On appeal from the Supreme Court.
For the appellant, Laurence N. Rosenbaum (Louis J. Cohen, of counsel).
For the respondent, Edward R. Deibert.
The opinion of the court was delivered by
RAFFERTY, J. This is an appeal from a judgment of the Supreme Court, Essex Circuit, in favor of respondent, A. Lincoln Taylor, a party defendant below, the case being tried before the court below without a jury and on an agreed state of facts.
Appellant, plaintiff below, was the legal holder of a promissory note, being a renewal time note of an original demand
note, payable to the order of the banking institution which, on January 22d, 1924, had advanced the sum of $10,000 on the original note. This original note was made by Lee G. Taylor, a defendant below, against whom judgment has been entered, and was originally secured only by stock of a corporation in which it appears Lee G. Taylor had some interest.
The note in suit is dated December 31st, 1930, and is in the principal sum of $7,900 and became due on February 27th, 1931.
Sometime after July 22d, 1924, the original demand note was criticized by an examiner of the department of banking and insurance as being without sufficient collateral support. As a result of this criticism and in order to comply therewith the cashier of the bank requested respondent, who was an officer and director of the bank, to guarantee the note, which respondent did. The guarantee reads as follows: "I hereby personally guarantee to the Haddon Heights Bank and Trust Company the payment of note for $10,000 made this day by Lee G. Taylor and any and all renewals or extensions thereof the same as if my personal endorsement appeared on the note." This guarantee, admittedly made and delivered without consideration, was executed sometime after the delivery of the note which it purported to guarantee. It was dated as of the date of the note and was made and delivered to the bank prior to the next renewal of the note.
Respondent, as a member of the executive committee and auditing committee of the banking institution, at various times certified to the bank examiners and to the bank that the assets of the bank included the note in question and the collateral guarantee held therewith.
On January 2d, 1931, the commissioner of banking and insurance took possession of the bank in accordance with the statute in such case made and provided and thereupon did take into custody the records of that institution. Thereafter and until April 2d, 1935, respondent made installment payments on account of the note in the total amount of $2,250, leaving a balance due for ...