to accommodate a personal friend.
Where the bank claims to be the holder of the notes upon which it seeks to prorate in the security, the burden is upon it to show that it is a bona fide holder in due course, for value and in good faith. Mangold v. Utterback, 54 Okla. 655, 160 P. 713; Collins v. Waide, 70 Okla. 191, 173 P. 835; State v. Emery, 73 Okla. 36, 174 P. 770; McKone v. McConkey, 77 Okla. 3, 185 P. 520. And since the Bank Commissioner stands in the shoes of the bank, this burden would naturally rest upon him, and we have no difficulty in reaching the conclusion that he failed to sustain the same.
Affirmed. See, also, 54 Okla. 655, 160 P. 713, L. R. A. 1917B, 364. Randall U. Livesay, for plaintiff in error.
In this case the trial court could, and did determine from the pleadings in the case the rights of the parties, and, the defendants having pleaded no sufficient defense to the action of the plaintiff, the motion of plaintiff for judgment was properly sustained. Mangold Glandt Bank v. Utterback, 54 Okla. 655, 160 P. 713, L. R. A. 1917B. 364. The judgment of the trial court should be affirmed.
"An indorsement made on the back of promissory note in the following language: 'For value received, we hereby guarantee payment of within note at maturity, waiving demand, protest, and notice of protest,' signed by the payee of the note, is a commercial indorsement as well as a guaranty of payment; and, the note being negotiable in form, is sufficient to pass a valid title to the paper and protect an innocent purchaser thereof." In Mangold Glandt Bank v. Utterbank, 54 Okla. 655, 160 P. 713, L. R. A. 1917B, 364, it is held: "When the payee of a negotiable promissory note transfers it by indorsing thereon: 'Payment guaranteed.
In other states than California the courts have placed such construction as the words used indicated. Dunham v. Peterson, 5 N.D. 414, 67 N.W. 293, 36 L.R.A. 232, 57 Am.St.Rep. 556; Hendrix v. Bauhard Bros., 138 Ga. 473, 75 S.E. 588, 43 L.R.A.(N.S.) 1028, Ann.Cas.1913D, 688; Mangold & Glandt Bank v. Utterback, 54 Okl. 655, 160 P. 173, L.R.A.1917B, 364; Richmond Guano Co. v. Walston, 191 N.C. 797, 133 S.E. 196, 46 A.L.R. 1512. But no case has been called to our attention with the exact words used in connection with this indorsement or with such a similar wording that would warrant us in accepting as authority the ruling from another jurisdiction.