p. 461The Bank of Poughkeepsie vs. Ibbotson.Headnote
The stockholders of a manufacturing corporation created under the act of March 22d, 1811, (3 R* S, 220,) are severally and not jointly liable for the debts due from the company at the time of its dissolution.Accordingly, where a creditor of such corporation, after its dissolution, released one of the stockholders from all claims and demands; held, that the release did not operate to discharge the others.
Semble that, notwithstanding the act of April 18th, 1838, (Sess. Laws of 1838, jp. 243,) if a creditor execute a technical release to one of several joint debtors, absolute in its terms, and not qualified by a reference to the act, it will operate as a discharge of all. Per Bronson, J<
Assumpsit against the defendant as a stockholder in “ The New-York Stock Frame and Cotton Manufacturing Company,” to recover the amount of a debt due from the company to the plaintiffs; the company, as ivas alleged, having been dissolved. The same case was formerly before the court on demurrer to the plaintiff’s declaration. ( See 24 Wend. 473 .) An issue of fact was afterwards joined, and the cause was tried before Kent, C. Judge, at the New-York circuit, in January, 1842. On the trial, it appeared that the plaintiffs had executed a general and unqualified release to Lewis Tappan, who Avas one of the stockholders of the company, by which he was absolutely released from all claims and demands. The defendant moved for a nonsuit, on the ground that the release of one stockholder operated as a release of all of them. The judge overruled the motion, and the plaintiffs had a verdict. The defendant now moved for a new trial on a case, with leave to turn the same into a bill of exceptions.
A. H. Dana, for the defendant.
S. A. Foot, for the plaintiffs.
When several persons are bound by a joint, or joint and several obligation, the unqualified release of
p. 462one of the obligors will operate as a discharge to all of them.
(Bronson v.
Fitzhugh, 1
Hill, 185 ;
2 Salk. 574;
2 Saund. 47,
note 1.) But where the obligors are only bound
severally, the case does not come within the rule, and the release of one will not discharge the rest.
(Mathewson v.
Lydiate, Cro. Eliz. 408, 470, 546;
Bac. Ab. tit. Release (G) 7th Lond, ed.) The shareholders of manufacturing corporations created under the act of 1811, are under a
several and. not joint liability to the creditors of the company. This was settled when the case was before us on demurrer. ( 24
Wend. 473 .) It follows, that the release of Tappan did not discharge the other shareholders.
If this had been a joint obligation, I am inclined to think that the “ act for the relief of partners and joint debtors,” (Stat. 1838, p. 243,) would not take the ease out of the operation of the common law rule in relation to the effect of an unqualified release. The statute seems not to contemplate the giving of a technical release to one of the partners or joint debtors; and if such an instrument may be safely executed, it should at the least be qualified by a reference to the statute, for the purpose of showing that the parties were acting under that authority. If there be no such reference, and the release is absolute in its terms, it will be difficult to limit the effect of the instrument so that it will not operate as a discharge of all the joint debtors. (Bronson v. Fitzhugh, 1 Hill, 185 , and the cases there cited.) But that question is not necessarily involved in the case, as this liability was several and not joint.
The other questions in the cause were disposed of on the argument.
New trial denied.