Court Opinion

ID: 3661470
Source: CourtListenerOpinion
Date Created: 2016-07-06 06:12:52.065548+00
Date Added: 2024-06-11T13:39:10.722398
License: Public Domain

At the conclusion of the evidence, a motion of nonsuit was sustained. The plaintiff appealed.
The facts are sufficiently stated in the judgment of the Court by Mr.Justice Brown.
The plaintiff sued to recover $500 which the defendant procured from the plaintiff for the purpose of investing the same. The plaintiff claimed that the defendant promised to guarantee the investment at the time the money was placed in his hands at his request; that the defendant had the use and control of the money without any direction from the plaintiff, and that this formed a consideration which supported the guaranty.
The defendant claimed that the transaction, upon the plaintiff's own showing, was a promise to answer for the payment of the debt of another, and not being in writing, it comes within the statute of frauds and is void. His Honor being of opinion with the defendant, sustained the motion to nonsuit.
The plaintiff supports her alleged cause of action with a written guaranty contained in a letter of the defendant to the plaintiff, dated 8 November, 1906. The plaintiff testified that the defendant came to see her and told her that he heard that she had some money, and he desired to know if she wanted to lend it out, saying that he could invest it better out of the State, as then she would not have to pay taxes on it.
The plaintiff testified the defendant went to see her several times and each time endeavored to persuade her to let him invest the money. She at first refused, because she did not want it invested away from home. The last time the defendant came he said if she would let him have it, "he would guarantee it to be safe, and that she could look to him for the amount, and not to these other men."
It appears that upon the faith of that guaranty the plaintiff let the defendant have $500. The statements of the plaintiff are fortified *Page 454 
(555) and corroborated by the letter of 8 November, 1906. The defendant offered no evidence.
In our view his Honor erred in supposing that this transaction, if the evidence is taken to be true, presents the ordinary case of a promise to answer for the debt of another. At the time of this transaction there was no other debt contracted. The only contract that had been made was between the plaintiff and the defendant, and that contract is a guaranty, that is to say, an obligation of the guarantor, and separate and distinct from the obligation of a principal debtor. Carpenter v. Wall, 20 N.C. 144; Colemanv. Fuller, 105 N.C. 328; Tell on Guaranties, 1; Smith on Mercantile Law, 277.
We think that the fact that this money was placed in the hands of the defendant at his request, and that he was given absolute control over it upon the faith of his promise to guarantee its safety, is a sufficient consideration to support the contract; but we doubt if any consideration is necessary, for where the contract of guaranty is contemporaneous with the principal debt, no other consideration is necessary, because the contract is founded upon the consideration existing between the parties. It is otherwise if the guaranty be made afterwards without any new consideration.Green v. Thornton, 49 N.C. 231.
It appears further in the evidence that the defendant invested this money in a New Jersey concern without consultation with the plaintiff, who evidently relied entirely upon his guaranty, which concern was doing business in Raleigh and the defendant was its agent or representative.
If a consideration is necessary, the pecuniary interest of the defendant in the transaction is a sufficient consideration to support the guaranty.Whitehurst v. Hyman, 90 N.C. 487; Dale v. Lumber Co., 152 N.C. 651;Peele v. Powell, 156 N.C. 558; and Whitehurst v. Padgett, 157 N.C. 424.
We think his Honor erred in sustaining the motion to nonsuit.
Reversed.
(556)