Henry L. Van Wyck & Wm. A. Kobbe v. John McIntosh.
(Before Duer, Campbell, & Paine, J.J.)
December 20, 1852 ;
March 26, 1853.
On the trial of this action, in. which the defendant was sought to be charged, as the endorser of a promissory note, J. M. was offered as a witness on his behalf, and was rejected, on the ground that he had guaranteed the payment of the note, if the endorsement should be proved to be genuine, and had deposited the sum due on the note in the hands of a third person, under an agreement that it should be paid over to the plaintiffs, in the event of their obtaining a verdict.
Held, that he was not a person for whose immediate, benefit the suit was defended within the meaning of the Code, and was, therefore, notwithstanding his interest, a competent witness.
On this ground a new trial granted.
Motion for a new trial upon a case. The action was against the defendant, as the first endorser of a promissory note for $2,045/T5T, purporting to have been made by Messrs. McIntosh & Co., payable to his order. It was defended on the ground that the endorsement was forged. On the trial, which took place before Mr. Justice Sandford, and a jury, in May, 1852, many exceptions were taken to the ruling of the judge, which it is deemed unnecessary to state, as the decision of the court in granting a new trial, proceeded on the single ground that the testimony of a particular witness, who was offered to be examined on the part of the defendant, had been improperly rejected.
The statement in the case, in relation to this witness, is as follows:—
The defendant’s counsel called as a witness,
John Mansfield,
who was duly sworn, whereupon the plaintiff’s counsel objected to the witness as incompetent, on the ground of interest, and in support read the following papers:
“ For value received, I hereby guarantee to Mr. William *87Kobbe the punctual payment, at maturity, of a note of Thomas McIntosh & Co., drawn in favor of John McIntosh, and'by him endorsed, dated Hov. 13th, 1850, on six months, and due on the 13th and 16th of May next, for thirteen hundred and thirty-seven -//ó dollars.
“ And another note, dated Hov. 14th, 1850, at six months, drawn by the said Thomas McIntosh & Co., in favor of John McIntosh, and by him endorsed, due the 17th of May next, for two thousand and forty-five r\\ dollars, in such a manner its if the same notes were endorsed by me. Dated New York, March 31st, 1851.
(Signed) “ John Mansfield.”
“ Hote due May 16, $1,337 40 “ “ “ 17, 2,045 35
. $3,382 75”
“ $2,045.35.” “ New York, Hov. 14, 1850.
“ Six months after date, we promise to pay to the order of Mr. John McIntosh, t.wo thousand and forty-five dollars, at Ho. 133 Pearl street. Value received.
(Signed) “ Thomas McIntosh & Co.”
(Endorsed) “ John McIntosh.”
“The undersigned having for a valuable consideration severally guaranteed to William Kobbe, one of the firm of Van Wyck & Kobbe, the punctual payment of a promissory note, of which and of the endorsement thereon the foregoing is a copy, and said note not having been paid, and said Van Wyck & Kobbe being the owners and holders of said note, having demanded of us severally the payment thereof, and said John McIntosh having denied that he endorsed said note, and we being severally liable to pay the same if the said endorsement is genuine, and beihg desirous to have that question settled in an action against said John McIntosh, as endorser thereof: How, in consideration of the premises, and in consideration also that said Van Wyck & Kobbe will commence an action against said John McIntosh, as endorser of said note, and prosecute such action to final judgment, which we hereby *88severally request them to do, we promise and agree to and with said Van Wyck & Kobbe, that in the event they shall recover a final judgment against said John McIntosh, as endorser of said note, or against his executors or administrators, that we will, upon the recovery thereof, pay the amount thereof to said Van Wyck. & Kobbe, their executors, administrators, or assigns, and the costs and reasonable counsel, fees which they may pay or become liable to pay in prosecuting said action to judgrhent- by reason thereof. And said Yan Wyck "& Kobbe having agreed in consideration hereof, and of the security herein referred to, to commence and prosecute such action to final judgment, we agree to deposit with Messrs. Haggerty, Draper & Jones, of New York city, the sum of two thousand and forty-six dollars and eleven cents, at interest and upon trust; that it shall remain so.deposited until a final judgment shall be rendered in said action; and, upon the rendition of a final judgment therein, that such moneys, and all interest that may have accrued thereon, shall be paid to said Yan Wyck & Kobbe, their executors, administrators, or assigns, if the said judgment shall be in favor of.said Yan Wyck & Kobbe, their executors, administrators,-or assigns.
“ Dated New York, May 28, 1851.
“ John Mansfield,
“ H. Robinson.”
“ $2,046tVV
“New York, June 4, A.D.1851, received of John Mansfield, within mentioned, on interest, at'the rate of six per cent, per annum, upon the trusts in the within agreement specified, two thousand and forty-six dollars and eleven cents, which sum, and the interest which shall at the said rate have accrued thereon, at the time final judgment shall be rendered in the action in said agreement mentioned, we agree to pay to Yan Wyqk & Kobbe, if such judgment shall be in their favor, and, if it be against them, to then pay the same to said John Mansfield.
“ Haggerty, Draper & Jones.”
The judge held the witness to be incompetent, and to his decision the counsel for the defendant excepted.
*89The jury found a verdict for the plaintiffs for the amount of the note with interest, to set aside which, a case, containing the evidence and the exceptions was made, which was ordered to be heard in the first instance at General Term.
It was now fully argued by the counsel of the respective parties, upon the evidence and the exceptions, but for the reasons before given, the arguments are omitted.
E. Sandford for defendant.
N. B. Blunt for plaintiffs,
who, in support of the position that the testimony of Mansfield was properly rejected, cited Davies v. Crum, 4 Sand. S. C. Rep. 355.
Br the Court. Duer, J.
The witness, Mansfield, had certainly a direct interest in the event of the suit, since it was manifestly the understanding of the parties that he was not to be liable at all upon his guaranty, unless the endorsement of the defendant was proved to be genuine; but, although thus interested, he was not a person for whose immediate benefit the action was defended, within the meaning of the Code (§ 399), according to that interpretation of its meaning which we have heretofore adopted (Catlin v. Hansen, 1 Duer, S. C. Rep. p. 319). His interest, therefore, was not a ground of exclusion. He was not a cestui que trust, nor had he given an indemnity to the defendant, thus making himself the real and sole party in interest. The suit was prosecuted with the intent that the judgment, should a judgment be obtained, should be enforced against the defendant, and it was defended by him, not at the request of, nor for the benefit of Mansfield, but upon his own account, and with a sole view to his own protection.
The case would be wholly different were it understood that the moneys deposited by Mansfield and Robinson shall be applied to the satisfaction of a judgment against the defendant, so as to exonerate him entirely from its payment; upon this supposition the action would be defended for their immediate benefit, and their benefit alone. But such is evidently not the meaning of the agreement between them and the plaintiffs. The intention of the parties, we cannot doubt, is that if a judg*90ment shall be obtained against the defendant, Mansfield and Robinson shall succeed to the rights of the plaintiffs, and be entitled to enforce the judgment for their own reimbursement. Had they paid the note as guarantors, without requesting this action to be commenced against the defendant, as endorser, they might have justly claimed a transfer of the note, so as to have enabled them to compel its payment by the defendant. To save themselves from a suit upon their guaranty, and from the necessity of commencing an action in their own name against the defendant, they entered into the agreement with the plaintiffs, but there is no reason to suppose that they meant to deprive themselves of the right of ultimately resorting, for their own protection, to the liability of the defendant; and it would be unreasonable to give this construction to their agreement. Upon the other questions, that were so ably discussed upon the hearing, we are not fully agreed, and therefore decline to express any opinion in relation to them, but we all agree, for the reasons that have been given, that the testimony of Mansfield ought to have been received. He was interested, but not incompetent.
There must, therefore, be a new trial, with costs to abide the event.