LONDON DISTRIBUTING COMPANY, APPELLANT,
v.
ALFRED J. BASTONE, APPELLEE

Fla. 3d DCA | 1971-02-23
No. 70-542
Before PEARSON, C. J., HENDRY, J., and VANN, HAROLD R., Associate Judge., PEARSON, C. J., concurs only in the conclusion reached.
244 So. 2d 550 Florida District Court of Appeal, Third District (1971) Positive Treatment
Cited by 2 cases

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Holding

The court held that the plaintiff's second amended complaint sufficiently stated causes of action for both accommodation maker liability and breach of an indemnification agreement, making judgment on the pleadings improper.


Headnotes

[1] A judgment for the defendant on the pleadings is proper only where the complaint is legally insufficient to state a cause of action.

[2] A complaint is legally sufficient to state a cause of action if it alleges facts that, if proven, would entitle the plaintiff to relief.

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Facts & Procedural History

Plaintiff London Distributing Company (London) executed a note to a bank to accommodate defendant Alfred J. Bastone (Bastone) and his corporation, Jam…

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Opinion of the Court
HENDRY, Judge.

HENDRY, Judge.

This is an appeal by plaintiff-appellant London Distributing Company (“London”) . from a final judgment entered on the pleadings in favor of defendant-appellee Alfred J. Bastone (“Bastone”). The pleadings are a second amended complaint and an answer consisting of a general denial and an affirmative defense of payment. See Rule 1.140, Florida Rules of Civil Procedure, 30 F.S.A.

The parties dispute which one of them is the surety and which is the principal debt- or, as respects their signatures on a negotiable promissory note governed by Florida’s Uniform Commercial Code. London urges that it accommodated Bastone individually, but Bastone asserts he accommodated London. We set out pertinent portions of London’s second amended complaint in a footnote.1 The note was' attached as an exhibit to the complaint.

*552The general rules governing appeals from judgments on the pleadings are set out in Butts v. State Farm Mutual Automobile Insurance Company, Fla.App. 1968, 207 So.2d 73. As that case indicated, a judgment for the defendant on the pleadings is proper where the complaint is legally insufficient to state a cause of action.

It is our view that each count of plaintiff’s second amended complaint is sufficient to state a cause of action, and therefore it was error to enter judgment on the pleadings.

We need not detail the reasoning or quote from provisions of Florida’s Uniform Commercial Code respecting the rights and liabilities of accommodation makers and endorsers. The following example from 1 Hawkland, Transactional Guide to the Uniform Commercial Code, § 2.2102, p. 564 (1964), closely resembles the allegations of plaintiff’s complaint:

“The principal is bound to reimburse the surety if the latter satisfies the principal obligation or any part of it. This right of reimbursement gives the accommodation party an opportunity to proceed on the instrument against the principal debtor, even though such proceedings run counter to the normal currents of liability on commercial paper. Thus, a maker-accommodation party may proceed on the instrument against an indorser if the indorser is the principal debtor (‘accommodated party’). An example of this situation would be where the payee lends money to A, M signs the note as a maker to accommodate A, and A signs it as an indorser. The payee can treat M as a maker and compel him to pay the instrument when it comes due. Thereafter, M can recover (reimburse himself) by suing A on the note.
“Similarly, M can subrogate to payee’s position and hold A. * * *” (Emphasis added).

Plaintiff, as his second point on appeal, asserts that the parties entered into an independent indemnification agreement, which he asserts is independently actionable. We agree. According to Simpson on Suretyship, § 48, p. 244 (1950), the general rule is:

“Upon payment the surety has the right to be reimbursed by his principal, and may recover in an action for money paid to the principal’s use or on a promise implied in fact * * * [T]he surety’s right to repayment as a present cause of action against his principal does not arise until after the surety has paid the creditor. A surety who became obligated without the consent of the principal would have no right in contract; if he has any right to reimbursement at all it must be upon the theory of unjust enrichment.”

It is our view that both counts of plaintiff’s second amended complaint state a cause of action. Accordingly, the judgment appealed is reversed.

Reversed.

PEARSON, C. J., concurs only in the conclusion reached.


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Citator

Cited By

  • London Distrib. Co. v. Bastone, 265 So. 2d 88 (Fla. 3d DCA 1972)
    …efendant, Alfred J. Bastone, in a suit upon a promissory note. The issues were tried by the judge without a jury, and after hearing the evidence, the court found for the defendant, Bastone. See: London Distributing Company v. Bastone, Fla.App. 1971, 244 So. 2d 550. Appellant contends that the undisputed evidence shows that the plaintiff was an [*89] accommodation maker and upon payment of the obligation became subrogated to the rights of the bank, and was entitled to recover against Bastone who was an endors…

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