gage, becomes the principal debtor for the payment of the mortgage, and that the grantor of the premises becomes the surety with all the rights of a surety. In the case of Moore vs. Topliff," notes were given by a partnership firm composed of A, B and C and indorsed to third parties, which notes were secured by a mortgage to the creditors, from C, on the real estate. A afterward sold out all his interest in the firm to B and C, who assumed all the firm indebtedness, and formed a new partnership, the new firm paying interest on the notes until their bankruptcy, in which proceedings in bankruptcy the creditors proved their debts, and received forty-two per cent as a composition, in full discharge of the personal liability of B and C. Held, that as A was still personally liable on the notes as surety for B and C the mortgage was not extinguished, and that A's existing equity, as surety, to have the mortgage security surrendered by the creditors to him upon his payment of the balance of the debt, was unaffected by the bankruptcy discharge.

The obligation of the surety will not be implied, yet the law itself will extend the privileges and rights of a surety, to one who is bound to answer for the default of others who by their agreement, contracted to meet the indebtedness and relieve the person who subsequently has to pay the debt, which the other person's default has put back on his shoulders."

SECTION 9. PLEDGING OR MORTGAGING PROPERTY TO SECURE DEBT OF ANOTHER.

Property itself may be said to occupy the position of a surety, where it is pledged by the one owning the

13 107 II., 241.

“Ayers vs. Dixon, 78 N. Y., 318;

Smith vs. Sheldon, 35 Mich.,

42.

same, as security for the default of another person." Where one member of a partnership pledges his own property for the payment of the firm debts, here the property is in the situation of a surety, and as against those who claim an interest in the property, the creditor must observe the rights of the surety."

SECTION 10. PARTNERS ASSUMING PARTNERSHIP DEBT.

In the case where certain members of a partnership firm assume the partnership debts and continue the business on the retirement of one of the members, this does not release the retiring member from the debts already contracted, unless the creditors so agree. But it gives the retiring member the right to claim the rights and privileges of the surety, as against the firm members who are continuing the business and who assume the firm debts.17

SECTION 11. JOINT CONTRACTS.

It is the general rule that if one is jointly liable for the payment of a debt with the principal, the contract is not within the statute of frauds. Holding that if the promise is joint, that the promise is original as to both promissors.18 But it is oftentimes a question of fact as to whether the promise was, or was not, a joint promise. Where several parties sign a joint note as makers, and it is known to the creditor that some of them or one of them is a surety, the surety showing this fact, may either in a court of law, or in a court of equity, claim the rights and privileges of the surety.19 The true contract in such a case

" Allen vs. O'Donnell, 28 Fed. Rep., 346.

16 Lowry vs. McKinnie, 68 Pa. St., 294.

" Colgrave vs. Tallman, 67 N. Y.,

95; Smith vs. Sheldon, 35 Mich., 95.

18 Ex parte Lowe, 1 De Gex, 300; Brown on Statute of Frauds. 19 Kennedy vs. Evans, 31 Ill., 258.

may be shown. It is also the general rule that one of the makers of a joint note under seal may show at law, and by parol, that he is a surety, and these decisions are founded on the same reasons that are given in the case of a note not under seal.20 Joint parties to a note each have all the rights of a surety, so far as the payment of the shares of the others are concerned, and an act by the creditor discharging one, would thereby discharge the other."1

"Rodgers vs. School Trustees, 46 " Clark vs. Dane, 128 Ala., 122. Ill., 428.

CHAPTER II.

PARTIES TO THE CONTRACT.

SECTION 12. WHO MAY BECOME A SURETY OR A GUARANTOR.

In general, it may be stated that anyone who has legal capacity to enter into a contract, may bind himself on his contract to answer for the debt, or default of another, and in general it may be said the party may be considered incompetent to bind himself as a surety, where his ordinary contracts would be either void or voidable. The promissor in suretyship must not be of unsound mind, or be under the lawful age to contract, and at common law the fact that the promissor was a feme covert, that is a married woman, would disqualify her from making a binding contract of suretyship, so also the usual rule of partial disability of the partnership, and the corporation to contract generally, would prevail in the matter of their ability to answer for the debt, or default of another. In addition to the common law disability there exists in certain states, the statutory rule that certain other persons, such as attorneys-at-law shall not be proper sureties where the debtor is the surety's client, in the matter of the attorney signing a bond for instance, but these rules are made rather for the purpose of justifying the public officer in the rejection of such a surety, rather than to make the contract of such a surety invalid once it has been entered into, and once such a surety has been accepted as such, he is usually bound on his contract notwithstanding the law's prohibition