On appeal from Superior Court of New Jersey, Law Division, Essex County.
O'Brien and Skillman. The opinion of the court was delivered by Skillman, J.A.D.
This appeal involves a suit on a promissory note in the amount of $40,000. The face of the note indicates that the maker is defendant United Plastics Corporation, and it is signed by defendant Ronald J. Proudman, whose title is listed as "Pres.," and defendant Bruno Bizzaro, whose title is listed as "Sec." Proudman's and Bizzaro's signatures appear a second time on the back of the note immediately below the following words:
Each of the undersigned endorsers waives presentment, demand for payment, protest and notice of dishonor of this note. If two or more of the undersigned are joint endorsers, such waiver as to them shall be deemed joint and several.
There is no indication that the signatures on the back of the note are in any corporate capacity.
United Plastics made nine payments of $1,000 each on the note and then went into default. The present suit was filed against United Plastics, Proudman and Bizzaro. A default was entered against United Plastics, which is now apparently insolvent, and the case went to trial before a jury solely against Proudman and Bizzaro.
Plaintiff proved the execution of the note. In addition, the commercial loan officer who negotiated and approved the loan testified that he clearly communicated to Proudman and Bizzaro that they were assuming personal responsibility for repayment of the loan. This testimony was corroborated by the fact that personal financial statements of Proudman and Bizzaro, dated shortly before the loan was made, were in the bank's file.
At the close of plaintiff's case, Bizzaro made a motion to dismiss. During the colloquy on that motion the trial court raised a question whether plaintiff was obligated to proceed against the collateral for the note before seeking judgment against Proudman and Bizzaro. At the conclusion of the argument on the motion the following exchange occurred between the court and counsel:
THE COURT: If you will agree that you have nothing to offer other than this fact that they did not proceed against the collateral, I can enter judgment in your favor providing you admit that if Mr. Dreskin is right, that he didn't have to proceed against the collateral, you owe the bank $50,000 after Mr. Richardson pays first.
[Counsel for Bizzaro]: Based upon the rulings of the Court, of course. That's where I am at this point.
THE COURT: We can do that.
[Counsel for Proudman]: What you are saying is everyone can rest at this point?
THE COURT: I think we need the Appellate Division on this particular question and I think that's the way to proceed. I don't want it to go up to the Appellate Division and have you fellows say to the Appellate Division, well, we never put in our defense of fraud or misrepresentation, whatever.
[Counsel for Bizzaro]: I would just say to the Court my only defense is what I have expressed to the Court and that's (a) that my client never understood that he was going to be an endorser --
THE COURT: I have no trouble ruling on that.
[Counsel for Bizzaro]: -- and (b) in the absence of them demonstrating a proceeding against the collateral and claiming a deficiency there can be no ...