Court Opinion

ID: 8016557
Source: CourtListenerOpinion
Date Created: 2022-09-09 02:05:20.535699+00
Date Added: 2024-06-11T16:36:22.243267
License: Public Domain

DISSENTING OPINION.
VATU ANT, J.
' To the extent that the words in which a contract is expressed leave its meaning in doubt, it must be interpreted in the light of the circumstances surrounding the parties at the time it was made. When this contract of guaranty was made You-man was about to enter into a contract with the city for the construction of a sewer. The city required *186that he should give bond and security for the faithful performance of his contract, particularly that he would pay for all labor and materials that went into the construction of the work. An estimate of the probable cost of the work was made by the city engineer, this estimate was $83,540. But it was contemplated that the work might exceed the estimated amount and that fact was in the minds of the parties when they made this contract.
When the sureties were asked to go on this bond and guaranty that the contractor would pay for all labor and materials used, the natural inquiry would be what is thé extent of the undertaking, to what extent are we to be obligated? To this the obvious answer was, it is estimated that the cost will be $83,540', but it may go beyond that, how much no one can .say. In the face of that uncertainty the sureties had this clause limiting their liability inserted, and in my opinion it was intended to mean that, we guarantee that the contractor will fulfill his obligation up to the amount of the estimated cost, but not up to an indefinite amount beyond. In entering into contracts of this kind men must be credited with some degree of care and forethought. When one goes security for another, especially when the going of security is in itself a business transaction, he usually takes means to ascertain what the man is worth and what are his means of fulfilling his engagement and he circumscribes his guaranty to that estimated capacity.
Suppose that instead of a contract worded as this is a contract had been presented to these sureties saying in plain terms, it is estimated that this work will cost only $83,540, but it is liable to go much beyond that, and though in the course of its performance the contractor should faithfully pay for labor and materials consumed sums aggregating $83,540, yet the sureties on this bond are bound to the further extent of *187$83,540 for other labor and materials beyond that so paid for by tbe contractor, can we conceive a sane business concern signing such a guaranty? Yet, by interpretation that is what this contract is said to mean. Of course if that is what this contract means we have got to enforce it regardless of what we may think of the wisdom of the men who signed it; but if it is a question of construction we ought not to give it that construction, if there is one, more in line with usual business thought.
The evidence shows that the contractor paid an amount far in excess of the $83,540, and therefore in my opinion the sureties are not bound for anything remaining unpaid.