
    The Mechanics & Traders’ Bank, Resp’t., v. Frederick Livingston et al, App’lts.
    
      (City Court of New York, General Term,
    
    
      Filed June 19, 1893.)
    
    Bills and notes—Accommodation paper—Pledge—Evidence.
    In an action upon a note which was pledged with others by the payee as collateral for a loan, where it is admitted that the amount of such loan has been collected from the other collateral, it is error to refuse to allow defendants to show that they were accommodation makers, as a pledgee has no cause of action against the accommodation maker if the debt for which accommodation paper was pledged has been paid in full.
    Appeal by defendants from judgment against them, entered on a verdict directed for the bank, and from the order denying motion for new trial.
    
      Charles Strauss, for resp’t; Geo. F. Martens, for app’lts.
   Van Wyck, J.

The action is by the bank on a promissory note made by defendants to the order of Haas & Pohalski, and by them indorsed and delivered to the bank. The alleged defense of defendants, the makers, is that the note was given to Haas & Pohalski for their accommodation and without consideration, and that Haas & Pohalski delivered this note, together with twenty-six other promissory notes, aggregating with this one $6,024.77, to the bank as collateral security for the páyment of a note for $3,000- made by them to order of, and delivered to the bank at the same time for full Value, and that this $3,000 note has been fully paid by collection by the bank of over $3,000 on the other twenty-six notes, given as security as aforesaid. The record shows that the uncontradicted testimony of defendants’ witness Byttenberg is that “ At the time the bank made the loan of $3,000 there was a list of notes which were given as collateral for this loan. I took the notes contained in this list along with me, with the $3,000 demand notes, to the bank. I gave $3,000 as a demand note to the bank, subject to the bank’s order.

The other notes mentioned in the list, there were about twenty-six of them, were not discounted, and were given as collateral security for the $3,000 loan,-made by the bank to Haas & Pohalski on the demand note.” As this witness was proving payment of the other twenty-six collateral notes, the plaintiff admitted as follows: “Plaintiff admits that about $3,000 of those collateral notes have been paid,” and thereupon the list of these twenty-seven notes, including the one in suit, was marked in evidence. Defendant’s exhibit 1. This uncontradicted proof made out a complete defense under the law of this state, provided that the defendants were accommodation makers of the note sued upon. Continental Bank v. Bell, 125 N. Y., 38; 34 St. Rep., 481, in which Judge Andrews writing says : “Assuming that there was no wrongful diversion of the note by Crosby, nevertheless, the bank cannot enforce it against the accommodation maker for any amount beyond that for which it was pledged, nor for a debt for which it was not pledged.” If the debt for which accommodation paper was pledged has been paid in full, the pledgee has no cause of action against the accommodation maker thereof. Upon the trial o£ this cause the defendants were denied the privilege of proving that they were accommodation makers of the note sued upon, and the record shows that they made proper effort to do so, and duly excepted. liad they made such proof, then the verdict should have been directed for the defendants. Hence the direction of a verdict in favor of the plaintiff was error, and the judgment and order appealed from must be reversed, with costs to appellant to abide the event, and new trial ordered. McGown and Fitzsimons, JJ., concur.  