#### First State Bank of Brillion, Appellant, vs. Boetcher and others, imp., Respondents.

*September 16*

October 7, *1913.*

*Guaranty: Construed to be prospective: Renewal notes.*

1. Guaranties will be construed to be prospective rather than retrospective unless it clearly appears that they were intended to cover past transactions.

2. An instrument reciting that it was given in consideration of the “making advances or giving credit,” guaranteeing payment of “all moneys that shall at any time be due” from C. B. or B. *&*Co. “on any balance of his or their account or indebtedness . . . *incurred with 'reference to this agreement,”*and providing that “this guaranty shall be a continuing guaranty and apply to future advances,” did not cover indebtedness existing at the time the instrument was executed nor notes thereafter given merely in renewal of those evidencing such indebtedness.

Appeal from a judgment of the circuit court for Brown county: S. D. IIastiNgs, Circuit Judge.

*A firmed,.*

This action was brought to recover balances due on three several promissory notes executed by Charles Boetcher and Louise Boetcher. The makers of the notes were made parties defendant, as were *Fred Boetcher, O. F. Werner,*and *B. G. Werner,*against whom liability was claimed as guarantors. The action was tried by the court and judgment was entered against the defendants Charles and Louise Boetcher for the amount found due on the notes. As to the other defendants judgment was entered dismissing the complaint with costs. The plaintiff appeals from this portion of the judgment. The guaranty involved reads as follows:

“In consideration of your making advances or giving credit to Charles Boetcher individually or to himself and Louise Boetcher, copartners under the firm name and style of Boetcher & Co., doing business at the village of Brillion, Calumet county, Wisconsin, ■ we, the undersigned, hereby *445guarantee tbe payment to you, *The First ¡State Bank of Brillion*(a banking corporation organized and existing under and by virtue of tbe laws of tbe state of Wisconsin, doing -business at tbe village of Brillion, Calumet county, Wisconsin), of all moneys that shall at any time be due from tbe said Ohas. Boetcber, individually ór from tbe said Boetcber *;&*Go., or bis or tbeir representatives on any balance of bis or tbeir account or indebtedness to you, incurred witb reference to tbis agreement not exceeding th$ sum of five thousand dollars. Tbis guaranty shall be a continuing guaranty and apply to future advances and when balances are at' any time fully paid it shall apply to other future advances to the extent aforesaid. You may give time to tbe said Charles Boetcber or to tbe said Boetcber & Company, renew bis or 'tbeir notes, compromise witb him or them or witb any persons liable secondarily in consequence of'bis or tbeir indebtedness to .yon without impairing or affecting tbis guaranty. You may take other securities as collateral and for any excess over said limit, may satisfy such excess out of the same, it being understood that as to any collaterals you may bold at tbe time I make a payment in full, my right of subrogation may attach when you decline to make further advances. Tbis guaranty, however, to end and determine upon my decease on your •being notified thereof. Any settlements, accounts stated or agreed balances made in good faith between you and tbe said Charles Boetcber or said Boetcber & Company, shall be binding and conclusive upon me. Liabilities hereby incurred by . me to be due and payable within thirty days after notice requiring such payment has been delivered to me or sent by mail by you to me or my personal representatives.”

- Tbe court found on sufficient evidence that at tbe time tbis guaranty was executed Charles and Louise Boetcber were indebted to tbe plaintiff in tbe sum of about $6,000, which indebtedness was evidenced by notes then outstanding; that no additional loans were made to said parties after tbe guaranty was given; that tbe indebtedness existing at tbe time tbe guaranty was given bad been reduced to about $1,500; that tbe notes outstanding which evidenced tbis indebtedness of $1,500, while given after tbe guaranty was signed, were *446in fact renewals of notes outstanding on tbe date tbe guaranty was executed; tbat one of tbe principal debtors induced tbe alleged guarantors to execute tbe instrument of guaranty, and after be secured tbe execution of tbe instrument delivered tbe same to tbe bank; tbat no notice was given to tbe guarantors tbat tbe bank accepted tbem as sucb or relied on tbe guaranty until about April 30, 1910, at wbicb time all tbe notes in suit were outstanding.

Eor tbe appellant there was a brief by *F. M. Wilcox*and *Nash <& Nash,*and oral argument by *A. L. Nash.*

Eor tbe respondents there was a brief by *Mougen & Brady,*and oral argument by *A. L. Mougen.*

BaeNES, X

The trial court held that the document in question was not a contract of guaranty, but simply an offer wbicb would not become a binding contract until it was accepted by the bank and notice of such acceptance given to the guarantors. This conclusion was reached on the authority of *Miami Co. Nat. Bank v. Goldberg,*133 Wis. 175, 113 N. W. 391, and *A. B. Kuhlman Co. v. Cave,*135 Wis. 279, 115 N. W. 793, and decisions cited in those cases. It might be further said that it was at least assumed in *Sentinel Co. v. Smith,*143 Wis. 377, 127 N. W. 943, that the law was correctly stated in the two prior decisions.

Tbe trial judge further held tbat tbe alleged guaranty did not cover indebtedness existing at tbe time tbe paper was signed. As we think tbe court was correct in reaching this conclusion, and inasmuch as it disposes of tbe case, it is unnecessary to pass upon tbe other ground of nonliability wbicb was found to exist.

Tbe instrument recites tbat it is given in consideration of tbe “making advances or giving credit” and guarantees tbe payment of “all moneys tbat shall at any time be due from Charles Boetcher individually or from said Boetcher *&*Company ... on any balance of bis or their account . . . *in**447*curred with reference td this*agreementIt then proceeds that “this guaranty shall be a continuing guaranty *and apply, to future advances*

It is clear that indebtedness due or to become due from Charles and Louise Boetcher to the bank when the guaranty was given was not incurred with reference to the guaranty. It is just as clear that thp guaranty, only covered indebtedness incurred in reference thereto. The renewal of notes which evidenced indebtedness existing at the time the guaranty was signed did not create any new indebtedness. Neither did it give any new or additional credit. Such action simply extended the time of payment of the old obligations. *Deseret Nat. Bank v. Burton,*17 Utah, 43, 53 Pac. 215; *Drake v. Sherman,*179 Ill. 362, 53 N. E. 628; *Whitehead v. American L. & B. Co.*70 N. J. Eq. 581, 62 Atl. 554. Guaranties will be construed to be prospective rather than retrospective, unless it clearly appears that the parties intended that they should cover past transactions. 1 Brandt, Suretyship & G. (3d ed.) § 108; *Nat. Bank v. Rockefeller,*174 Fed. 22; *People v. Lee,*104 N. Y. 441, 10 N. E. 884; *Pritchett v. Wilson,*39 Pa. St. 421. The court, having found on sufficient evidence that the notes sued upoh evidenced indebtedness existing at the time the alleged guaranty was given, was right in holding that the guarantors were not liable on their undertaking even though it was in full force and effect.

It is argued that the guarantor *Fred Boetcher*acknowledged his liability on the guaranty and agreed to pay before suit was commenced and that recovery should be had against him in any event on his new promise. There was no consideration to support the promise, if one was made, and we do not think the evidence shows that a promise was in fact made.

*By the Court.*— Judgment affirmed.