
    Jones v. Bangs.
    1. Where a complete note, payable at a future day and containing no stipulation' as to interest, is altered by the principal maker without the knowledge of his surety, before its delivery, by the addition of the words “with ten percent, interest from date,” Held: That such alteration is material and makes the note void as against the surety, although the same is made without the knowledge of the payee.
    2 Where the charge of the court to the jury was manifestly erroneous as to a material issue raised by the defense, and the record does not disclose all the evidence, the judgment should be reversed, although it does not appear that the defendant was prejudiced thereby.
    Error to District Court of Ross County.
    Hannah A. Bangs, the defendant in error, brought suit as payee and holder of two promissory notes against William Jones, the plaintiff in error, and A. W. Thompson, two of the makers thereof to recover the amount due thereon.
    A copy of one of the notes is set out in the opinion of the court. The other note is for same amount, to same payee, by same makers, payable ten months after date and dated February 1st, 1873, and contains this clause: “ at ten per cent, interest per annum.”
    
    
      It was admitted that Jones signed both notes as surety for C. B. Thompson. The trial was to a jury who rendered a verdict for the amount due on the notes. The only issue tried was raised by one branch of the answer and a reply thereto by way of denial. That answer was this :
    2. That said notes were altered, after he had signed his name to them, so far in their tenor and effect, and without his consent, as to the first note, by writing therein the words, “ at ten per cent, interest per annum,” and in the second note “ with ten per cent, interest from date.”
    
    Testimony was given on both sides relative to that issue. A motion for new trial, predicated on the refusal of the court to charge as requested, and an alleged error in the charge given, was overruled, and a bill of exceptions taken. Thereupon a finding on default was taken against A. W. Thompson and judgment against both defendants.
    The bill of exceptions amongst other things recites:— And, be it further remembered, that at said trial, at said term of court, evidence had been given tending to show that the notes sued upon had been fraudulently altered after being signed by said Jones, either with or without the consent and connivance of said plaintiff, as alleged in said first defense, and, on the other hand, evidence had been given tending to show that such was not the case, and the evidence being all in, the said defendant, by his counsel, asked the court to charge the jury: “That, if the jury should find that the note, or notes sued upon, had been changed or altered as alleged in the first defense of the amended answer, after they had been signed by said Jones, and without his knowledge or consent, then the contract upon which he is sued is not the contract which he signed, and the plaintiff cannot recover.” Which said charge the court refused to give, but did charge the jury as follows, in respect to said first defense:
    “ Each note constitutes a separate cause of action, and to each the same defenses are pleaded. As to the first defense to each note, the burden is upon the defendant to maintain this defense by a fair preponderance of the evidence, and in order to make out this defense the proof must satisfy you of two things:
    1. “That the note, in each case,, was altered by the insertion of the clause'as to interest, after it had been signed by the defendant Jones, and without his consent.
    2. “ That it was so altered with the knowledge, consent, or procurement of the plaintiff. For if the note (either of them) was altered before its delivery to the plaintiff without her knowledge or consent, such alteration will not affect its validity in her hands.”
    On error to the district court assigning the said refusal to charge and the charge as given for error, the judgment was affirmed. To reverse the judgment of affirmance this proceeding was instituted.
    
      William V. Lawrence and Albert Douglas, Jr., for plaintiff in error.
    As to alteration. 1. As to the paper itself, see Wait v. Fomroy, 20 Mich., 425; Somes v. Trumper, 22 Mich., 427; Waterman v. Vose, 43 Me., 504; Draper v. Wood, 112 Mass., 315; 2 Ellis & Blackburn, 763; 108 Mass., 366.
    2. As to parties. The proposition we make in this case is this: The unauthorized alteration of a promissory note, by writing therein an interest clause, after it has been signed by a surety, while in the hands of the maker, and without the procurement or assent of the payee, renders the same void in the hands of the payee as against such surety. ¿Etna National Bank v. Winchester, 43 Conn., 391; Trigg v. Taylor, 27 Mo., 245; Schuewinde v. Sateher, 54 Ind., 248; 1 Allen, 477; Fuller v. Seitz, 68 Penn. St.', 237; Wood v. Steele, 6 Wallace, 30; Miller v. Stewart, 8 Wheaton, 68; 4 Denford & East, 320.
    After commenting on Fullerton v. Sturges, 4 Ohio St., 529, counsel, to show the current of decisions since that case, in addition to above authorities cited Masters v. Miller, 4 Den. & East, 320; 1 Smith’s Leading Cases, 934, et seq.; Leake on Contr., 425; Chitty on Bills (9th Am. Ed., 203, Dovsian v. Cooper, 13 M. & W., 343 and 352; Mallin v. 
      Wackinbrath, 3 E. & B., 683); 23. Me., 329; 13 Pick, 165; 13 Mass., 26; Greenfield Bank v. Stowell, 123 Mass.,.203.; Warrall v. Greene, 39 Pa. St., 388; Coburn v. Webb, 56 Ind., 100; Miller v. Finley, 26 Mich., 249; Ivory v. Michcel, 33 Mo., 400; Brittain v. Dieken, 46 lb., 591; 2 Am. Rep., 553; Bruce v. Westcall, 3 Barb., 374; Benedict v. Gowden, 49 N. Y., 396; McGrath v. Clark, 56 lb., 34; Godman v. ' Eastman, 4 N. H., 455; Genish v. Glines, 56 lb., 9; More-head v. Parks H. Bk., 5 W. V., 74; 13 Am., 636; Owings v. Amat, 33 Miss., 406.
    
      Harrison, Olds Marsh and Van Meter Throckmorton, for defendant in error.
    I. The first alleged defense does not state.facts.sufficient to constitute a bar to either of the rights of action set forth in the original petition. The new matter therein, set up, does not avoid either of the notes upon which such rights of action are founded. It does not indicate, in any manner, by whom the alleged alteration of each note was made. It does not allege that either was done with the knowledge, or by the authority or direction, of the plaintiff below; nor does it-even allege that either was made without the knowledge of -the defendant, Jones. It does not allege whether the alterations were made before or after the notes respectively were negotiated and delivered. Neither does it contain any allegation inconsistent with the fact or conclusion that the alleged alterations were made by a stranger; and, if so, the alleged alterations would not have affected the validity of the notes. It follows that if a demurrer had been interposed to said defense on the ground that it is bad in substance, judgment must have been rendered-sustaining such demurrer. Fullerton v. Sturges, 4 Ohio St., 530; United States v. Linn, 1 Howard (U. S.), 104; Humphries v. Crane, 5 Cal., 173. The material alteration of a written instrument made by a stranger will not avoid it. To have that effect the alteration must be made by or with the privity of one claiming a benefit under the instrument, and (to give application to the doctrines upon that subject) after the instrument has been delivered and taken effect. Fullerton v. Sturges (supra) ; United States v. Spalding, 2 Mason, 478.
    II. A judgment will not be reversed because an erroneous instruction was given to the jury, unless the record 'discloses some evidence tending to show that the instruction was material. Louderhack v. Qollins, 4 Ohio St., 251. Erroneous instructions to the jury which the record shows could not have prejudiced the party is no ground for reversal. Orieleett v. The State, 18 Ohio St., 9. We have endeavored to show that the first defense did not set forth facts sufficient to bar a recovery by the plaintiff below; so that upon the'petition, the first defense, and the reply thereto, she was entitled to judgment. It follows, we submit, that the record shows that the plaintiff in error could not have been prejudiced by the instructions of the court to the jury as to the first defense.
    
      Again, every statement in the record may be true, and yet the alleged alterations may have been made by a stranger. So that even if the court erred, as opposing counsel claim, in charging that if either of the notes were altered before its delivery to the plaintiff below, without her knowledge or consent, such alteration would not affect its validity; and hence, such error would be no ground for reversing the judgment. The plaintiff in error was not prejudiced by such instruction; for without proof that the alleged alterations were not made by a stranger, they did not render the notes void as to him. . .
    Finally, on this point the first proposition in the charge as to the burden of proof is sustained by the case of United States v. Linn (supra), and many other authorities. The rule is, that where the defendant alleges an alteration of a note after he signed it, if the alteration be not apparent on the face of the instrument, the burden is on him. Davis v. Jenney, 1 Met. (Mass.), 221; Meikel v. State Savings Insti tution, 36 Ind., 355; King v. Bush, 36 111., 142; Bank v. Irwin, 31 Ga., 371; Jones v. Ireland, 4 Iowa, 63.
   Martin, J.

The makers and payee of each note are the same. For convenience we will consider the note which reads:

“11,000. Chillicothe, 0., February 18th, 1878.
One year after date we, or either of us, promise to pay to the order of Mrs. J. J. Bangs one thousand dollars, for value received — with ten per cent, interest from date — ■
C. B. Thompson,
Vm. A. Jones,
J. P. Steeeev,
A. W. Thompson.5’

The answer of the suret}*- Jones merely alleges that after he signed the note it was altered, without his consent, by the addition of the words “ with ten per cent, interest from date.” By whom and when, whether before or after delivery, or with or without the knowledge of the principal or payee, is not stated. The plaintiff making no objection to the answer on account of this indefiniteness, put in a reply amounting to a general denial. On this issue alone the case went to a jury and testimony was given tending to show an alteration as charged in the answer. The defendant requested an instruction to the jury to the effect that if they found that the note had been altered as stated in the answer, then the note sued on was not the note he signed and the plaintiff cannot recover. This instruction the court properly refused to give. The charge given ivas “ that if the note was altered before delivery to the payee without her knowledge or consent, such alteration will not affect its validity in her hands.”

The only questions to be decided arise upon this charge. As applied to the note under consideration, the charge is to the effect that a material alteration of a complete note, made by the principal maker, before delivery and without the knowledge of the surety, does not discharge the surety, unless such alteration was made with the knowledge, consent or procurement of the payee. We think this charge is manifestly erroneous. We are sustained in this view by numerous well considered adjudications: in New York, McGrath v. Clark, 56 N. Y., 34; Connecticut, Ætna National Bank v. Winchester, 43 Conn., 391; Massachusetts, Draper v. Wood, 112 Mass., 315 ; Pennsylvania, Fulmer v. Seitz, 58 Pa. St., 237; Maine, Waterman v. Vose, 43 Me., 504; Michigan, Bradley v. Mann, 37 Mich., 1; Indiana, Schueiwinde v. Hacket, 54 Ind., 248; Missouri, Frigg v. Taylor, 27 Mo., 245.

Many other authorities bearing directly on the point, from the same and other states, are cited in the able -brief of counsel for plaintiff in error. The alteration was certainly material. When it was signed by the surety the note bore no interest before maturity, and was for the payment of $1,000 and no more when due. As altered it drew interest from date and was for the payment of $1,060 at maturity'. It may be well to remark (although it is not an important circumstance,) that the note is joint and several. The principal was not a party to the action; and the plaintiff planted her case on the several promise of the surety. If the surety is bound, it is because of his promise. There is no intimation in the record that his alleged liability was assumed otherwise than by his written promise. When he signed and handed the note to his principal, he thereby authorized its delivery as it was then written. And he would have been bound accordingly to the - payee or any subsequent bond fide holder.

By the subsequent alteration its identity' was lost, and there arose another and distinct obligation' which he had not signed. To hold him bound by the new contract he must, in some way consistently with legal principles, be concluded by the act of his principal or other person in making the alteration. lie may' be thus concluded by authority previously' given, or by subsequent ratification, or by conduct on his part raising an estoppel. There is no claim made of subsequent ratification. And there is no suggestion of authority other than the mere fact that he entrusted the paper to his principal for negotiation. The principal had the custody' of the note with authority to deliver it. If the surety had parted with' the note, leaving a blank for the insertion of the amount or other material part, the custody of the note would have carried with it unrestricted authority to fill the blank accordingly. Fullerton v. Sturges, 4 Ohio St., 599. In this instance there was no blank to be filled. The surety carefully fixed in writing all the terms of his contract — the day of payment and the precise amount he was to pay. The note was complete when it left his hands, and conferred no authority on anybody to alter it.

Did the conduct of surety estop him from saying that the alteration was without his consent? The record of his conduct is brief. He signed the note at the request of his principal, and handed it to him for delivery to the payee. This is all of it. It was a single transaction incapable of being misunderstood.

It is claimed by learned counsel for the defendant in error that the surety here falls within the rule, “ Whenever one of two innocent parties must suffer by the act of a third, he who has enabled such person to occasion .the loss must sustain it.”

The application of this rule to the unauthorized alteration of a complete note by one of the promissors, before delivery, and without the knowledge of the other, is expressly denied in McGrath v. Clark and Ætna Natl. Bank v. Winchester, supra.

The construction of an instrument may, it is true, be so faulty as to afford exceptional facilities for alteration. And in such case negligence to some extent may be imputed to the maker. He may possibly be said to have enabled his co-maker to commit the forgery. Every such case must stand on- its own peculiar circ'umstances. In this record, however, we see no evidence of negligence on the part of the surety.

The alteration consisted of words added at the end of the note. In what respect was the surety negligent in not anticipating and preventing this crime ? He might, it is true, have drawn an elongated scroll from the end of the note before parting with it. If this was his duty, it was likewise his duty to have excluded the possibility of fraudulent alteration on any part of the space within the four corners. A construction of the rule which exacts such suspicious care, and requires the surety to regard his principal as a rogue, is untenable and wholly unsuited to the practical business methods of our people.

The case of Fullerton v. Sturges, supra, is confidently relied on by the defendant in error, as sustaining the position that the participation of the payee in a material alteration, before deliveiy, is necessary to avoid the note as to a surety who had no knowledge of, and had given no authority to make, the alteration. As we understand that case, the alteration consisted in affixing a seal to • the name of the surety before delivery and was wholly immaterial. Therefore, all that was said by the eminent judge who delivered the opinion on the law relating to a material alteration, is obiter.

It is insisted, however, on behalf of the defendant, that the error in the charge is immaterial because of the deficiencies of the answer.

To this we cannot accede. The answer set up a partial defense at least, and the intent was to state a full defense. The plaintiff claimed to have established by the testimony that the alteration was made under circumstances that would in law discharge the surety. The charge assumed that the testimony tended to show the alteration was made before delivery. Had there been a general or special verdict warranted by the testimony in favor of the defendant, it would have been the duty of the court to save the rights of the defendant by ordering an amendment of the pleading if necessary. The mere fact that the record does not affirmatively show that the defendant was prejudiced by the error in the charge is not important. It is sufficient that he may have been prejudiced. The testimony is not before us. Baldwin case, 1 Ohio St., 141; Railroad Company v. Stallman, 22 Ohio St., 1.

We consider it unnecessary, in view of what has been said, to comment on the other note described in the record.

Judgment of the district court reversed.  