Farmers' Natl. Gold Bank v. Stover

Citations

• 60 Cal. 387
• 1882 Cal. LEXIS 474

Syllabus

<p>Promissory Note—Sureties—Pleading.—In an action upon a promissory note signed by S. and L. & S., the latter pleaded that they executed , the note as sureties of, and for his accommodation, which fact the plaintiff well knew.</p> <p>Held: This is not an issuable averment that the defendants contracted with the bank in the capacity of sureties for their co-obligor; it was incumbent upon them in order to set up the defense (under § 2832 C.C.), that they executed the note as sureties, to aver and prove that the payee of the note not only knew of the fact of suretyship between them and their co-obligor, but consented to deal with them in that capacity.</p> <p>Id.—National Banks—Interest.-—It is no defense to an action on a note made to a national bank, that the bank knowingly took a greater rate of interest than allowed by law; the remedy in such a case is to recover back twice the amount paid.</p> <p>Id.—Id.:—Id.—National Banks in this State may charge and receive such rates of interest as may he. agreed upon in writing, pursuant to § 1918 0. 0.</p> <p>Id.—Payment—Novation—Variance—Amendment of Pleading.—Under the issue of payment, evidence was introduced by L. & S. tending to prove that S. executed and that the bank took as a substitution for and in full payment and satisfaction of the note sued on, his individual note secured by mortgage on his homestead and other property, and the evidence being objected to as inadmissible under the pleadings, asked leave to amend their answer so as to allege the facts proven by the evidence; but the Court excluded the evidence and denied the motion to amend.</p> <p>Held: If the note and mortgage were in fact taken as a substitute for the note in dispute with the intent of extinguishing the obligation of it or releasing the parties to it, the transaction constituted a defense by way of novation under §§ 1530-32 C. C.; and conceding the evidence to have been inadmissible under the plea of payment, the Court should have allowed the