Opinion ID: 1341854
Heading Depth: 1
Heading Rank: 2

Heading: Medical Services' Defense

Text: Next, we consider whether the trial court correctly construed Medical Services' guaranty as a continuing one. Because Medcom was a new company without established credit, Weaver obtained from Medical Services a letter of guaranty. The letter, dated March 6, 1979, was written by Charlie Smith, a Medcom employee authorized by Medical Services to make the guaranty. The letter stated: Tis letter is in reference to our recent large orders. In the event that we discontinue buying from your company, for any reason, Medical Services of America agrees to purchase all stock for which you have purchase orders from [us]. The record shows that Medcom has paid for all purchase orders Weaver had on hand on March 6, 1979. Subsequently, at Weaver's request, Medical Services sent Weaver a second letter, guaranteeing Medcom's purchases made during the 90-day period beginning November 1, 1979. Likewise, the record shows that Medcom has paid for all purchase orders placed during the period provided in the second letter. Smith, called by Weaver, testified that the March 6 letter guaranteed only those purchase orders Weaver had on hand on March 6, 1979. Nevertheless, the trial court ruled that the March 6 letter, as a matter of law, continued to guarantee payment of all purchase orders received by Weaver after March 6, 1979. In support of its argument that the March 6 letter was a continuing guaranty, Weaver cites Pascoe Steel v. Shannon, 224 Va. 530, 298 S.E.2d 97 (1982), where we said: A guaranty, unlimited as to time, but given in circumstances evidencing the guarantor's intent to cover a series of transactions, will be construed as a continuing one. Id. at 534, 298 S.E.2d at 99. The guaranty in Pascoe, however, unlike the March 6 letter, expressly stated that it was a continuing guaranty, id. at 533, 298 S.E.2d at 98, covering all liabilities incurred now or at any time hereafter, Id. at 532, 298 S.E.2d at 97. The March 6 letter was written in reference to Medcom's recent large orders and informed Weaver that, in the event Medcom discontinued purchasing parts from Weaver, Medical Services would purchase all stock for which [Weaver had] purchase orders from [Medicom]. The March 6 letters is susceptible to more than one reasonable interpretation, one being the interpretation given by Smith. Moreover, a jury reasonably could infer that Weaver's request for a second guaranty supports Smith's interpretation of the March 6 letter. Because reasonable minds could differ as to the meaning of the March 6 letter, we hold that the trial court erred in refusing to submit the resolution of this issue to the jury.