Opinion
December Term, 1823.
1. A demand of the maker of a note, and notice of nonpayment given to the indorser within reasonable time, is necessary to charge the indorser: what is reasonable time must depend on circumstances. Four months, when the parties all resided in the same village, is unreasonable.
2. When the holder of a note procured a confession of judgment from the maker, and granted him a cessat executio during six months, when, had he regularly brought suit to the term at which the judgment was confessed, the execution would have been delayed but three months, it was Held, that by this conduct the holder virtually made a new contract with the maker, by which the indorser was exonerated from all liability.
THIS cause was tried before Nash, J., at GRANVILLE, September Term, 1823, and the defendant had a verdict. The case stood before this court on a motion for a new trial, and the facts were these: Holden executed to the defendant a sealed note for $636, and dated 26 June, 1820. On 28 June, 1820, the defendant indorsed the note to plaintiff. At the county court of Granville, in August, 1820, the plaintiff, without having issued any writ, obtained from Holden a confession of judgment on the note, and granted him a stay of execution until February Term, 1821, and an entry to this effect was made on the clerk's docket at the time. The plaintiff offered no evidence of a demand upon the maker except the judgment confessed by Holden. He, however, offered in evidence a deed of trust executed by Holden to Samuel Hillman on 4 November, 1820, and all in the handwriting of the defendant, by which Holden conveyed certain property in trust, for the benefit of the defendant and other creditors; and plaintiff contended that this amounted either to evidence of notice to the defendant or a waiver on defendant's part of notice. The property conveyed in trust when sold was insufficient to satisfy the debts intended to be secured by it, and plaintiff, under the sale, received his proportionate share, $440. It also appeared that in (526) February or March, 1821, the sheriff sold property of Holden's not included in the deed of trust, by virtue of executions issuing on judgments obtained in November, 1820. Defendant contended, (1) that there was no sufficient evidence of a demand or notice; and, (2) that by taking the confession of judgment and granting a stay of six months, plaintiff had made a new contract with the maker of the note, and thereby released the indorser.
Hillman for defendant.
The court charged the jury that to entitle the plaintiff to recover it was necessary he should have made a demand of Holden, and have given defendant notice of it, and of the nonpayment of the bond, within a reasonable time; that what was reasonable notice depended on circumstances; the law, however, in all cases, required the assignee to use due diligence in presenting, and that he should, as soon as he conveniently could, give notice to the indorser of the demand and dishonor of the note; that the deed of trust having been taken up upwards of four months after the indorsement of the note, and only for part of Holden's property, in no way dispensed with the necessity of notice; that if it was received as evidence of notice, it was only evidence at the time of its date, which, being four months and more after its indorsement, was not in reasonable time, the parties all residing in the same village; but if they could infer from any other circumstance that the defendant had earlier notice they were at liberty to do so, and that plaintiff having taken a confession of judgment and given a stay of six months, when, if he had brought his suit regularly to August term, he could only have kept it off three months without appearing, in which event the debt would have been secured, he had virtually made a new contract with Holden by which the defendant was exonerated from all liability.
We think the question whether the plaintiff made use of due diligence, and whether the notice to the defendant was given in reasonable time, were properly left to the jury by the presiding judge, and that he correctly explained to them the law arising upon the case; therefore we see no reason why a new trial should be granted.
PER CURIAM. No error.