Thompson v. Brown

ELLISON, J.

On December 28, 1889, George M. Brown executed a non-negotiable note for $600 to George W. Yowler. On the back of the note the name, J. F. Tyler, is indorsed. Both Brown, the payor, and Yowler, the payee, died and afterwards plaintiffs became the owner of the note after its maturity. Plaintiffs presented it for allowance to the probate court where it was allowed. On appeal to the circuit court the plaintiffs again prevailed. The defense is the statute of limitations. The plaintiffs seek to avoid the statute by payments made by said Tyler and indorsed on the note. A question arose whether these payments were made by Tyler in such capacity as to keep the note alive as against Brown, the maker. It was agreed by the parties that Tyler would testify that he indorsed his name *528 on the’ back of the note after it was executed by Brown to Yowler, and as a guarantor, and Brown’s estate, through counsel, now insists, that putting his name upon the note in that way made him a guarantor and not an indorser or maker; and that a payment by a guarantor did not toll the statute as to the maker. But the plaintiffs objected to the competency of Tyler to testify on the ground that Yowler, the payee of the note, ■was dead. The trial court sustained the objection. The correctness of this ruling is presented for decision.

There is no doubt but if Tyler was a competent witness the defendant would have established that he was a guarantor of the note, since while the presumption is that signing on the back of a note to which he is a stranger makes such signer a maker, yet if he sign after the note is executed he is a guarantor. [Adams v. Huggins, 78 Mo. App. 140 .]

If he was a guarantor, the payments made upon the note by him will not arrest the running of the statute of limitations in favor of the maker. The- guarantor is not a joint obligor on the same contract, for his contract is separate and distinct from the undertaking of the maker. [Maddox v. Duncan, 143 Mo. 613 ; Corbyn v. Brokmeyer, 84 Mo. App. 649 ; Adams v. Huggins, 73 Mo. App. 140 .] While it is true that when the name of a stranger to the note- appears indorsed upon the back thereof he will be presumed to be a maker; yet such presumption will not stand against evidence to the contrary; the real character of his obligation may be shown. [Herrick v. Edwards, 106 Mo. App. 633 .]

The question then may be stated thus, was Tyler, the living guarantor, a competent witness against Yowler the deceased payee, or as applied directly tO' this case, against these plaintiffs whose claim, as assignee of the note, comes through Yowler? The statute (section 4652, Revised Statutes 1899) reads as follows: “In actions where one of the original parties to the contract *529 or cause of action in issue and on trial is dead . . . the other party to such contract or cause of action shall not he permitted to testify either in Ms own favor or in favor of any party to the action claiming under him,” etc.

It will he noticed that the statute does not entirely refuse permission to the living party to testify. It only disqualifies the living witness from testifying to matters in Ms own favor. The terms of the statute do not disqualify him from testifying against himself, nor to matters which are of no concern to him and about which he can have no interest. The object of the statute was to place the dead and living parties upon equality, so that the latter could not have advantage of the former; and it sought to accomplish this by disqualifying the latter from aiding himself by testimony in favor of himself. So it has been held in two' opinions by Judge Romb.auer that a party is only disqualified from testifying to matters in his own favor. [Bank v. Hunt, 25 Mo. App. 170 ; Ford v. O’Donnell, 40 Mo. App. 51 .] Those cases are supported by Angell v. Hester, 64 Mo. 142 ; Ring v. Jamison, 66 Mo. 424, 429 ; Meier v. Thieman, 90 Mo. 433 , and Scott v. Burfiend, 116 Mo. App. 71, 75 . So it is the law that a witness, otherwise disqualified, may be called to testify against his interest. [Matter of Potter, 161 N. Y. 87, 88 ; Carpenter v. Soule, 88 N. Y. 257, 258 ; Neish v. Gannon, 198 Ill. 223 .] And though he be interested, the opposite party may call him. [Morton v. Jackson, 1 S. & M. (Miss.) 494; Ainsworth v. Stone, 73 Vt. 101 .] It follows that the statute proviSr ion above quoted does not disqualify a witness to testify concerning matters about which he can have no interest even though the other party is dead. The Supreme Court held that if his interest was evenly balanced for and against himself, he was competent under the common law. [Bridges v. Bell, 13 Mo. 69 , and a like ruling was made in the Supreme Court of Georgia: Lasseter *530 v. Simpson, 78 Ga. 61 .] And this, under a statute similar to ours. [Harrison v. Perry, 86 Ga. 813 .] If he had no interest, there is nothing to- be said in his favor and consequently he is not testifying “in his own favor.”

This brings us to consider whether the witness Tyler could have had any interest in the case before us. He was not a party to the record and while that alone would not prevent his disqualification, yet it tends to show that he was not to be immediately affected by the result of the litigation. From the statement already made it will be seen that plaintiffs seek to sustain the life of the note by the payments which were made thereon by Tyler within the period of limitations. As already shown, Tyler was a guarantor and if those payments were made by him in that capacity, they did not have the effect to keep the note alive as to the maker, yet they would do- so as to Tyler himself. As stated by counsel for the estate, if Tyler made the payments either as guarantor or co-maker with Brown, the note would not be barred as against him and a judgment could be recovered against him whether he executed the note as principal or guarantor. Nor can the result of this action affect his liability. If these plaintiffs lose in this contest, it does not prevent them from obtaining judgment against Tyler. If they prevail in this action, it will be upon the theory that he and Brown were comakers and a judgment against Brown’s estate would not bar a judgment against Tyler. It is therefore apparent that Tyler had no interest to- subserve and that his testimony could in no event be taken to be in his own favor.

It is true that in some situations it would be to Tyler’s interest to make himself a guarantor instead of a co-maker, as in the former character he could go upon the maker for the entire sum which he might pay; Avhile in the latter he could only recover what he paid in .excess of his own share. But such selfish interest *531 does not apply to Tyler under the facts of this case for the following reason.

At the time he was offered as a witness more than five years had elapsed since his last payment as guarantor and consequently, his action against the makers for reimbursement was barred, since it is necessary that he institute his action within that period. Upon payment of the* principal’s debt by the guarantor an implied obligation arises on the part of the principal to reimburse the guarantor upon which the latter has a cause of action. But the statute of limitations of five years applies to him the same as to a surety. [Singleton v. Townsend, 45 Mo. 380 ; Burton v. Rutherford, 49 Mo. 255 ; Huse v. Ames, 104 Mo. 97 ; Halliburton v. Carter, 55 Mo. 435 ; Bauer v. Gray, 18 Mo. App. 164 .]

Plaintiffs cannot better their position by the suggestion that Tyler could now pay the balance on the note and thus revive it so that he could go upon the makers for the whole sum he has paid. For since his payments as guarantor have not kept the note alive as against the makers, it is barred as against them, and the law is that in order for a guarantor to hold the principal his payment must have been made upon a valid and subsisting obligation of the principal. If the latter is discharged by the statute of limitations there is no liability on the guarantor.

We do not regard the points made by plaintiffs, including the suggestion as to no affirmative showing of a consideration moving to Tyler for his guaranty undertaking as affecting what we have said. It follows that the trial court erred and the judgment is reversed and cause is remanded.

All concur.