Simpson's v. Bovard , 74 Pa. 351 ( 1874 )

The opinion of the court was delivered, January 26th 1874, by

Mercur, J. —

The first assignment raises the question of the competency of Campbell to testify in behalf of his co-defendant in the judgment. The plaintiff being an executor, and the evidence relating to what transpired during the life of his testator, it is contended that the Act of 15th April 1869 is inapplicable. Prior to this act, the general rule in Pennsylvania undoubtedly was, that a party to the record was incompetent to testify. Generally, a principal debtor is not a competent witness for a surety in an action against the latter. Whenever, however, the suit is ended as to the principal, and the defence made by the surety is personal as to him, as were the facts here, the principal is substantially discharged from the record. Although no regular feigned issue be formed in practice, yet, under the order of court, the trial is in the nature of one and embraces only the parties thereto. Campbell was therefore a competent witness: Talmage et al. v. Burlingame et al., 9 Barr 21. This assignment is not sustained.

The second, fourth, fifth, twelfth, thirteenth and fourteenth assignments will be considered together. They all relate to the execution and delivery of the note. We •’cannot say there was no evidence that Bovard signed under an agreement with Campbell that the name of a co-security should be procured before the note was to be delivered: but it was weak and unsatisfactory. The evidence indicates merely an expectation in the mind of Bovard that another name would be procured, rather than an agreement that it should be, prior to the delivery thereof. In Hoskins et al. v. Lombard, 16 Maine 140, it was held, that a mere expectation by the surety, that the bond would be signed by another surety, although not signed by the other, is'binding upon the one signing. It is true there was some evidence that Simpson’s alleged agent understood, before the note was 'drawn, that Campbell was to procure the signature of two sureties for Simpson’s benefit, yet there was no evidence that either Simpson or his agent had any knowledge that this was communicated to Bovard, or that he acted upon it. Simpson may well have supposed that the note was prepared to meet his requirement only for two sureties. When the note was presented to him with the name of Bovard only as surety, he was satisfied with it, and waived the procurement of another.

Bovard signed the note in blank and put it into Campbell’s possession, with authority to fill it up and to use it in payment of the outstanding note of $1000, which Simpson held against Campbell. Bovard thereby made Campbell his agent to complete the note. In the exercise of his power Campbell filled the note. He added to the $1000 the accrued interest and the bonus agreed upon for the extension. The' new note was used in the liquidation and extension of the .original debt; that was the purpose for which Bovard signed the note. He clothed Campbell with the apparent authority to fill the note for an amount sufficient to secure the general purpose for which it was to be given. He cannot, then, be permitted to avoid his liability, to the prejudice of one who took the note in good faith and paid for it a valuable consideration, by showing that the specific and private instructions given to his agent were not followed. Hence it was ruled in the York County M. F. Ins. Co. v. Brooks, Supreme Judicial Court of Maine, cited in 3 Am. Law Beg. N. S. 399, that where a surety to a bond signed upon the assurance that the principal would also secure two other persons specified and known to such surety, to sign the bond before he delivered the same, which the principal failed to do, but this was wholly unknown to the obligee at the time he accepted the bond, such surety was bound to perform the obligation.

It is a well-settled principle in equity that where one of two innocent persons must suffer, he shall suffer who, by his own acts, occasioned the confidence and the loss. Here Bovard, by his voluntary act, put in Campbell’s hands the obligation, and gave to him the apparent authority to fill it in such an amount as he saw proper. He thereby created the confidence, and must suffer the loss thus occasioned: Garrard v. Haddan, 17 P. F. Smith 82.

We do not think the fact that Campbell filled up the note in the presence of Simpson created any presumption that he was exceeding his instructions. It was an act rather calculated to repel any suspicion of his improper conduct. Nor was the seal without a signature sufficient to have put Simpson on inquiry: Keyser v. Fleen 5 Harris 327.

As, then, there was no evidence of any fact being communicated to the plaintiff sufficient to have put him on inquiry, the fact of the jury having found that Campbell exceeded the specific authority delegated to him becomes unimportant. It follows that the court should have affirmed the first and second points submitted by the plaintiff, and the fourth and fifth assignments are sustained. The court, in the portions of the charge covered by the twelfth and thirteenth assignments, stated the law correctly as an abstract proposition, yet the facts were insufficient to raise a presumption of notice. ■ The learned judge therefore erred in admitting the evidence covered by the second assignment, and the twelfth, thirteenth and fourteenth assignments are sustained.

The eighth and sixteenth assignments relate to the diligence required of the plaintiff. At the time the notice was given to enter the note, it was not due. No execution could therefore have been issued. Simpson resided some four or five miles from the county seat. The notice was given, from four to five o’clock in the afternoon, in the month of April. No specific reason was assigned why it should be entered. The plaintiff did cause it to be entered the next morning at eight o’clock. Under the circumstances, we think the plaintiff did exercise reasonable diligence in entering the note, and the seventh point submitted by the plaintiff should have been affirmed, and the eighth and sixteenth assignments are sustained. We discover no error in the third, sixth, seventh, tenth, eleventh and seventeenth assignments.

Judgment reversed, and a venire facias de novo awarded.