Yazoo County MsArchives Court.....Pease, W.J. 1839
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Source: Reports Of Cases Argued And Determined In The High Court Of Errors And Appeals Of The State Of Mississippi
Written: 1839

Pease v. Turner.

pages 375-376

The endorsee of a promissory note is entitled to file the name as an offset in 
a suit against him by the payee and prior endorser to recover money due by the 
defendant on another claim.

An endorsement is in the nature of a new and distinct contract, and is an 
engagement to pay, to whoever may by subsequent negotiations become the holder 
of the bill or note, the amount secured by it; it may, therefore, be given in 
evidence on a count for money had and received.

The act of 1837, which only changed the rule of pleading, does not affect the 
right of the endorsee of a promissory note to give it in offset to a suit by 
the endorser.

ERROR to the circuit court of Yazoo county.

Fitch, for the plaintiff in error, cited Rev. Code, 119, sect. 63; Ibid. 464, 
sect. 9; 13 Johns. Rep. 20; 2 Ibid. 155; 12 Ibid. 93, 344; 8 Ibid. 153; 17 
Ibid, 350; 1 Bay’s Rep. 437; 2 Ibid. 351.

Thompson and Grayson, contra.

Mr. Justice TROTTER delivered the opinion of the court.

This was an action of assumpsit, by the defendant in error, against the 
plaintiff in error, to recover the amount due upon a bill of exchange, of 
which the defendant was possessed as holder. The defendant below pleaded non 
assumpsit and payment, and filed with the second plea, a bill of particulars, 
in which he claimed to be the holder of a promissory note made by Hardy Weems, 
for the sum of 3237 dollars and 13 cents, payable to the order of Edward 
Turner, and by him endorsed to W. J. Pease & Co., who endorsed it to the 
defendant below, with an averment of protest and regular notice. On the trial, 
the defendant below produced and offered to give in evidence to the jury, this 
note and the endorsement as an offset. But the court refused to suffer it to 
be read. And this decision of the court is assigned as the ground of error. It 
is too well settled to be controverted, that the holder of a bill or 
promissory note is entitled to an action against all the parties to the same, 
and the endorsee may maintain the action against his immediate endorser, or a 
prior or remote endorser at his election. An endorsement is in the nature of a 
new and distinct contract, and is an engagement to pay to whoever may, by 
subsequent negotiation, become the holder of the bill or note, the amount 
secured by it. It is an appropriation of so much money for the use of the 
holder. It may, therefore, be given in evidence, on a count for money had and 
received. The contract of an endorser is, therefore, no longer considered as a 
collateral undertaking merely. He is not regarded in the light of a surety, 
but his liability is based upon his distinct and independent contract. 16 
Johns. Rep. 151. It is conditional to be sure, but upon the performance of the 
condition, it is rendered absolute. It is a contract to pay the amount of the 
bill or note upon demand made, and refusal of the maker, and due notice. It is 
then a specific contract, as much so as that of the maker, and if the holder 
may maintain indebitatus assumpsit, or debt against the maker, it follows 
necessarily that the same action will lie against the endorser. 2 Wheaton, 
385; 6 Peters’ Rep. 20.	But it is said there is no privity of contract between 
the holder and a remote endorser. There is no privity by express contract, but 
there is a privity in law. 1 Mason’s Rep. 318. Nor indeed is it necessary in 
all cases that there should be a privity of contract. It is sufficient if the 
law will create the liability to pay. Indebitatus assumpsit lies against the 
finder of money. Here is not the semblance of privity, and yet the law holds 
the finder a trustee for the owner, and bound in conscience and good faith to 
pay the money. So in this case, the contract of the defendant in error, raises 
in law, a promise to pay the amount of the note to any bona fide holder. Debt 
or assumpsit, therefore, clearly lies, and if so, it was a subsisting claim 
which might properly have been set off against the claim of the plaintiff in 
the court below. The act of 1837, cannot properly exercise any control over 
this right. That act only changed the rule of pleading. It has not varied the 
rights of the parties. The judgment must be reversed, and a venire de novo 
awarded.


Source: Reports of Cases Argued and Determined in the High Court of Errors and 
Appeals of the State of Mississippi, by Volney E. Howard, Reporter to the 
State; Vol. III; Containing the Cases for December Term, 1838, and January 
Term, 1839. NEW ORLEANS: E. JOHNS & CO., STATIONERS’ HALL, 1839.

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