« PreviousContinue »
10. Suit against obligor or maker must be in the proper place.
The suit is to be brought in the proper county as well as in proper time. It may be advisable for the assignee before commencing it, to make enquiry to ascertain the maker's place of residence. Burr v. Morrison, 7 B. Monroe 132.
The suit may properly be brought in the county in which the obligor had been residing before his absence from the state, if such absence was expected to be, and was in fact, temporary. Bard v. McElroy's adm'r, 6 B. Monroe 417.
If the assignment be of a note or bond of a person known at the time to be a resident of another state it must be understood to be within the contemplation of the parties that the assignee shall pursue the maker, by suit in the state where he resides. Dulany v. Hodgkin, 5 Cranch 333; Deane v. Scholfield, 5 Leigh 386; Simpson v. Daniel, 1 B. Monroe 250. A suit in the state wherein one of the makers resides and wherein the other was served with process in a transient visit is not enough; for the estate of the latter must be presumed to be where he resides. S. C.
11. Suit brought against obligor or maker must be diligently prosecuted.
In whatever place the suit may be against the maker, such suit must not only be brought in a reasonable time but must also be prosecuted in a judicious manner. Barksdale v. Fenwick, 4 Call 492; Bronaugh v. Scott &c. 5 Call 78; Deane v. Scholfield, 6 Leigh 386.
The assignee who, at the term at which he is entitled to judgment, demands it, is not blameable because the court improperly continues the case and postpones the judgment. Clark v. Prentice &c. 3 B. Monroe 587. But if he at that term, instead of taking judgment, make a purely voluntary and gratuitous agreement to continue the cause, this, in effect, is the same thing as a failure to bring the suit to that term, and equally fatal on the question of diligence. Mair v. Smith, 7 Id. 192.
He must use due diligence not only in commencing the suit but in following it up; for commencing the suit in time would avail but little if it afterwards, by his negligence, should hang on the docket until the principal became insolvent. Sayre v. Bayless, 1 B. Monroe 305.
It was clear that due diligence was not used in Deane v. Scholfield, 6 Leigh 386. There the note was executed in Fairfax county on the 10th of June 1818, was assigned on the 18th of that month, and became due on the 12th of August in that year. In the summer of the same year the maker removed to Maryland, and established himself there within less than 20 miles of his former place of residence; having in possession when he removed, and continuing for some time to hold, two slaves as well as some household furniture. More than 18 months elapsed before the assignee brought suit in Maryland; he then failed for another year to file his declaration; and in the meantime the maker became insolvent.
When the suit against the obligor is brought in due time, and duly prosecuted, as it was in Whaley v. Vanhook, 4 B. Monroe 271, although in that suit bail, which might have been, was not required, the assignee may nevertheless recover against the assignor. Harrison's adm'r v. Raine's adm'x, Munf. 451; Caton &c. v. Lenox &c. 5 Rand. 31.
12. After judgment there must be due diligence in issuing execution to the proper county.
When judgment has been obtained against the obligor or maker, it has been a question, in Kentucky, whether there is, or should be, any established rule prescribing the number of days which may or may not intervene between the expiration of 10 days after judgment, when the execution might by law be issued, and the time when it actually issued, and was placed in the officer's hands. 3 B. Monroe 588. There seems to be no other rule on the subject than the general requisition of due diligence in prosecuting the remedy against the obligor or maker. Id.; 1 B. Monroe 305; Passmore v. Prather, 9 Dana 57.
In one case an interval of three months was held too long. Trimble &c. v. Webb &c. 1 Monroe 100. In another a delay of about one month was so explained as to shew no want of diligence. Clark v. Prentice &c. 3 B. Monroe 590. In two other cases the action against the assignor was defeated by a delay to issue execution for 7 days after the expiration of the 10; the delay in these cases being unaccounted for. Bard v. McElroy's adm'r, 6 Id. 419; Mair v. Smith, 7 Id. 192.
If the debtor reside in the state, the execution should be sent to the county in which he resides; that being the county in which his property is presumed to be. Buck &c. v. Morrison, 8 B. Monroe 133.
13. If execution be levied on property, due diligence must be used to obtain the value of that property.
In Kentucky, if it appear by the return of the sheriff that property was levied on and taken out of his possession by a writ of replevin sued out by a third person, it must then be shewn what has become of this property. The assignee has no right to abandon it; he must defend the replevin and subject it if he can. Unless it be shewn that it was not liable, he cannot, upon a return afterwards of nulla bona, sustain an action against the assignor. Levi v. Evans, 7 B. Monroe
If the debtor give a replevy bond with sureties, and upon executions issued at the end of three months, it appears that none of the obligors have any property, there is a presumption that the sheriff took insufficient sureties, and has, by his failure in duty, become liable for the debt; and in such case the assignee must proceed against the sheriff before he resorts to the assignor. Wright v. Strange, 5 B. Monroe 252.
In Virginia, generally, the assignee is not required to proceed against a sheriff in order to take the chance of fixing upon him a malfeasance which may charge him with the debt. If the sheriff be guilty of a malfeasance for which the assignee is not bound to pursue him, the wrong done by the sheriff is a wrong to the assignor, who may have his action on the case. Smith &c. v. Triplett &c. 4 Leigh 590.
14. If there be a return of nulla bona, that generally au thorizes assignee to sue assignor.
If on a fieri facias directed to the sheriff of the county in which the obligor resides there be a return of nulla bona, that is generally sufficient. Roane, J. in Barksdale v. Fenwick, 4 Call 503. Notwithstanding the obligor may in fact have had property which was capable of being levied on, but was not levied on, the assignor is, on such return, generally, bound to pay the money, unless it be proved that the assignee knew of there being such property. Goodall v. Stuart, 2 H. & M. 205; Smith &c. v. Triplett &c. 4 Leigh 601; McFadden v. Finnell &c. 3 B. Monroe 122; Larman v. Neete, Id. 165. If he did know of it, he should pursue it before proceeding against the assignor. Robertson, C. J. 3 B. Monroe 165; Levi v. Evans, 7 Id. 116.
If the return upon the fieri facias, instead of being a return of nulla bona, shew that only a certain sum could be made, it may yet be shewn that between the date of that
execution and its return, the judgment debtor took, in another case, the oath of insolvency, and when this is shewn, it is immaterial for the assignor to shew that the debtor had other property, unless he prove that the assignee knew of it. Smith &c. v. Triplett &c. 4 Leigh 601, 2.
15. Effect of taking the debtor under a ca. sa.
After a return of nulla bona, it is not incumbent on the assignee to sue out a ca. sa. in order to entitle himself to an action against the assignor, yet if he does take out such execution, and under it the debtor is taken in custody, it would be premature to sue the assignor when, for aught that appears, the debtor is still in custody, or may have paid the debt. Johnson v. Hackley, 6 Munf. 448. If it appear that the officer has wilfully and negligently suffered the debtor to escape, and the officer be liable for the whole amount of the execution, then the creditor should prosecute his legal remedy against the officer before resorting to the assignor. Johnson v. Lewis, 1 Dana 182.
16. An assignee who has a lien on the debtor's property, by deed or otherwise, should pursue it before he proceeds against the assignor.
The note may purport to have been given in consideration of the purchase of land. The mere fact of such being the consideration, will not affect the liability of an assignor when there is no lien on the land. Whaley v. Van Hook, 3 B. Monroe 271. But when there is a lien, and the assignee knows of it, he should pursue that lien to exhaustion before he pursues the assignor on his personal liability. Morrison v. Glass, 4 Id. 240.
If it appear that while the assignor held the note, the debtor executed to him a mortgage on property apparently sufficient to satisfy the debt, and that the assignee was apprised of it before he brought suit on the note, and was informed by the mortgagor that he would make no defence against a suit to foreclose the mortgage, the assignee should pursue the mortgaged property and test its insufficiency to pay the debt. Miles v. Gray, 4 B. Monroe 417.
18. Rule in Pennsylvania and New York as to right of action on assignor's contract of guaranty.
The rule adopted in Virginia on the implied undertaking in
Mackie's ex'or v. Davis, 2 Wash. 226, and Barksdale v. Fenwick, 2 H. & M. 113, note, cited ante, p. 271 and 280, was in Pennsylvania considered in point on an express agreement in the assignment of a bond that the assignor would stand security to the assignee for the payment of it, Rudy v. Wolf &c. 16 S. & R. 79; or would guarantee the payment of it, Johnston v. Chapman, 3 Penrose & Watts 18; Joett v. Hoge, 2 Watts 128. The assignor was considered not as a principal debtor, liable in the first instance to the assignee, but as undertaking to him for the payment of the money if due dili gence was used to recover it from the obligor. It matters not whether the assignment be made before or after the time fixed for payment. In either case the assignor is liable on the assignment only when the obligor is insolvent and due diligence has been used by the assignee to enforce payment. Demand on the obligor and refusal by him to pay, though coupled with the fact of his non-residence, are not enough, when there has been given as collateral security a mortgage to which the assignee might have resorted. 3 Penrose & Watts 18. But there is a right of action on the assignment if nothing was due on the instrument assigned, Ayres v. Findley, 1 Barr 501; or if it had become due at the time of its being warranted to be collectable, and the maker was then insolvent, McDoal v. Yeomans, 8 Watts 361; or though it had not become due at the time the guaranty of its payment was made, if the maker was insolvent at its maturity. Campbell v. Knapp, 3 Harris 27. It has been so held, although the guaranty was not inserted in the instrument of assignment; but merely proved by parol. Overton v. Tracey, 14 S. & R. 327.
In New York, an undertaking to guaranty the collection of the money specified in a note, or to warrant its collection, or a warranty that the note is good, is equivalent to a guaranty that the note is collectable by due course of law. Taylor &c. v. Bullen, 6 Cow. 624; Cumpston v. McNair, 1 Wend. 460; Lamourieux v. Hewit, 5 Id. 307; Curtis v. Smallman, 14 Id. 231. On such a guaranty the parties to the note must be prosecuted with due legal diligence before resort is had to the guarantor. Moakley v. Riggs, 19 Johns. 69; Kies v. Tifft, 1 Cow. 98; Thomas v. Wood, 4 Id. 173; 1 Wend. 461.
19. Whether assignor or guarantor is liable to any other than the party with whom he contracted. Rule in equity. Ef fect of statute of Virginia.
Generally the liability of a guarantor is not as an endorser