Cano v. Walker

The common-law rule in contracts that common-law rule that the release of one joint obligor on a promissory note operates to release all represents settled law in Nebraska and should have been applied by the district court in this case.Eric Cano brought this action against Michael Walker and Billy Claborn alleging that they had failed to pay amounts due on a promissory note, which imposed joint and several liability on Walker and Claborn. The district court entered summary judgment in favor of Cano. The court entered judgment on the promissory note. Thereafter, without the consent of Walker, Cano and Claborn entered into a stipulation that operated as an unconditional release of Claborn once he satisfied the terms of the stipulation. Walker filed a motion to discharge the judgment premised on the common-law rule that “[t]he unconditional release of one of several makers of a joint and several promissory note, without the consent of the other makers thereof, operates as a release of all.” The district court overruled the motion for discharge. The Supreme Court reversed and remanded with directions to grant the requested discharge, holding that, under the common-law rule, the unconditional release of Claborn from the judgment operated as a release of Walker. View "Cano v. Walker" on Justia Law