On Petition for a Rehearing.
Bicknell, C.The petition claims that the evidence did' not sustain the answer. The first paragraph of the answer-sets forth the facts specially, alleging that thereby the defendant “was discharged from all liability on the note.”' Among the facts stated ivas the following: “That the plaintiff then and there did reloan said money to Pattie, Smith & Co. and kept it on loan to them alone from 1872 to 1878.”
The second paragraph alleged payment of the note by Pat-tie, Smith & Co. before suit brought. The third paragraph pleaded a discharge of the defendant by the plaintiff, for a good and valuable consideration.
The evidence is fully stated in the opinion of the court: heretofore given.
We think that the evidence did sustain the answer. When, *423one of the principal debtors and the surety and the creditor met together, and the surety gave notice that he would not stand any longer on the note, etc., the principal debtor then had the money to pay the notes, and proposed to the creditor to pay them, or give a new note of the principal alone. He said : “If you will let our firm have the money on our own note, we will take it, otherwise we will pay you off.”' The creditor replied : “I don’t want the money. I will take Taylor’s name off the notes. I will bring down the notes and fix the matter up, and either get new notes or take the money.” If the notes had been there, and had been can-celled, or Taylor’s name “taken off,” and a new note given of the firm alone, the surety would have been discharged. That would have been equivalent to an actual payment of the money, and a reloan of it to the firm alone ; and, whether the notes were formally cancelled or not, and even if they had remained in the possession of the creditor, the payment of the money and a reloan of it to the firm, on their note alone, would have discharged the surety; and in such a case it would make no difference whether the money was actually handed over to the creditor and then reloaned to the principal debtors, or whether it was permitted to remain in their hands as a new loan to them, in execution of an agreement to that effect; the merely formal act of handing over the money and then returning it would not be indispensable to make such a transaction a payment and a reloan.
The evidence in the case shows that the special transactions between the parties took place in 1871, and that the principal debtors paid interest on the money for several years afterward, and actually paid the money mentioned in one of the notes; the last payment of interest on the note in suit was in July, 1878, and this suit was brought in December, 1878 ; the principal debtors having become insolvent, and the note in suit having been permitted to remain in .the possession of the creditor, he brings suit upon it, claiming that *424the transactions proved amounted to nothing, and that his agreement in the premises amounted to nothing, because it was without consideration; The evidence shows that his agreement was executed, the only inference that can be •made from the facts proved, consistent with honesty and fair -dealing upon the part of the creditor toward the surety, is that the transaction amounted to a payment of the original notes and a reloan of the money to the principal debtors. The original notes having been paid the surety was discharged, whether the notes were left in the creditor’s possession or not, and whether a new note of the firm was taken' or not. It is not necessary to refer again to the authorities cited in the former opinion. We think the facts did sustain the answer.
The petition for a rehearing ought to be overruled.
Per Curiam. — Petition overruled.