Court Opinion

ID: 9789573
Source: CourtListenerOpinion
Date Created: 2023-08-31 01:38:34.339175+00
Date Added: 2024-06-11T07:37:23.257899
License: Public Domain

*787BACON, Judge
(dissenting).
The majority opinion concludes the instrument in question was merely an “offer of guaranty” as opposed to a “completed contract of guaranty.”
The conclusion reached in the majority opinion is based on T. & H. Smith & Co. v. Thesmann, 20 Okl. 133, 93 P. 977 (1908) wherein the court held the instrument was an “offer of guaranty.” I am of the opinion the instrument in the present case is a completed contract of guaranty even under Thesmann, supra.
In Thesmann, a merchant sent an order for certain goods to be shipped to him. The merchant had his brother execute a “guaranty” on the same order whereby the brother guaranteed payment of the goods. The court in Thesmann rightfully held such was merely an offer of guaranty and because no notice of acceptance of the order was sent to the “guarantor,” the “guarantor” was not liable.
The Thesmann court in distinguishing an offer of guaranty as opposed to a completed contract of guaranty said:
“It is a settled rule of law of the Supreme Court of the United States that, before a guarantor is bound by any offer of guaranty, the guarantee must have accepted the offer of guaranty, and the guarantor received notice of such acceptance; and the same rule prevails in nearly all of the state courts. There is no little confusion and what appears to be contradiction in the decisions of many of the state courts, but most of this confusion, and what appears to be conflict of authorities, result from the courts construing very similar instruments in some cases to be offers of guaranty and in other instances as being absolute guaranties, or completed guaranty contracts. The Supreme Court of the United States, in construing an instrument similar to the alleged guaranty in this case, in the case of Davis Sewing Machine Co. v. Richards, 115 U.S. 524, 6 S.Ct. 173, 29 L.Ed. 480, summed up the rules of law governing that court as follows: ‘A contract of guaranty, like every other contract, can only be made by the mutual assent of the parties. If the guaranty is signed by the guarantor at the request of the other party, or if the latter’s agreement to accept is contemporaneous with the guaranty, or if the receipt from him of a valuable consideration, however small, is acknowledged in the guaranty, the mutual assent is proved, and the delivery of the guaranty to him or for his use completes the contract; but if the guaranty is signed by the guarantor without any previous request of the other party, and in his absence, for no consideration moving between them except future advances to be made to the principal debtor, the guaranty is in legal effect an offer or proposal on the part of the guarantor, needing an acceptance by the other party to complete the contract.’ ”
It seems to me from the above-quoted language that if the contract is made with (a) mutual assent and (b) is delivered, the contract of guaranty is completed. The above language in Thesmann quoting from Davis S. M. Co. v. Richards, 115 U.S. 524, 6 S.Ct. 173, 29 L.Ed. 480 (1885) says mutual assent is proven when “receipt of a valuable consideration, however small, is acknowledged in the guaranty . . .” and if the instrument is delivered, a contract of guaranty is complete. In the present case the contract provides “the undersigned guaranty the payment . in consideration thereof, and in consideration of the benefits to accrue to the undersigned therefrom . . . .” Additionally the instrument was delivered. It seems to me at this point a contract of guaranty was completed under Thesmann, supra, and Davis S. M. Co., supra.
The majority opinion places great weight on the language “to induce you to release” and makes this language the equivalent of a condition precedent to the guaranty becoming binding, as was the case in Thes-mann. However, as I view the facts of Thesmann with the facts of this case, in Thesmann the parties were purchasing goods and the guaranty was conditioned upon the goods being sold or notice of acceptance being given to the guarantor. In *788the present case, I feel the language “to induce you to release” was not tantamount to words of condition but was merely a recitation as to the purpose for which the guaranty was given. Additionally, I believe the contract in the present case was a completed contract of guaranty because the contract itself says that it “. . .is an absolute and continuing guaranty of payment in any event . . . .”
Inasmuch as I am of the opinion the contract was a completed contract of guaranty, Justice would not have the burden to prove the Justice mortgage was released to recover on the contract.
Failure to release the Justice mortgage might amount to a failure of consideration of the guaranty contract, but such is defensive in nature to be proved by defendants when they present their case.
I am therefore of the opinion that when Justice introduced the contract of guaranty in its case in chief it met its burden of proof and the trial court correctly overruled defendants’ demurrer to Justice’s evidence.
I would affirm.