
    ACTION AGAINST THE GUARANTOR. OF A NOTE.
    Common Pleas Court of Montgomery County.
    A. H. Walker v. J. E. Wolf and C. J. Bueker.
    Decided, December 22, 1916.
    
      Promissory Notes — Liability of a General Guarantor — Not Dependent Upon the Insolvency of the Maher — Contract of Guarantor Distinct from that of Maher, When — Misjoinder.
    1. The liability of one who enters into a general guaranty for payment of a promissory note is absolute and is In no way affected by the question of the solvency of the maker.
    2. Where an endorsement of guaranty is made subsequent to the making of the note and by one who is not at the time an indorsing holder thereof, his liability as guarantor is under a contract separate and distinct from that of the maker of the note and he can not be joined in the action against the maker.
    
      Jones & Kemper and John Edwards, for plaintiff.
    
      Powell & Howell, contra.
   Snediker, J.

This case is before the court on a general demurrer to the petition: The allegations of the petition are that the defendants, J. E. Wolf and C. J. Bueker, are indebted to the plaintiff in the sum of $500 with interest on a promissory note, a copy of which is incorporated in the body of the petition. The liability of Wolf arises from his relation to the plaintiff as maker of the note. The liability of Bneker arises from an endorsement on the note in these terms:

“Por value received, we jointly and severally guarantee payment of within note and interest and waive demand and protest and notice of non-payment and protest.
“C. J. Bueker.”

The point made by counsel for defendant Bueker on the demurrer is that it is the duty of the plaintiff to first exhaust his remedy against the maker Wolf before he looks to the guarantor Bueker, on the theory that unless the maker fails to pay the note when it is dne and is then entirely insolvent and bankrupt, the guarantor does not become liable.

The copy of the note with its endorsements as found in the petition indicates that Bueker is not an endorser, but on the contrary has simply entered into a general guaranty for payment. The case of Stone v. Rockefeller, 29 O. S., 625, referred to by counsel for Bueker, is not one of general guaranty for payment, but is a guaranty of collectibility, and as between such a guaranty and one for general payment there is a wide distinction. The force and effect of a general guaranty is stated by Daniel in the second volume of his work on Negotiable Instruments, at Section 1769:

‘! If A guarantees expressly or by implication to pay the note of B to C provided B does not pay it, he becomes absolutely liable for its payment immediately upon B’s default and is therefore deemed an absolute guarantor of the due payment of the note by .B to C. ”

His liability being absolute, no question as to whether or not the maker is insolvent or bankrupt is recognized as affecting such liability. The allegations of this petition are that the note is due from Wolf and unpaid. In view thereof, the liability of Bueker has arisen and an action is maintainable against him.

But another very grave question has presented itself to us with regard to the form of the petition. Are or are not separate causes of action against several defendants improperly joined? It is a general rule that a pleading must be taken most strongly against the pleader. There is nothing said in this petition as to the time when Bueker indorsed on the back of the note his guaranty. Our Supreme Court in the case of Bright v. Carpenter and Schurer, 9 Ohio Reports, 139, hold that:

“When a stranger to a promissory note indorses it in blank at the time of making it, the payee of the note may sue him with the maker as a joint maker of the note. But if a person not a party gives his name to a note already existing, his engagement is collateral only and he is held as guarantor.”

In the 16 Ohio, at page 1, our Supreme Court held that:

“The guaranty of- the fulfillment of the contract written below the contract and executed at the same time subjects the guarantor as an original contractor and a suit may be entertained against both parties jointly or against either severally.”

And, in the case of Gale’s Administratrix v. Van Arman and Hopkins, 18 Ohio Reports, page 336, the Supreme Court in the syllabus say:

“Where a stranger to a note payable in clocks at the time of the execution wrote upon the back and signed these words, ‘I guarantee the fulfillment of the within contract,’ held: that the instrument with its indorsement was a joint contract and that the parties might be sued jointly upon it.”

This defendant, Bueker, is not in the position of Clay in the case of Isaac Clay and John Hoot v. Chester Edgerton, in the 19 O. S., page 549; nor is he in the position of Lewis & Brothers in the case of Peter Kautzman et al v. Jesse Weirick et al, 26 O. S., 330. Clay and Lewis & Brothers, in these several cases, were indorsers who at the time of the indorsement and transfer of the instruments involved made the guaranty upon which the Supreme Court held they were liable jointly with the maker because of the fact that they were such indorsers and transferers of the note as well as guarantors.

If Bueker, after the making of the note of October 1, 1915, made his indorsement of guaranty, his indorsement not being that of an owner and holder transferring the note, his liability as such guarantor is under a contract separate and distinct from the contract made by Wolf as maker of the note. In that event, there are in this petition separate causes of action against several defendants improperly joined. 8 N. Y. Rep., 207; 10 Barber, page 638.

In Pomeroy’s Remedies and Remedial Rights, at Section 409, the author says:

“It has been decided in many cases and undoubtedly the weight of authority sustains this ruling, that a guarantor and the principal debtor can not be sued together in one action, even though the guaranty be written upon the same paper with the agreement which it undertakes to secure. It is said that the principal debt and the collateral undertaking do not constitute one instrument and the parties, therefore, do not come within the language of the statute.”

The authorities here collected are sufficient to indicate that a guarantor is jointly liable with the maker only when he executes such guaranty at a time when as indorser he is transferring the note to another, or at the date of the making of the note; and that if the guaranty is executed under different conditions it becomes a separate contract, and a separate cause of action exists against the guarantor from that arising by virtue of the note against the maker, and the guarantor’s liability is neither joint nor joint and several with that of the maker.

Without an averment in this petition to the effect that at the time of the making of the note by Wolf to Walker the note was indorsed with the guaranty of Bueker, our opinion is that no action may be brought against Wolf and Bueker jointly. If the plaintiff can not make such an averment, he is entitled to proceed against either Wolf or Bueker separately; in the one case for the collection of his note, in the other for a realization on the liability of the guarantor.

While the demurrer is general, yet for the purposes of the case we believe it should be taken as one, on the ground that separate causes of action against several defendants are improperly joined, and, so taken, should be sustained.  