Opinion
No. 34406.
February 10, 1941. Suggestion of Error Overruled, March 10, 1941.
1. BILLS AND NOTES.
Accommodated maker and accommodation makers were absolutely bound to pay note, but, as among themselves, the primary obligation rested on accommodated maker who upon payment of note by one of the accommodation makers became obligated to reimburse him therefor.
2. LIMITATION OF ACTIONS.
In order for an "implied promise" to be without codal section covering actions on any unwritten contract, express or implied, and providing that actions thereon shall be commenced within three years next after the cause of action accrued, the implied promise must be to perform a contract, the terms of which are written (Code 1930, sec. 2299).
3. LIMITATION OF ACTIONS.
Where action by accommodation maker was based on implied promise of reimbursement by accommodated maker and not on the note which accommodation maker had paid, the action was on an "implied unwritten contract" within three-year Statute of Limitations, particularly since payments made were not provable by any writing but rested in parol (Code 1930, sec. 2299).
APPEAL from the circuit court of Newton county, HON. PERCY M. LEE, Judge.
Spinks McCully, of DeKalb, for appellant.
The obligation on which the suit is predicated is in writing. The obligation of the appellee on which suit is not brought is the note. While we do not sue as assignee of the note, still the case made by the declaration is predicated on the note.
Aven v. Singleton, 96 So. 165, 132 Miss. 256; Tucker Printing Co. v. Bd. of Sup'rs, 171 Miss. 608, 158 So. 336; Price v. Harley, 142 Miss. 584, 107 So. 673; W.T. Rawleigh Co. v. Fortenberry et al., 138 Miss. 410, 103 So. 227; Vicksburg Water Works Co. v. R.R., 59 So. 825, 102 Miss. 504.
The three-year statute applies to (1) open accounts; and (2) to unwritten contracts, express or implied.
Sec. 2299, Code of 1930.
The contract is in writing and the six-year statute of limitations, Section 2292, Code of 1930, applies.
Byrd Byrd, of Newton, for appellee.
The right of action, if any the appellant had, was on the implied contract existing between Prince and his endorsers that in the event they were called upon to pay his indebtedness he would reimburse them. There is nothing in the note to this effect, and in order for the appellant to recover he must rely on the implied contract, otherwise he would not be entitled to recover at all unless the suit is a suit on the note in question. The party accommodated by an accommodation endorsement, such as the appellant's endorsement is alleged to have been in the instant case, impliedly agrees to take up the note at maturity and to indemnify the accommodation maker or endorser against the consequences of nonpayment.
3 R.C.L. 1120.
The implied contract is not evidenced by writings, and oral proof will be required to establish the fact that the appellant and W.I. Luke were merely endorsers. Unless the entire contract can be established by written evidence it is not such a written contract as would take the action out from under the bar of the three-year statute. If any material part of the contract rests in parol, then the three-year statute applies.
City of Hattiesburg v. Cobb Bros. Const. Co., 174 Miss. 20.
In the instant case there is nothing to take this case out of the operation of the rule that the contract must be provable entirely by writing.
Argued orally by L.P. Spinks, for appellant.
This action was begun by the appellant against the appellee on a declaration alleging that, in February, 1931, the appellant and W.I. Luke, at the request of the appellee and for his accommodation, joined him in executing a promissory note to Henderson-Molpus Company for $7,500 to cover an indebtedness due it by him. This note was assigned by the payee to J.W. McArthur, and on January 19, 1933, was renewed by a new note to McArthur for $5,000, signed by the appellee, the appellant, and Luke, due January 19, 1934. On January 24, 1933, the appellant made a payment on this note, and on October 9, 1934, he paid the balance due thereon. The recovery sought is for the aggregate of these two amounts, with interest thereon.
To this declaration the appellee filed two pleas: One setting up the three-year limitation on the right to bring an action provided by section 2299, Code 1930; and one setting up the six-year period of limitation therefor set forth in section 2292, Code 1930. Demurrers to each of these pleas were overruled; and the appellant declining to plead further, judgment was rendered for the appellee.
The question presented by each of these demurrers is whether the limitation provided by the statute invoked in the plea demurred to applies to the cause of action set forth in the declaration. If section 2299 applies, the court below committed no error in overruling the demurrer to the plea invoking that section, and it then became the duty of the appellant to reply to the plea. On his declining to do this, the appellee was entitled to a judgment, and it will, therefore, not be necessary to consider the plea setting up the limitation provided by section 2292.
Section 2299, Code of 1930, provides that "actions . . . on any unwritten contract, express or implied, shall be commenced within three years next after the cause of such action accrued, and not after."
This note, when paid by the appellant, was assigned to him, and it is made an exhibit to his declaration; but the appellant's action is not based, by his declaration, on the note, but on a claimed implied promise by the appellee to reimburse the appellant for the payments made by him on the note.
Each of the three makers of this note were absolutely bound to pay it; but, as among themselves, the primary obligation so to do rested on the appellee for whose accommodation the other two signed it. When the appellant made the payments on the note set forth in the declaration, the appellee became obligated to reimburse him therefor. Restatement Restitution and Quasi-Contracts, Secs. 76 and 77.
This is admitted by the appellee, but he says that this obligation does not arise on a written contract, but on a promise implied by law to so reimburse the appellant; to which the appellant replies that the promise implied is to perform a written contract — a contract provable by the note, a written instrument; and therefore the cause of action is not within section 2299. The note in this connection proves only that the appellant was bound to pay it. What his rights are against the appellee on paying it was not set out therein, but rest on what effect the law gives to this payment. In order for an implied promise to be without section 2299, it must be "to perform a contract, the terms of which are written." Washington v. Soria, 73 Miss. 665, 19 So. 485, 487, 55 Am. St. Rep. 555. In that case a grantor conveyed land by a deed poll for a recited consideration, payable in named installments, which the grantee failed to make. When sued therefor, the court held that the section of the then Code that is now section 2299, Code of 1930, had no application, for the implied promise sued on was to do what the deed set forth — that is, pay the named instalments of the purchase money on their due dates. That case has been followed by this court in subsequent cases.
Moreover, the payments made by the appellant, because of which the implied promise arises, are not provable by any writing, but rest in parol. City of Hattiesburg v. Cobb Bros. Const. Co., 174 Miss. 20, 163 So. 676.
Affirmed.