RIGHTS OF SURETY AGAINST PRINCIPAL.
32. Until default, the surety has, in gene ral, no rights against the principal, except the passive right to be discharged from the obli gation on the conditions stated before. But after default on the part of the principal, and before the surety is called upon to pay, the latter has a remedy against the further con tinuance of the obligation, and he cannot in all cases, as we shall see below, oompel the creditor to proceed against the debtor ; but the English courts in equity allow him to bring a bill against the debtor, requiring him to exonerate him. 2 Brown, Ch. 579.
So, in this country, a surety for a de'..t which the creditor neglects or refuses to en force by proper proceedin.ge for that purpose may, by bill in equity, bring both debtor and creditor before the court, and have a decree to compel the debtor to make payment and discharge the surety, 5 Sneed, Tenn. 86; 3 E. D. Smith, N. Y. 432; and in courts having full equity powers there can be no doubt of the right of a surety, after a debt has become due, to file a bill to compel the principal debtor to pay, whether the surety has himself been sued or not. 2 Md. Ch. Dec. 442. 4 Johns. Ch. N.Y. 123.
33. The surety, after payment of the debt; may recover the amount so paid of the prin cipal, the process varying according to the practice of different courts. 2 Term, 104; 4 Me. 200; 1 Pick. Mass. 121; 1 Mete. Mass. 389; 3 id. 169 ; 13 Ill. 68. The liability as sumed by the surety is held to be a good con, sideration to sustain another. contract. 21 Pick. Mass. 241.
And such payment refers back to the ori ginal undertaking, and overrides all inter mediate equities, as of the assignee of a claim against the surety assigned by the principal before payment. 28 Vt. 391.
The .payment must not be voluntary, or made in such a manner as to constitute a purchase ; for the surety, by purchasing the claim, would take the title of the creditor, and must claim under that, and not on his own im plied contract of the principal. By an invo luntary payment is intended only a payment of a claim against which the surety cannot defend. It is not necessary that a suit should be brought. But a surety who pays money
on a claim which is absolutely barred has no remedy against the principal. 3 Rand. Va. 490; 3 N. H. 270.
A surety, having in his hands funds or se curities of the principal, may apply them to the discharge of the debt, 10 Rich. Eq. So. C. 557 ; but where the fund is held by one surety he must share the benefit of it with his co surety. 3 Jones, Eq. No. C. 170: 28 Vt, 65. But a surety who has security for his liability may sue the principal on his implied promise all the same, unless it was agreed that he should look to the security only. 4 Pick. Mass. 444.
Payment of a note by a surety by giving new note is sufficient payment, even if the new note has not been paid when the suit is .commenced, 4 Pick. Mass. 444; 14 id. 286 ; 2 Mete. Mass. 561 ; 2 All. Mass. 474; 3 N. H. 366 : contra, where judgment had been ren dered against the surety, 3 Md. 47 ; or by conveyance of land. 11 Mass. 494; 9 Cush. Mass. 213.
If the surety pays too much by mistake, he can recover only the correct amount of the principal. 1 Dane, Abr. Mass. 197. If a surety pays usurious interest to obtain time to pay the debt of the principal, he cannot recover it of the principal. 1 Mich. 193.
Extraordinary expenses of the surety, which might have been avoided by paymeht of the mancy. or remota and unexpected conse qusnees, are never considered as coming within the contract. 17 Mass. 169; 5 Rawle, Penn. 106. Costs incurred and paid by the surety in litigating in good faith the claim of the creditor can be recovered of the prin cipal, 30 Vt. 467 ; 5 Barb. N. Y. 398 ; but not so if the litigation is in bad faith, 24 Barb. N. Y. 546, or where the surety, being in demnified for his liability, incurred expenses in defending a suit contrary to the expressed wishes of the principal and after baing no tified by him that there wns no defence to such action. 22 Conn. 299.
Joint sureties who pay the debt of the principal may sue jointly for reimbursement, 3 Mete. Mass. 169; and if each surety has paid a moiety. of the debt, they have several rights of action against the principal. 20 N. H. 418.