Case ID: scl_44/html/0323-01.html
Source: Caselaw Access Project
Author: {"author": ".Wardlaw, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Joseph Lawton & Co. vs. W. F. & S. P. Maner, Ex’ors.
    M. wrote to L. & Co.: — Mr. B. informs me, that, in a conversation with Mr. S. of your firm, he stated to B. ‘ if he would get me to be responsible for him to you, or in other words to give B. a letter of credit to you, he would sell him on longer time, say nine months or one year. This is therefore to inform you that I. will be responsible for B. to the amount of one thousand dollars’: — Held, to be a continuing guaranty until goods to the amount of one thousand dollars were purchased,„but no longer.
    The goods were purchased from time to time, in separate parcels, and for each parcel B’s note was taken at six months : — Held, that the taking of notes was no waiver of the right to resort to M.; and that it was not a condition of the guaranty that at least nine months credit should be given to B,
    M. was held, not to be liable.for interest.
    BEFORE WHITNER, J., AT. BEAUFORT, SPRING TERM, 1856.
    Tbe report of bis Honor, tbe presiding Judge, is as follows:
    
      “ Tbis was an action of assumpsit, brought to recover for goods sold and delivered to E. B. Baker, on a guaranty of defendant’s testator, as contained in a letter of wbicb tbe following is a copy; “Brighton, S. C., Eeby. 6th, 1851.— Messrs. Joseph Lawton & Co. — Gentlemen: Mr. Baker informs me he bad a conversation with Mr. Smith (of your firm) in wbicb be stated to Mr. Baker, if be would get me to be responsible for him to you, or in other words, to give Mr. Baker a letter of credit to you, he would sell Mm on longer time, say nine months or one year. Tbis is therefore to inform you that I will be responsible for Mr. Baker for the amount of one thousand dollars '($1,000). Respectfully, Jobn. S. Maner.” Goods were sold and delivered by plaintiffs to E. B. Baker, to wit:
    lltb February, 1851, amount . . . $581 61
    29tb April, 1851, “ . . . 186 32
    23d October, 1851, “ . 360 82
    4tb March, 1852, “ 341 25
    Amounting in the whole to $1,470 00
    “These accounts were each liquidated by notes at six months, the first being credited,
    17 January, 1852, with . . . $200 00
    24 March, 1852, “ 304 08 504 08
    Leaving a balance on account purchases, $965. 92 “ These items appear from the bill of particulars, admitted to be correct, though on the trial it was stated generally, amount of account, .... $1,470 00
    Amount of credits .... 508 08 $961 92
    Amount for winch I think verdict was rendered with interest. It was in evidence that Mr. Baker and Major Maner in 1849, 1850,, 1851 and 1852, lived in the same neighbourhood, in St. Peter’s Parish, on terms of great intimacy, the former engaged in a small mercantile business, first at BisKopvilM within two miles of the latter, and afterwards at Brighton, in a house built on lands of Major Maner, seven miles distant from him, and by which Major Maner passed frequently on his way to • his plantation. Baker was a man of limited means, and continued in business at Brighton until and for a short time' after Major Maner’s death. The latter was a ■man in affluent circumstances. He died June, 1852. After the death of Major Maner, the defendants addressed a letter to the plaintiffs on this subject, to wit: ‘ Brighton, June 22d, 1853. ■ — Messrs. Joseph Lawton & Co. — Gentlemen: We received your letter a few days since, and would have replied sooner but waited to see Mr. Baker, who says he is unable to do any thing at this time, but will try to make arrangements to have a settlement with you next fall. If be fails in so 'doing, we will endeavor to make your claims against him good. Please inform us bow tbis arrangement will suit you. Yery respectfully, W. E. & S. P. Maner.’ A letter was also read from attorney of executors, January 23d, 1854, asking a statement of these claims, of which I took no other note.
    “The plaintiffs claimed to recover the entire balance of these purchases, with interest, and defendants, resisting all liability on the guaranty for want of notice of its acceptance, insisted that at most the recovery should be limited, to the amount of first parcel of goods taken- up, less the sums paid by Baker. I did not think either view gave the true amount for which defendants were liable,. but for the purpose of ending the litigation on this subject, I thought it better, after the jury had passed upon the question of notice, to direct a general verdict for the. balance of the amount of purchases with interest. My own impression is that there was a continuing guaranty until the sum of one thousand dollars should be taken up in the purchase of goods, and that any sums subsequently paid on account of their dealings, should enure to the benefit of the guarantor, and 'to that extent discharge the guaranty, the true sum, being four hundred and ninety-six dollars and .ninety-two cents, with interest thereon.
    “ On the subject of the notice of acceptance of the guaranty, the jury were instructed in conformity with the principles set forth in the opinion' delivered when this case was before the Court of Appeals, January Term, 1856, and this question was resolved by the jury in favor of plaintiffs.
    “My attention was not called to the points raised inlthe sixth and seventh grounds of .appeal, on the circuit, nqr was I aware of the terms of the notes given, until I was furnished with the bill of particulars, and grounds of appeal. The fault was, perhaps, my own, but, at least, tbe defendants should not be prejudiced.”
    The defendants appealed, and now moved this Court for a new trial, on the grounds
    1. Because His Honor erred in charging the jury that the writing declared on was a continuing and not a limited guarantee, and -the jury erred in so finding.
    2. Because his Honor erred in charging that the plaintiffs were entitled to recover, under a guarantee limited to one thousand dollars, the difference between the plaintiffs’ entire demand, (which greatly exceeded that sum) and the payments made by Baker; and the verdict of the jury rendered in conformity thereto, was erroneous, it being respectfully submitted, that, under no construction of the guarantee, could the plaintiffs be entitled to recover more than the difference between one thousand dollars and the payments made by Baker.
    3. Because his Honor erred in not charging the jury that the claim of the plaintiffs against the defendants was limited to the amount of the first parcel of goods taken up by Baker, < diminished by the amount of the payments made by him; and the verdict of the jury in finding a larger sum, was erroneous.
    4. Because his Honor erred in charging, and the jury in finding interest on the amount claimed by the plaintiffs.
    5. Because there was no sufficient evidence of notice to the guarantor that his guarantee had been accepted, upon which to found a verdict for the plaintiffs.
    6.Because the plaintiffs, by taking notes from Baker for tbe amount of bis purchases, waived whatever other rights they might have otherwise had against the guarantor, by virtue of his guarantee; and his Honor erred in charging and the jury in finding otherwise.
    7. Because 'there was no evidence of any credit having been extended to Baker by the plaintiffs on the faith of Maner’s guarantee — the bill of particulars exhibiting an indebtedness by Baker, as agent, and the credit being limited to six months, and his Honor should have so charged the j™7-
    8. Because the charge of his Honor and the verdict of the jury were in other respects contrary to law and to the evidence.
    Fielding, for appellants.
    Even if entitled to recover any thing under this guaranty, the claim of plaintiffs is limited to the amount of the first parcel.of goods taken up by Baker dminished by the amount of payments made by him. This is a limited and not a continuing guaranty. In order to ascertain the nature of the instrument, we must look to the intention of the parties, so far as it can be gathered from the language used. . Formerly it was held that á guaranty must be most strictly construed against the guarantor, but the rule as above laid down is now recognized by the Courts both in this country and in England. What then was the intention of the parties? If we scrutinize the language of the guarantee, we shall not be able to find a single expression which contemplates a continuous dealing between Baker and Lawton & Co. The language of this instrument is still more limited and carefully guarded, than the language of the instrument upon which the Court passed in the cases of Boyce & Henry vs. Fwart, Bice, 126; Rogers & 
      
      Lambert vs. Warmer, 8 Johns. E. 92; 3 Bam. & A'ld. 595; 1 Bail. 620; yet these were all held to be limited guarantees.
    The defendants at least axe not liable for interest. Bishop vs. Boss, Eice, 21.
    But was Maner liable at all ? The whole course of dealing between the parties shows that no credit was extended to Baker, by the plaintiffs, on the faith of Maner’s guarantee. The notes taken from Baker, if not a liquidation of the original debt, prove that Lawton was dealing with Baker on his own responsibility. The account was charged against Baker as agent. Maner agreed to guaranty payment for goods purchased by Baker for his own use — not those .which Baker might purchase as agent of another. The condition of Maner’s guarantee was that Baker should have a credit of nine months. This condition not having been complied with, the guarantor is discharged. 15 Eng. O. L. E. 514; 19 Eng. C. L. E. 479; 25 Eng. C. L. E. 413. An express condition is to be extended to all parts of the contract. 52 Eng. C. L. E. 643.
    Treville, contra.
    The undertaking of Maner was a continuing guaranty. This is evident from the nature of the instrument which is a “ letter of credit,” given to a country merchant, addressed to merchants in the city, and which must therefore, be supposed to contemplate a series of transactions. This' case cannot be distinguished from the case of Mason vs. Pritchard, 12 East, 429, and the cases cited in Chitty on Contracts, 525. The case in 3 Barn. & Aid. 595, has been shaken by subsequent adjudications and is not now régarded as authority. Chitty on Contracts, 525. The case of’ Boyce & Henry vs. Hwart, Eice, 126, was decided on another ground. Upon this point the Judges could not agree.
   The opinion of tbe Court was delivered by

.Wardlaw, J.

This Court is satisfied with the finding that the defendant’s testator had notice of the acceptance of his guaranty. See former opinion in this case, 9 Eieh. 335.

The matters contained in the sixth and seventh grounds of appeal were brought out on the trial, although, under the pressure of circumstances which limited time on the Circuit, they were not urged in argument, there. They are now properly before this Court, and have been considered.

As a promissory note does not extinguish an open account, unless it has been paid or accepted in payment, the fact, that the plaintiffs took from Baker his note for each parcel of goods delivered, shows no waiver of their right to resort to the guarantor. The circumstance, that in the bills of parcels, Baker is styled agent,” is equivocal and indecisive. It appears by the notes that credit in each instance was given for only six months, and this is more important. The guaranty speaks of “ longer time, say nine months or a year.” It does not appear what was the credit that had been previously extended to Baker, and a buffer credit was probably given when six months were allowed. One who would avail himself of a guaranty must comply strictly with its conditions, but that which is urged as a condition must appear by fair construction to have been intended to modify the obligation. In this guaranty the specification of "nine months or a year,” under the general expression of “lohger time,” seems too loose to raise a condition that the credit should be at least nine months; and the whole may be fairly construed to be mere inducement. Because Baker had made communication to Maner of what Smith had held out, therefore Maner was willing to give his “ letter of credit.” The extent of advantage which Baker should derive from the letter, was left to negotiation between him and the plaintiffs.

Upon the question which has been mainly argued, this Court looking to all the terms of the guaranty and the circumstances wbicb surrounded tbe parties, is of opinion that tbe guaranty was limited to tbe amount of one thousand dollars, but was continuing until that amount of goods was received by Baker on credit; that it was not confined to tbe first parcel or first transaction, nor extended to tbe whole course of dealings, so as to cover a final balance of one thousand dollars or less.

Tbe many cases wbicb have been cited, stand each upon its own words and circumstances. In this case, a philological analysis would not carry conviction of tbe correctness of tbe conclusion we have attained, if a careful reading of tbe guaranty and remembrance of tbe various relations of tbe parties stated in tbe report, should fail to establish such conviction.

‘'Letter of credit” and the nature of tbe dealings between a shopkeeper and a jobber, are strong- to show that more than a single transaction was contemplated: tbe absence of time to time, any, and other like terms wbicb ordinarily are used to embrace all future dealings-, shows that tbe specified amount was intended to limit tbe whole responsibility wbicb from beginning to end tbe guarantor would assume.

It follows that from tbe one thousand dollars, should have been deducted tbe payments made by Baker of five hundred and four dollars and eight cents, to wbicb tbe guaranty bad attached, so as to leave a balance of four hundred and ninety-five dollars and ninety-two cents, yet covered by it. Upon that balance, interest from tbe expiration of tbe credit given, or from tbe demand made upon tbe guarantor’s executors, has been claimed by tbe plaintiffs, and with much apparent justice. But according to our case of Bishop vs. Ross, Rice, 21, no interest can be recovered. Tbe guarantor’s liability arose from Baker’s default to pay for goods sold to him; tbe guaranty was not of notes, but of an account; it is in writing and therefore binding, but tbe writing does not affect tbe character of tbe debt it was intended to secure; as interest could not be recovered on an account for goods sold, so it cannot be recovered on a guaranty of sucb an account. This view was taken in Bishop vs. Ross, and we will not now examine its propriety.

It is therefore ordered that a new trial be granted, unless the plaintiffs enter a remitter for all that has been found for them by the verdict, beyond four hundred and ninety-five dollars and ninety-two cents.

O’Neall, Withers, Whither and Muhro, JJ., concurred.

New trial, nisi.