Hutchins v. McCauley, 22 N.C. 399, 2 Dev. & Bat. Eq. 399 (1839)

Dec. 1839 · Supreme Court of North Carolina

22 N.C. 399, 2 Dev. & Bat. Eq. 399

JOHN HUTCHINS et al. vs. MATTHEW McCAULEY, Ex’r of CHARLES McCAULEY.

If a note, discounted at bank for tbe benefit of a principal with three sureties, be discharged at maturity by the proceeds of another note, discounted with only two of the sureties, the third having died before the first note fell due, the estate of the latter will not be liable to contribute, upon the insolvency of the principal, and the payment of the renewal note, by the sureties thereto, although when the/ executed it, they supposed the estate of the deceased would be liable upon it.

The bill stated that one Adams, as principal, procured a note, to which the plaintiffs and the defendant’s testator were sureties, to be discounted at Bank. That Charles McCau-ley died before this note came to maturity; and that Adams, for the purpose of raising money to meet this note, offered another note with the plaintiffs only as his sureties, which was discounted, and the proceeds applied to the satisfction of the first note. Adams afterwards became insolvent, and the plaintiffs as his sureties on the second note, were sued, and had to pay a large portion of the debt. The bill then stated, that at the time the debt was renewed by giving the second note, the plaintiffs did not suppose that Charles M’Cauley’s estate was thereby released, but believed that it would be equally bound with themselves, for any deficiency on the part of their principal. The prayer was, that the executor of Charles McCauley might be decreed to contribute to the loss sustained.

To this bill the defendant demurred, and his Honor Judge Baxley, at Orange, on the last circuit, sustained the demurrer, and the plaintiffs appealed.

No counsel appeared for the plaintiffs in this Court.

Waddell for the defendants.

Daniel, Judge,

after stating the case as above, proceeded as follows: It appears by the bill, that when the first note came to maturity, it was paid by Adams. The circumstance of Adams having raised the money to extinguish the first note, by borrowing of the bank, on the second note, according to the rules of accommodation of the bank, did not, by any principle of equity that we are acquainted with, carry the name of Charles McCauley or his estate as surety to the second note, or to the debt thus contracted. By the cancellation of the first noté, the suretyship of Charles McCauley was brought to an end. And any impression to the contrary, which might have rested on the minds of the plaintiffs, does not help their case. The demurrer was properly sustained, and the decree must be affirmed with cost.

Per Curiam. ' Decree affirmed.