Breves v. Auer

*666OPINION

By'MONTGOMERY, J.'

There are-numerous assignments o'f .'error 'set forth in the petition in error but in view of the conclusion of this -court all of- them may be ignored excepting only the one; herein discussed,'-to-wit, — was the judgment of the lower court manifestly contrary to the weight of the evidence-?

It.is contended on behalf of plaintiff in error,' Breves, that ■ at the timé' the -note was presented to him and the guaranty signed, no payee was named1'in the note but the agreement was that it should be jpayable to the National City • Bank'-for. the purpose of enabling Scheible to withdraw' from that bank certain securities then held by it as.'collateral-for his-obligations'-.to the bank.

It is contended further that upon Schei■bleis.'.failure to make this arrangement with thé--bank-'.lie; then inserted his • own 'name ■as payee.-in the note. If is unquestionably tire .fact .'that.', the. defendant in error advanced to. Scheible- the sum of $600.00 and that .this note ip , controversy was' then turned- over to him as security fdr payment of-this $600.00. Subsequent to the obtaining • of • the judgment Upon the cognovit note, proceedings were'had in aid of execu-tion and a sum in- excess of '$300.00;' the property of Charles Breves, was obtained by this' proceeding'and-applied upon the claim of Auer. ' •

From a reading of-'the evidence taken in the Common Pleas Court, • we are clearly of the opinion that' Charles Breves at -the time- he 'signed this guaranty upon the note did so with the understanding that it 'Was to be used for the purposes' hereinbefore indicated as claimed by him. He was clearly an accommodation guarantor such as is contemplated by the statute arid received nó value therefor.'

■ It is equally clear "to us'that Auer is mot a holder in due course arid is simply a pledgee -'of" this noté holding it for the purpose-of ^securing the amount advanced by him to-Scheible.

It was held in' the case of Handy v Sibley, 46 Oh St 9 in the first branch of the syllabus as follows:

“The holder of an accommodation note indorsed to him as collateral- security, can recover against the accommodation maker no more than the amount intended to be secured thereby.”

■ It is contended that Auer is entitled .to enforce ■ the- claim ■ for the entire. amount due and retain any Surplus for the benefit of the pledgor, • but as stated in-49 Corpus Juris 1031 (321). 8,—

“Where the obligor proves a. defense not available-'as a bar to recovery by the pledgee but good as against -the- pledgor;- the pledgee will be''allowed to recover only to the extent of the - debt for which- he holds the collateral''as security.” :

It stands to reason that the holder of a large'claim, which .is. however subject to-a defense,' cannot pledge that claim as security for a' debt, the amount "of which debt is ■ a mere fraction of-- the amount ■ of the claim, and thereby- through the pledgee do What'the-.original holder of: the- claim could not do'himself: 1 ■

We are unanimously of the opinion that the judgment of'the-.Common Pleas Court was manifestly against the . weight of- the evidence: and’- therefore contrary to law; that-' the defendant, -in. error,- Auer, is entitled tO'-recover from plaintiff , in error, the amount1-;Of $600.00 .,-with-interest accruing thereon from the* time .of. the loan of this *667sum by him to Scheible, subject to a credit thereon of the amount' received by him as the- result of- proceedings -instituted in--aid of execution, and counsel can -figure . the amounts in accordance: with this'-finding.It is the order of this court that-there be remitted from the- judgment entered by the Common Pleas Court-all-in .-.excess of the amount herein indicated :as due-Auer, to- be figured as indicated,- and that, if- he accepts- such remittitur there may be judgment for him accordingly but- that if such not. be accepted by ..him. the judgment of the Common Pleas .Court .will .be reversed as against the weighkof .the evidence. • Exceptions-.may be noted. ■ ■ •

RICHARDS' arid LEMERT, JJ, concur in judgment. .....