This was an action against A.F. Stuhldreher, an indorser on a promissory note, who, while the payee of the note, was in fact an accommodation indorser. Presentment and notice of dishonor was not duly made. If notice of dishonor was not waived, the judgment against such indorser is erroneous.
There was no implied waiver, and the only waiver claimed was an express waiver. There was no waiver or reference to a waiver on the face of the note.
When the note was executed, there was printed on the back and across one end thereof the words *Page 389 "Waiving demand of payment and notice of nonpayment," but the indorser did not sign under said printing. A copy of the back of the note is as follows:
[EDITORS' NOTE: NOTE IS ELECTRONICALLY NON-TRANSFERRABLE.]
The claim of the defendants in error is that said printed waiver on the back of the note is a part of the contract and is, in legal effect, embodied in the instrument the same as if it appeared on the face of the note before the signature of the maker, and that by signing the indorsement on the back of the note said indorser expressly waived demand and notice.
It is conceded that a waiver printed in the body of a note, above the signature of the maker and purporting to bind indorsers, is effectual for that purpose. *Page 390
And before the adoption of the Uniform Negotiable Instruments Law it was quite generally, though not universally, held that where the waiver was on the back of the instrument and was placed there before the note was signed and delivered, it should be given the same effect as if it appeared on the face of the note, and be held to bind all indorsers.
Likewise, the general rule was that if the waiver was placed on the back by an indorser, after the note was signed and delivered, it bound him and all subsequent indorsers; but some cases held that it bound only the indorser who placed it thereon.
By the Uniform Negotiable Instruments Law, it was attempted to adopt a definite, universal rule in reference to these matters, which in this state is Section 8215, General Code, as follows:
"When the waiver is embodied in the instrument itself it is binding upon all parties; but when it is written above the signature of an indorser, it binds him only."
It seems to us that embodied in the instrument means "embodied in the original contract," and that detached words on the back of the instrument at the time it is issued are not embodied in the contract expressed on the face of the instrument.
A waiver may be contained in the body of the instrument, or in an indorsement thereon; ordinarily, the contract evidenced by a promissory note is expressed upon its face at the time it is issued, and a waiver printed on the back of the note when it is issued is of no force and effect until there is an indorsement placed on the back of the note, in such a manner as to adopt such waiver; usually, when an indorsement is placed on the back of the note, new parties become interested and new contract *Page 391 relations are created; this statute recognizes and provides for these two classes of waivers — those appearing on the face of the note, and those appearing on the back of the note.
If those on the back are embodied in the instrument so as to be the same as those on the face, then there is but one class and there is no class to which the second clause of said section may be applied.
We are of the opinion that, under this section, waivers which appear on the face of the instrument are the only ones which can be considered as embodied in the instrument, and that waivers on the back, placed thereon before the instrument was issued, and not referred to on the face of the instrument, should no longer be given the same effect as waivers on the face of the instrument, but should be considered in the class referred to in the second clause of Section 8215, General Code. Mooers v.Stalker, 194 Iowa 1354, 191 N.W. 175.
Defendant in error places reliance upon Farmers' Bank ofKentucky v. Ewing, 78 Ky. 264, 39 Am. Rep., 231, but that case was decided long before 1904, when Kentucky adopted the Uniform Negotiable Instruments Law.
The waiver in the instant case was not "written above the signature" of the indorser, and he did not sign under the waiver. There is absolutely nothing in the situation to indicate that the indorser adopted said printed waiver as his own; on the other hand, all of the circumstances indicate that he did not intend to do so. If he had signed under the waiver, even at the other end of the note, that might have been some indication of an intention to be bound by the waiver, but, apparently *Page 392 to avoid such an inference and repudiate such an intention, he signed not only at the other end of the note, but across it, in a position reverse to that of the printed waiver.
Judgment reversed and final judgment for plaintiff in error.
FUNK and PARDEE, JJ., concur.