Court Opinion

ID: 6965390
Source: CourtListenerOpinion
Date Created: 2022-07-24 01:52:53.50672+00
Date Added: 2024-06-11T16:08:35.536096
License: Public Domain

Subsequently, on petition for re-hearing, the following additional opinion was filed: Per Curiam : Upon the filing of the foregoing opinion, judgment was entered reversing and remanding the cause for a new trial. Upon petition for re-hearing points were made to which our attention had not been directed, and we have again considered the case. Counsel for appellees, conceding the correctness of the views expressed, insist that a reversal should not be had because of the error in giving said instruction, for the reason that at the time Mrs. Zuckerman became insolvent November 24, 1887, there was more than $1,500 of the indebtedness to plaintiff not due, and in respect of which there had been no default of payment; and the rule being that in case of insolvency, notice of non-payment in such case being without avail, and not required to be given, the guarantors were not released from liability in respect of such indebtedness. It is conceded that over $1,500 of the indebtedness from Mrs. Zuckerman to plaintiffs had not matured at the date she became insolvent. It is, therefore, said that if the instruction is erroneous, as applied to the facts of this case it was not prejudicial error. It would follow from the principles before announced, if the amount of $1,500 was due when this suit was brought, which was not due on the 24th of November, 1887, notice of non-payment thereof would have been unavailing to the guarantors. It is insisted, however, that although there was over $1,500 not due from Mrs. Zuckerman when she became insolvent, the guarantors were discharged from liability, because after the execution of the guaranty she made default in payments in excess of $1,500, of which no notice was given to the guarantors. It is shown that, commencing in February, 1887, considerable balances remained unpaid, and on the 18th of April, 1887, she was in default in payment of over $1,800, and that a note or notes were taken in settlement of the amount then due; that subsequently to that date she was in default in payment of various sums aggregating, October 24, 1887, something over $1,100. As this cause must be again submitted for trial, we have deemed it proper to notice this insistence. The position of appellants is untenable. They guaranteed the prompt payment at maturity of any indebtedness owing by Mrs. Zuckerman to the plaintiffs for goods purchased, or thereafter to be purchased of them, to the amount of $1,500. This amount stated in the guaranty was a limitation upon the liability of the guarantors, and not a limitation upon the credit to be extended to Mrs. Zuckerman. It was, as we have seen, a continuing guaranty, and plainly contemplated that payments made, or indebtedness otherwise settled by Mrs. Zuckerman, should not in any wise affect their liability for inbebtedness incurred by her for goods purchased and not paid for at maturity. The contract of guaranty looked to a future course of dealing for an indefinite time, that is, a succession of credits was to be extended, and the guarantors undertook to be liable to the extent of $1,500 for any indebtedness contracted in the course of such dealings, and not paid by Mrs. Zuckerman at maturity. Without extending this opinion by citation-from the authorities, it will be found that the position taken is supported by Bent et al. v. Hartshorn, 1 Metc. 24; Douglass v. Reynolds, 7 Peters, 113; Hatch v. Hobbs, 12 Gray, 447 ; Melemby v. McKee, 13 N. Y. 232; Rindge v. Judson, 24 id. 64; Grant v. Ridgedale, 2 Har. & J., 186; Mason v. Prichard, 12 East, 227; Rapalye v. Bailey, 5 Conn. 149 ; Hargrave v. Smee, 6 Bing. 244; Martin v. Wright, 6 Adolph. & E., 917; Critenden v. Fiske et al., 46 Mich. 70, and other cases. It can not be said that the cases are entirely harmonious as to the principles which govern in the construction of this class of instruments. But the weight of authority seems to be in favor of construing them by rules at least as favorable to the creditor as those applied to other written contracts, notwithstanding the guarantor is, in a sense, to be regarded as a surety. In Mason v. Prichard, supra, it is held, that the words are to be taken as strongly against the party giving the guaranty as the sense of them will admit. The same general principle is held, more or less directly, in Drummond v. Prestmond, 12 Wheat. 515; Douglass v. Reynolds, supra; Lawrence v. McCalmont, 2 How. 426; Bell v. Bruin, 1 How. 69; Dobbins v. Bradley, 17 Wend. 422; Mayer v. Isaacs, 6 Mees. & Welsb. 605. Taking the language of this instrument, and construing it in the light of the circumstances surrounding, it seems clear that it was intended that Mrs. Zuckerman should have credit with the plaintiffs, and that appellants would be liable for any balance that might remain unpaid at maturity at any time during the continuance of the guaranty. That is, that it was intended to give her credit with the plaintiffs to the amount of $1,500, until the guaranty should be revoked. We are of opinion, that the previous condition of her account with the plaintiffs in no wise affected the liability of the guarantors for any sum owing by Mrs. Zuckerman, from which they had not been discharged by the failure of the plaintiffs to give notice, within a reasonable, time, of non-payment. It' will, however, be observed that the contract of the guarantors is, that Mrs. Zuckerman would pay promptly “at maturity” any indebtedness, etc. Counsel for appellees show conclusively, that at'least $578.18 of the indebtedness of Mrs. Zuckerman was not due until after the 15th day of December, 1887. After giving the items of sales of goods by plaintiffs to Mrs. Zuckerman, from the 15th to the 23d of November, counsel say: “The earliest of these sales was made on November 15th, and, therefore, the credit on the same did not expire until December 15th, and those following became due at á correspondingly later period.” It was conceded, and is shown by the record, the amount sold on each day was treated as a separate transaction, and the indebtedness for the day’s sales would mature at the end of the credit given. That is, the credit being thirty days, the indebtedness contracted on the 15th of November would become due December 15th, and that contracted on subsequent days at corresponding dates in December. The same is true of the goods purchased on the 9th, 10th, 11th, 12th and 14th days of November, as shown by the record, and amounting-in the aggregate to several hundred dollars. It is iapparent, therefore, that on December 9, 1887, these several amounts had not matured, and the liability of appellants, for their prompt payment at maturity, had not attached. Counsel for appellees are correct in their contention that the record shows that these goods were mainly, at least, sold upon thirty days’ time, and there is nothing shown by which the credit could, at the option of the plaintiffs, be shortened. This suit was brought December 9, 1887, and it is clear that the liability of the guarantors in respect of such sales had not attached. If suit had been brought against Mrs. Zuckerman at that time, a complete defense as to these items of indebtedness would have existed, because they had not matured at the time the suit was brought. The indebtedness not having matured, there was no liability upon the guaranty therefor. A casual examination of the accounts will show, that if reasonable time of giving notice of non-payment be allowed, and for this purpose the accounts maturing on and before the 18th of November only be excluded because of failure to give notice of non-payment, it will be found that much less than $1,500 of the indebtedness of Mrs. Zuckerman to the plaintiffs had matured on the 9th of December, 1887. It can not be presumed that there was included in the judgment, which was for the full amount of the guaranty, indebtedness not matured, and it is, therefore, clear that the instruction complained of must have led the jury into the error of taking into consideration, in determining the amount for which appellants were liable, the indebtedness of Mrs. Zuckerman that had matured before the 18th of November, and in respect of which appellants’ liability as guarantors had been discharged. What will be reasonable time in which to give notice, must depend upon the circumstances in each particular case (Dickerson v. Dickerson, 39 Ill. 574; 2 Par. on Con., 174), and while it is not necessary to. determine the question, it would seem, from the facts here shown, that five days’ time would at least be reasonable within which to give notice of non-payment. Other errors are assigned, which will undoubtedly be corrected upon another trial, and need not be considered. We are of opinion that the judgment heretofore entered, reversing the judgments of the Appellate and Circuit Courts, and remanding the cause, was correct, and the same judgment will be again entered. Judgment reversed.