February 14, 1928. The opinion of the Court was delivered by This action was commenced in January, 1925, in the Greenville County Court on the note hereinafter set out in full and came on for trial March 1, 1926, before Judge Ansel and a jury, and resulted in a verdict for the plaintiff for the amount demanded.
The complaint is in the usual form against an indorser on a promissory note.
The answer sets up a number of defenses, to wit, a general denial; that the defendant was a surety only on the note, and it was so agreed, understood and intended between the parties; that at its maturity the note was not presented for payment, and for that reason the defendant was discharged from liability thereon; that, after defendant indorsed said note, he did not know it was unpaid until December 20, 1924, after Putnam, the maker, was adjudicated a bankrupt; that defendant never saw the note after indorsing it until the reference was held in said bankruptcy matter; that plaintiff, without the knowledge or consent of the defendant, agreed to extend the time for the payment of the note in controversy in this case from August 13, 1924, *Page 391 to November 13, 1924, without the knowledge or consent of the defendant and to his prejudice, and this discharged the defendant from liability thereon; that the plaintiff accepted $20.40 as interest on November 13, 1924, as consideration for said extension; that the plaintiff was guilty of negligence and laches for failing to enforce his legal remedies in the courts against Putnam, the principal, and to reduce his claim to judgment when same was collectible, and delayed action for seven months and four days after maturity date, and until Putnam was adjudicated a bankrupt; that he was then forced to take his place as an unsecured creditor, when he might by due diligence have been a judgment creditor, and therefore secured, and all to the prejudice of the defendant; that the plaintiff is precluded from recovery by his negligence and laches. The plaintiff filed his claim against the bankrupt estate of Putnam, the maker, and therefore elected to proceed against Putnam, and such election has discharged this defendant. A copy of the note follows: "Owings, S.C. May 13, 1924.
"On August 13, 1924, days after date I promise to pay to the order of G.W. Owings $1,000.00 one thousand and no/100 dollars, payable at the Bank of Owings, Owings, S.C. Value received with discount before, and interest after, maturity at the rate of 8 per cent. per annum, payable annually, with 10 per cent. on the amount due as attorney's fees in case payment shall not be made at maturity. The makers, drawers, indorsers, and guarantors severally waive presentment for payment, demand, protest, and notice of protest of nonpayment and dishonor of this note. Due ____ [Signed] A.R. Putnam."
Reverse side: "W.H. Davenport."
It appears that on February 13, 1924, Putnam delivered to the plaintiff his promissory note for $1,000, payable on May 13, 1924, with the endorsement of W.H. Davenport *Page 392 thereon, and that the plaintiff deducted the interest, and paid to Putnam the balance in money; that on May 13, 1924, Putnam delivered to the plaintiff a new note which was a renewal of the indebtedness evidenced by first note. The new note was payable August 13, 1924, for the sum of $1,000, was signed by Putnam, and indorsed by W.H. Davenport, and was payable August 13, 1924, It seems that the first note was delivered to Putnam when the second note was delivered to the plaintiff. This suit is on the second note above set out.
The following are excerpts from the testimony of the plaintiff:
"The note represents actual cash loan. This is a renewal of the first note. * * *
"Q. When the note was first made, what did Davenport say after you let Putnam have the money? A. I was in the mill afterwards to see him with reference to some fertilizer, and he told me Putnam got the money all right, and I said `Yes'; he said `Well, we will see you get your money.' * * * He (referring to Davenport) told me he would pay it and I would get the money; that he did not have the money at that time, and asked me to extend the time. * * * I told Putnam I would renew the note provided Davenport would indorse it again. * * * He (referring to Davenport) admitted he indorsed it, and has never denied indorsing it."
The following are excerpts from the testimony of W.H. Davenport:
"I didn't get any of this money he claimed Putnam borrowed from him, and I didn't intend to borrow any. * * * I indorsed that note for $1,000. I signed that note. Mr. Owings did not come to me at any time during these transactions. * * * Putnam did not come back to me on August 13, 1924. I put my name on the back of two notes each time for $100. I never had any demand upon me at any time by Owings before Putnam went into bankruptcy. *Page 393 * * * The first knowledge I had that the note was not paid was when Owings came to me when Putnam was in bankruptcy. * * * He (referring to plaintiff) did not ask for a payment, and I did not tell him I was going to pay it. * * * I am responsible for $100, all of which I will pay. * * * I do not swear that was my signature on the back of that note. I signed it with a pen for $100, what Putnam said he wanted. * * * It was no use to tell Owings that it was for $100, and not $1,000. I did not tell any one it was for $100. I kept it to tell the jury."
W.C. Freeman, a son-in-law of Davenport, and his wife, Mrs. W.C. Freeman, both testified that they saw the first note indorsed by W.H. Davenport and it was for $100.
Owings in reply testified that he never had a note signed by Putnam for $100.
The defendant has made fourteen exceptions, two based on the rulings of the Court, and twelve to the Judge's charge. Exceptions 1 and 2 may be considered together, and each makes the contention that the Judge in his rulings expressed his opinion, and thereby charged on the facts. Neither of these exceptions can be sustained, for the rulings were not a charge on the facts.State v. Atkinson, 33 S.C. 100; 11 S.E., 693; Autrey v.Bell, 114 S.C. 370; 103 S.E., 749.
Exceptions 3, 7, 8, and 9 may be grouped. By them the appellant contends that the plaintiff agreed to extend the time for the payment of the note in question without the knowledge, or consent of the defendant, Davenport, and this discharged the defendant. Exception 3 also makes the point that the charge was on the facts; but a reference to the charge does not sustain this contention. The maker of the note was not sworn in the case.
There is no testimony showing an agreement on the part of the plaintiff to extend the time for the payment of the note, unless a new note was executed and indorsed by Davenport; *Page 394 hence these exceptions are without merit, and unsupported by any testimony.
Exceptions 4, 5, 6, 10, 13, and 14 may be considered together. By them the appellant contends that his Honor charged on the facts in violation of the Constitution of the State. A reference to the charge shows a misconception of the charge. It was not on the facts, but simply a construction of the law applicable to the case. Said requests further complain of the Judge's charge on the liability of an indorser.
Section 3733, Volume 3, Code of Laws 1922, reads:
"When Dispensed With. — Presentment for payment is dispensed with: * * * Subd. 3, By waiver of presentment express or implied."
See, also, Patterson v. Orangeburg Fert. Co., 117 S.C. 140:108 S.E., 401.
The note in controversy waives presentment, demand for payment, protest, and notice of nonpayment.
Section 3735, Volume 3, Code of Laws, 1922, reads:
"Right of Holder on Dishonor. — Subject to the provisions of this Article, when the instrument is dishonored by nonpayment, an immediate right of recourse to all parties secondarily liable thereon accrues to the holder." First NationalBank of Hartsville v. Wood et al., 109 S.C. 75;95 S.E., 140; L.R.A. 1918-D, 1061; F. M. Bank v.Bank of Hemingway, 113 S.C. 140; 101 S.E., 746.
Exceptions 11 and 12 raise the point that the plaintiff was guilty of negligence and laches in not collecting his said note from the maker, Putnam. This position of the defendant vanishes before Section 3735 Code, supra.
After a promissory note matures, under that Section of the Code, and the decisions construing it, the holder of a negotiable promissory note has immediate right of recourse against all parties secondarily liable thereon. Under the facts and circumstances of this case, the plaintiff would *Page 395 have been entitled to a directed verdict, but for the defense of the defendant that he did not indorse the note offered in evidence.
On this question the jury decided against the defendant; hence the judgment of the Greenville County Court is affirmed.
MESSRS. JUSTICES COTHRAN, BLEASE, STABLER, and CARTER concur.