RESIDENT MAGISTRATES COURT.

Inangahua Times, Volume XVI, Issue 20227, 22 April 1891, Page 2

RESIDENT MAGISTRATES COURT.

♦ Ellen Mclnroe, aa Executrix of James Mclnro, deceased, plaintiff; ond John McNarnara, defendant. Thfc following judgment has been dalivered by H. E. fenny, Esq., 8.M., in the above cass : — It was agreed by the parties at the hearing tl*&t no question ahould be :i^g<?d'-aff'tp ike validity, of the siguatu tgiU 9 ..;, the, pr p,mis.sqry n 61e,~0r; aF to' ilie' : :appat'eht 'Selects' f^hfefido^fete'* menu, thereof, nod counsel further agreed that the only question for this Court to decide was : Whether the defendant is bound to pay the whole sum due upon the promissory vote for , his proportion of the goods, vie., £85 17s, or £22 8s 9d only, being the amount of the composition the plaintiff made with the holder of the pro* missory note, ami the entire sum she actually paid. The plaintift's statement of claim contains two counts :— one for " goods sold and delivered," and an alternative count based upon the defendant's dishonored promissory note. The facts showplaiuly that tbe goods in question were not sold and delivered to the defendant by the testator, Jas. Mclnroe, but byEobertHannahand Co. The plaintiff is therefore wholly dependant upon her rights upon the promissory note made by the defendant, endorsed by James Mclnroe, dishonored by the defendant, and paid by the Executrix l>y a composition of 12s 6d in the £, upon which payment she was wholly discharged by Hannah and Co. from all liability upon the promissory note Mr Mcluroe's complete discharge is evidenced by Hannah and Oo.'s letter of the 12th January, 1891, to her solicitors, Messrs Jones and Harnan. It would seem that they still hold McNamara liable for the remaining 7s 6d in the £. Now, not only do the facts show, that the relation of " Principal and Surety ' was the one which actually subsisted between the defendant, the testator, and Robert Hannah and Co., but the ja.w has always declared, that the maker of a p. n. is a principle debtor, and u ach indorser, in Ills turn, the surety of the principal debtor. And, it has always bi'fii held, that when a surely (it closet ) has been called on to pay an overdue p. n. he has an action against his principle; nay if he pay by instalment?, be may bring a separate action for each instalment. These propositions of law are known to every businessman, and have never been doubted. But, every Court in New Zealand is now a "Court of Equity" vide sec. 11 " Law Amendment Act 1882 " and Equity holds, that these actions of 'sureties against their principals are actions of indemnity, and that. '• where a surety discharges an obligation at a less sum than its full amount, he can" not as apainst his principal, make himself a creditor for the whole amount, but can only c'aim what he bad actually paid in discharge of the debt." Rend v. Norris, (Mynce and Craig's Chancery Reports, vol. 2, p. 361.375). Snell's Equity p. 490 t (sth cd.) and H. A. Smith's "Principles of Equity" p, 831. 1 iriust therefore decide, iv accordance with this principle, that the plaintiff in this case is only entitled to recover the amount actually paid by her. to the holder of the defendant's dishonored p. n.; i.e. £22 3s9d ; for it goes without saying, that the plaintiff is merely sueing in a representative character, and so can have no better ' rights than, the testator, (the surety in this transaction) could have had had he ibeeii' alive, to make the composition with-f Hannah and Company, &nd to aefek.a .subsequent remedy against the principal debtor, the present defendant.- ■'.:}■■" ./.judgment mußt be entered up for •the plaintiff for £22 8s 9d, with costa as follows :— Witness expenses, Ernest M'lnroe, 265 ; Counsel's -fee £3 35, , £n& the actual Court fees paid by the "plaintiff. ■ ■ • t —