Clodfelter v. Hulett

Upon Petition eoe a Eeheaeing.

Elliott, J.

— Appellee has filed a petition fora rehearing, insisting that we erred in holding the third paragraph of the answer to. be good.

Counsel assert that we held that an answer by a surety, showing an agreement to release him upon the execution of a mortgage to the creditor by the principal, was good without showing an execution or tender of the mortgage. We neither held, nor meant to hold, any such thing. The question was not presented. Counsel misunderstand both the answer and the opinion. The answer does not present, or profess to present, the question of an agreement for the execution of a mortgage by the principal as a consideration f oían agreement to release the surety.

The case, so far as this precise point is concerned, which is made by the answer, and by the demurrer confessed to be true, is briefly this : That Noah J. Clodfelter, the principal, agreed, in consideration of the appellee’s promise to release his surety, to sell the property for which the note in suit was given; that he did sell it, and that, after such sale, *147two of the notes of the series to which that in suit belonged, were delivered by the appellee to appellant’s principal. There was no agreement by appellant’s principal to himself execute a mortgage, nor was there any undertaking on his part that Bolser, the purchaser, should execute a mortgage. The answer is loosely drawn and would well bear amendment, but there is enough to show the agreement to sell to Bolser, the sale and the consideration of the agreement to sell. Performance on the part of the appellant’s principal is shown, and acceptance of that performance is plainly shown by the fact, that the appellee delivered to Noah J. Clodfelter two of the notes executed to him in payment for the property at the time of the purchase by the said Noah. When it was shown, as it was, that the appellant’s principal had performed his part of the contract, enough was shown to entitle the surety to successfully insist upon the enforcement of the agreement to release.

The case made by the answer is entirely unlike those cited by the appellee. The authorities which he cites declare and enforce an every-day familiar rule, which no lawyer would think of disputing, but they have not the remotest application to the case in hand. Noah J. Clodfelter had fully performed. It was not in his power to compel Bolser to execute to Hulett a mortgage; neither had he undertaken to do so ; but it was in the power of the latter to enforce his right against Bolser. By the agreement, a legal right, capable of enforcement by Hulett, and properly by him alone, was transferred to and vested in him. It was held in Love v. Miller, 53 Ind. 294, that, where a broker procured a contract which was mutually obligatory upon vendor and vendee, he was entitled to his commission. The case proceeds upon the ground that where the party is secured a legal right, capable of enforcement, all was done that the broker was bound to do. There is strong reason for applying this general principle to such a case as the present. Here the principal debtor stipulated for his surety’s release, and the *148creditor acceded to the stipulation, partly performed the contract, and thus obtained a full legal right against the party whom he had agreed to accept as his debtor, in lieu of those originally bound. The principal debtor had done all that he agreed to do, and the creditor got all he had asked as a consideration for the release of the surety. Downey v. Hinchman, 25 Ind. 458.

The consideration of Hulett’s agreement to release the surety was not solely the promise of Bolser to execute the mortgage; it was the sale by the principal debtor. When the sale was made by the latter and completed, so far as it was in his power to complete it, there was full performance, and from that moment the contract for the release of the surety became effective.

The promise of Bolser, made in the tripartite agreement, gave the appellee a complete right of action. If Bolser refused to execute the mortgage as agreed, then the appellee would have an .immediate right of action for the recovery of money. It is a familiar rule, that where a party is entitled to time in which to make payment, upon executing a mortgage or other security, his refusal to execute the security will give the creditor an immediate right of action. Hays v. Weatherman, 14 Ind. 341; Mason v. Toner, 6 Ind, 328.

As indicated in the original opinion, there was no obligation resting upon appellant’s principal to sell, and if he executed, as a consideration of such sale, a promise to release his surety, and the appellee acceded to his demand, and gave the promise demanded, he is bound thereby, even though Bolser, Noah Clodfelter’s vendee, may not have done what he agreed to do.

We are not now dealing with the question whether the answer is or is not faulty for uncertainty. That question can not, in a case like this, be presented by a demurrer; it must be done by motion to make more certain.

Petition overruled.