Court Opinion

ID: 8192950
Source: CourtListenerOpinion
Date Created: 2022-09-09 23:16:04.20031+00
Date Added: 2024-06-11T16:40:40.087291
License: Public Domain

Vinje, J.
In their answers and upon the trial the appealing defendants claimed that the bond was given for a past indebtedness due plaintiff from Peterson; that no consideration moved from plaintiff to the sureties or to Peterson; and that the sureties were induced to sign the bond through fraudulent concealment of facts known to it but not to them, to the effect that Peterson was a defaulter. The trial court found against them upon the latter point. The alleged fraud consisted in plaintiff failing to inform the sureties of the fact that Peterson was already indebted to it at the time they signed the bond and that plaintiff had reason to believe that Peterson was a defaulter. Plaintiff had no communication whatever with the sureties before they signed. Under the rule of John A. Tolman Co. v. Butt, 116 Wis. 597, 93 N. W. 548, the finding of the trial court must be sustained.
The court, though requested to do so, refused to find *435upon the issue of whether or not the bond was given for a past indebtedness, and the court made no finding as to whether or not there was a consideration for the bond. In its decision it stated: “I think the question of want of consideration is not open and is concluded by the recitation in the guaranty contract regarding consideration.” If by this the court meant that defendants could not show want of consideration, then it was mistaken, for sec. 4195, Stats. 1898, in force at the time this bond was signed, provides, “A seal upon an executory instrument hereafter executed shall be received as only presumptive evidence of a sufficient consideration, which may bé rebutted as if the instrument was not sealed.” See, also, Carey v. Dyer, 97 Wis. 554, 73 N. W. 29. If the court meant that since no evidence had been introduced showing a want of consideration then the recitals in the bond controlled, it was correct. The law is well settled that there must be a new consideration moving either to the principal or to the sureties, or to both, or a detriment to the obligee, for a bond guaranteeing the payment of a past indebtedness of the principal. 21 Ruling Case Law, 959, 960; 20 Cyc. 1413; Bank of Commerce v. Ross, 91 Wis. 320, 64 N. W. 993.
Owing to the failure of the court to find upon the issue whether the bond was given for a past indebtedness, and, if so, whether any consideration moved from plaintiff to the sureties or to Peterson, we conclude that justice in this case has not been done, and that pursuant to the provisions of sec. 2405m, Stats. 1917, we must reverse the judgment as to the appealing defendants and send the case back to take further evidence, if either party desires it, upon the above issues not found, and for findings thereon and judgment in accordance with the findings made.
By the' Court. — Judgment reversed as to appealing defendants only, and cause remanded for further proceedings according to the opinion.