the drawee might be able to make as to the influences operating upon his mind to induce him to make payment. * * The best view

that can be taken of this case for the plaintiffs below is that there was a mutual mistake of fact under which the bank discounted and the drawees paid the bill. Conceding this, why should the drawees be allowed to transfer the loss to the bank?"

The principles affirmed by these decisions are supported directly or indirectly by the following cases: Robinson v. Reynolds, 2 Q. B. (Adolphus & Ellis N. S.) 196; Thiedemann v. Goldschmidt, 1 De Gex, F. & J. 4; Leather v. Simpson, L. R. (11 Eq.) 398; Young v. Lehman, 63 Ala. 519; Craig v. Sibbett, 15 Pa. 238; Alton v. First Nat. Bank of Webster, 157 Mass. 341, 32 N. E. 228, 18 L. R. A. 144, 34 Am. St. Rep. 285; Southwick v. First Nat. Bank of Memphis, 84 N. Y. 420; Guaranty Trust Co. v. Grotrian, 114 Fed. 433, 52 C. C. A. 235, 57 L. R. A. 689; Hannay v. Guaranty Trust Co. (C. C.) 187 Fed. 686; 2 Daniel's Negotiable Instruments, § 1734D.

It would likewise be impossible within reasonable limits to review the many cases cited by the learned counsel for the plaintiffs as authority for his contention that they are entitled to recover. Most of them are clearly distinguishable from and not at all contradictory of the cases which have been cited in support of the conclusions reached by us.

It is true that two or three decisions were made by an inferior court of Texas and by the courts of North Carolina, Mississippi, and Alabama, which are at variance with those cases and which do tend to support the plaintiffs' position. These decisions, however, were reversed or so qualified by the courts of the same states respectively that they are not entitled to serious consideration.

We therefore hold that the judgment appealed from should be affirmed, with costs, upon the grounds stated, and find it unnecessary to discuss the arguments which have been addressed to us on other points.

CHAPTER II

DRAWER AND INDORSER

SECTION 1.-IN GENERAL

BISHOP v. HAYWARD.

(Court of King's Bench, 1791. 4 Term R. 470.)

The plaintiff declared on a promissory note made by one Collins, payable to the plaintiff or order, and afterwards indorsed by him to the defendant, who afterwards reindorsed it to the plaintiff again. After verdict for the plaintiff on the general issue, a motion was made by Bower, in arrest of judgment, upon the ground that nothing appeared to be due to the plaintiff on his own showing; for the defendant would be entitled to recover back again the identical sum from the plaintiff for which he had now obtained a verdict against the defendant, and therefore, as this would introduce a circuity of action, which the law does not permit, the declaration was bad upon the face of it.1

Lord KENYON, C. J. It is an invariable rule that every plaintiff must, on his own stating of the case, show sufficient to entitle him to recover judgment against the defendant. And it is a rule equally clear that every instrument ought to be declared on according to its legal import. I do not say but that there may be circumstances, which, if disclosed on the record, might entitle the plaintiff to recover against the defendant on this note; but we are now called upon to form a judgment on the title which he has disclosed. And on the face of the declaration he has stated the note as a legal existing note, and the indorsements as legal existing indorsements; we are therefore bound to consider them to be so. Then the case stands thus: That he, the plaintiff, being the original indorser of the note, calls on the defendant who appears on the record to be a subsequent indorsee. And nothing can be clearer in law than that an indorsee may resort to either of the preceding indorsers for payment; whereas the present action is an attempt to reverse this. I admit that a case might happen in which the plaintiff might have stated that he was substantially entitled to recover on this note, e. g. that his own name was originally used for form only, and that it was understood by all the parties to the instrument that the note though nominally made payable to the plaintiff, was sub

1 The argument of plaintiff's counsel and the opinion of Buller, J., are omitted.

stantially to be paid to the defendant; but if such were the case, the note should have been declared on according to its legal import, as was held in Minet v. Gibson, 3 Term R. 481, 1 H. Bl. 569. A name may be omitted in the declaration, if the legal operation of the instrument requires it. But in this case the plaintiff has stated facts subversive of his title.

PER CURIAM. Judgment arrested.

SHAW v. KNOX.

(Supreme Judicial Court of Massachusetts, Suffolk, 1867. 98 Mass. 214.) Contract on a draft by Nathaniel Heath on John W. West for payment of $450 three months after date to the order of the defendant, indorsed by the latter and bearing also, below the defendant's indorsement, the indorsement of E. Longfellow & Son.

Trial in the superior court, before Morton, J., without a jury, when it appeared that the draft was drawn on the day of its date, and indorsed by the defendant, and then at his request by E. Longfellow & Son, "so that it could be discounted" (neither of the indorsers receiving any consideration therefor), and then was negotiated, and discounted by a bank, and presented for acceptance; that it was accepted by West, but on maturity was protested for nonpayment; and that E. Longfellow & Son some months later paid it to the bank and took it up, and afterwards sold it to the plaintiff.

The defendant asked the judge to rule "that E. Longfellow & Son and the defendant were joint accommodation indorsers, and, when the former paid the draft, its negotiability was destroyed, and they could not pass it to the plaintiff so that he could maintain an action thereon." But he declined so to rule, and ruled that the plaintiff could maintain. his action, and found for the plaintiff; and the defendant alleged exceptions.

BIGELOW, C. J. There was no joint liability on the part of the defendant with the subsequent indorsers. The indorsers on the draft were all liable to the holders of the draft for value on their several contracts of indorsement. There was no agreement between the parties, when the draft was made and indorsed, that they should hold any other relation towards each other than that which would result from their being successive indorsers on the draft for the accommodation of the drawer. If the last indorser paid the draft to the holder for value, he would succeed to the right of such holder, and could look to his prior indorser for payment of the amount paid by him. Guild v. Eager, 17 Mass. 615. Such payment was in fact made by the second. indorsers, from whom the plaintiff derives his title to the draft. The relations of the parties to the draft can in no sense be regarded as creating a contract of joint guaranty and suretyship. The rights and

duties of the several parties to an accommodation note or bill of exchange are the same in all respects as upon notes given for value. The legal effect of the contract into, which they respectively enter by becoming parties to negotiable paper is that which appears on the face of the bill or note. It follows that, if an accommodation indorser is obliged to take up the draft in the hands of a holder for value, he can look to his prior indorser for payment. Church v. Barlow, 9 Pick. 547; Clapp v. Rice, 13 Gray, 403, 74 Am. Dec. 639; Howe v. Merrill, 5 Cush. 80.

Exceptions overruled.

EASTERLY v. BARBER.

(Court of Appeals of New York, 1876. 66 N. Y. 433.)

There were two appeals in this case—the one by plaintiff from an order of the General Term of the Supreme Court in the Fourth Judicial Department denying motion for a new trial and directing judg ment on a verdict; the other by defendant from the judgment entered upon such order.

The action was brought by plaintiff as third indorser of a promissory note to recover the amount thereof of the second indorser.

The note in question was made by the Stevenson Manufacturing Company, payable to the order of one Knight, who indorsed it. Defendant was second indorser, plaintiff third, and one MacDougall the fourth. Defendant alleged in his answer that the note was given and discounted for the benefit of the maker, in which company all the four indorsers were stockholders; that they indorsed for the accommodation of the company under an agreement that as between themselves they should be cosureties, and share and contribute equally to the amount all or either should be obliged to pay thereon.

Upon a former trial plaintiff recovered a judgment for one-fourth the amount of the note. It appeared on such trial that the two other indorsers were insolvent. The General Term reversed the judgment and ordered a new trial on the ground that plaintiff was entitled to judgment for one-half the amount. 3 Th. & C. 421.

Upon the second, parol evidence was received to prove the allegations of the answer, which was received under objection and exception. The evidence tended to show that the note in suit was a renewal of a former note; that the agreement was made in reference to the original note, which was renewed from time to time. The testimony was conflicting as to whether any thing was said in reference to the liability as co-sureties at the time of the indorsements of the note in suit. Plaintiff was allowed to prove, under objection and exception, the insolvency of the other two indorsers, Knight and MacDougall. Evi

dence was given on the part of defendant tending to show that the bank which discounted the note brought suit thereon against plaintiff alone at defendant's request upon his giving security to indemnify the bank.

As to the agreement, the court charged, in substance, that if the jury found that the agreement was made as claimed by defendant, plaintiff was entitled to judgment for one-half the amount of the note, to which defendant's counsel duly excepted.

The court also charged as follows: "If former notes have been given under this agreement, with the understanding that they were to stand with a joint instead of a separate liability, and that note was carried along until it came to this one, and they signed this note with the arrangement and understanding resting upon their minds, you will have no doubt in coming to the conclusion that this agreement attaches to this last note;" to which plaintiff's counsel duly excepted. Exceptions were ordered to be heard at first instance at General Term.2

MILLER, J. The first question presented upon these appeals is whether it is competent in an action by one indorser against a prior indorser for the defendant to prove by parol an agreement between all the indorsers that they were as between themselves cosureties, where they are accommodation indorsers. In Barry v. Ransom, 12 N. Y. 462, it was held that an agreement made between parties prior to or cotemporaneously with their executing a written obligation as sureties, by which one promises to indemnify the other from loss, does not contradict or vary the terms or legal effect of the written obligation, and it may be proved by parol evidence. It was said by Denio, J., in the opinion, that an agreement among the sureties, arranging their eventual liabilities among themselves in a manner different from what the law would prescribe, in the absence of an express agreement, would not contradict any of the terms of the bond. It was also held that the engagement among themselves had no necessary place in the instrument between them and the other contracting parties. The case cited referred to a joint and several bond, where the obligors were equally liable upon its face. No reason exists, however, why the same principle is not applicable to notes and bills of exchange. The terms of the contract contained in instruments of this character, which are within its scope to define and regulate, cannot be changed by parol; but the understanding between the indorsers is a distinct and separate subject, an outside matter, which may be properly proved independent of and without any regard to the instrument itself. This rule is distinctly established in reference to joint makers of promissory notes; and although the previous decisions had been somewhat uncertain it has been recently determined by the decision of this court that where a person signed, as surety, a joint and several promissory note, and it did not

2 The arguments of counsel are omitted.