Chaffe v. Taliaferro

Citations

• 58 Miss. 544

Syllabus

<p>1. Suretyship. Creditor misdealing with security. Effect as to rights of parties.</p> <p>Airs. T. and her son, A. T., gave to 0. & Oo. their joint note for $5,400, secured by a deed of trust on her plantation. Her purpose in giving the note was to obtain from 0. & Co. mercantile advances for the firm of which her son was a member, but she did so upon the agreement of 0. & Co. to transfer to her a note for $1,441 held by them against her son and secured by a mortgage on his homestead. When Airs. T. signed the $5,400 note, the amount was left blank, to be filled out after it should be ascertained to what extent O. & Co. would make advances, they not being present. The extent of the advances was agreed upon between C. & Co. and A. T., and the amount of the note was inserted by Mrs. T.’s agent to cover the advances and the $1,441 note to be transferred to Mrs. T. The $5,400 note was discounted, and out of the proceeds 0. & Oo. paid themselves for the $1,441 note, but retained possession of it, no one demanding it. Some time thereafter 0. & Co., at the request of A. T., formally satisfied the mortgage against his homestead. He then sold his homestead to an innocent purchaser, and the mortgage cannot now;, be enforced. A. T. is insolvent. Mrs. T. never demanded a transfer of the $1,441 note, and never expressed any dissatisfaction at the cancellation of the mortgage until she was called upon to pay her note, several months thereafter. C. & Co. never denied her right to a transfer of the $1,441 note. Suit having been brought upon the $5,400 note, Mrs. T. contended that she was not liable thereon, because of the failure of O. & Co. to transfer to her the $1,441 note, which transfer, as claimed, was a condition precedent to her execution of the note sued on. Held, that the arrangement contemplated by Mrs. T. when she signed the note was substantially carried out, and she is bound by her undertaking; but the $1,441 note became her property by the payment thereof out of the