Holbrook v. Investment Co.

Per Curiam.

It is contended by counsel for petitioners that this court, having no original jurisdiction, is powerless to render the judgment complained of, and that the summary proceedings herein adopted constitute a denial of the right to a day in court and trial by jury. The statute provides, in effect, that if the appeal be abandoned, by a failure to file the transcript within the time prescribed by law, the judgment, so far as it is for the recovery of money, may be enforced against the sureties in the undertaking for a stay of proceedings, as if they were parties thereto (Hill’s Ann. Laws, § 541, subd. 4), and that, if the judgment be given against the appellant, it shall be enlarged against his sureties also, in like manner and with like effect, according to the nature and effect of their undertaking: Section 546, subd. 4, Ibid. The Revised Statutes of New Mexico (§ 5, page 290) contain the following provision: “In case of appeal in civil suits, if the judgment by the appellate court be against the appellant, it shall be rendered against him and his securities on the appeal bond.” The supreme court of the territory, in pursuance of the authority conferred by that statute, rendered judgment on appeal against an appellant and the sureties upon the appeal bond, and, a writ of error having been taken to the Supreme Court of the United States, it was held that no fundamental constitutional principle was involved, and *107 Mr. Justice Bradley, referring to the power of the court of New Mexico to render the judgment, says: “A party who enters his name as surety on an appeal bond does it with a full knowledge of the responsibilities incurred. In view of the law relating to the subject it is equivalent to a consent that judgment shall be entered up against him if the appellant fails to sustain his appeal.” Beall v. New Mexico, 16 Wall. 535 . When judgment is entered against a party, it must be conceded that it would bind him if the court rendering the judgment had jurisdiction of his person and of the subject matter of the suit or action; and, such being the case,, our statutes above referred to in effect provide that when the surety signs an undertaking on appear and for a stay of proceedings he forms a privity of contract with the judgment debtor, and, like his principal, thereby becomes a party to and is bound by the judgment.

Section 540, Hill’s Ann. Laws, so far as it relates to the question under consideration, is as follows: "If the judgment or decree has been given in an action or suit upon a contract, notwithstanding an appeal and undertaking for the stay of proceedings, the respondent may proceed to enforce such judgment or decree, if, within ten days from the time the appeal is perfected, he file with the clerk an undertaking, with one or more sureties, to the effect that if the judgment or decree be reversed or modified the respondent will make such restitution as the appellate court may direct.” It will be observed that this section does not, in *108 direct terms, confer upon . this court authority to render judgment against the sureties on such an undertaking when the judgment or decree is reversed or modified, but we think the power is fairly implied therefrom, and particularly so when the general policy of the law, as manifested by sections 541 and 546, is considered. The appellant is required to include in the transcript a certificate of the undertaking executed by the respondent, the names of the sureties, and the amount thereof, if the same is specified (section 541, subdivision 1, Hill’s Ann. Laws); and it would seem from this provision that the sureties, by signing such an undertaking, became parties to the judgment or decree upon the reversal or modification of which they agree to make such restitution as may be directed, thereby authorizing this court to render judgment against them in accordance - with the conditions stated in such certificate. In Ah Lep v. Gong Choy, 13 Or. 429 ( 11 Pac. 72 ), the court, in considering these provisions of the statute, said: “We think the clerk is required to certify as to both undertakings, where two are given, and that the object of the requirement is to enable the appellant, in case the judgment or decree is reversed, and it has been enforced by the giving of such undertaking, to obtain judgment against the sureties upon the respondent’s undertaking. It amounts to this: If the judgment is affirmed, the respondent is entitled to have the judgment entered against the sureties on •the appeal; if it is reversed, the appellant is entitled, if it has been enforced, to have a judgment of *109 restitution entered against the sureties upon the counter-undertaking; and in case it has been enforced, and the judgment is affirmed, the prevailing party would only be entitled to judgment for the costs upon appeal.” We think this is a correct statement of the rule, and that the power is conferred upon this court to render judgment against the respondent and his sureties on such undertaking, when the judgment ordered is reversed or modified and a restoration is directed.

It is contended that the undertaking in question was executed in consideration of the enforcement of the judgment; but, inasmuch as only one-half of the amount specified therein was collected, there was a failure of the consideration, the contract of the sureties was altered without their consent, and they are thereby discharged from all liability in consequence thereof. While the rule is well settled that the contract of suretyship is always strictly construed in favor of the surety, and cannot be extended by implication beyond the clear and absolute terms of undertaking ( 24 Am. & Eng. Enc. Law, 749 [1st Ed.] and notes), it is manifest that there was not, in the case at bar, an entire want of consideration, but the failure in that respect was pro tanto only, and caused by the act of the court, and, such being the case, the petitioners are liable to the extent of the money so collected: 2 Brandt on Suretyship, § 434. If this rule were otherwise, then the failure or neglect to collect the smallest fraction of the judgment would exonerate the sure *110 ties. A mere statement of such a possible result is sufficient to show the fallacy of the position.

It is also contended that the payment of the money so collected to Riggin was not a payment to the firm of Riggen & Holbrook, and for this reason the sureties are not liable on the undertaking; but there is nothing in the record to show that Riggen was not the proper person to whom the money should have been paid, and inasmuch as he, as principal, signed the firm name to the undertaking, of which fact the petitioners had knowledge at the time it was executed, we think there is no doubt about their liability, for which reason their petition is denied.

Petition Denied.