Court Opinion

ID: 6634081
Source: CourtListenerOpinion
Date Created: 2022-07-20 20:39:02.895253+00
Date Added: 2024-06-11T15:59:01.676356
License: Public Domain

Campbell J.
Oorkins sued Collins on a verbal promise to pay a bill for board and money lent, due from one James Sykes. The consideration was the release of certain trunks supposed to be held for the debt. ' The defence was the statute of frauds. IJpon the testimony the court directed the jury to find for defendant.
There was no testimony tending in our opinion to show an extinguishment of the liability of Sykes, and the property was released for his sole benefit. If Oorkins had a lien upon it, the only question to be decided is whether a promise to pay the debt of another is exempted from the operation of the statute requiring such promises to be in writing, by the release of property to the original debtor.
Such a release of a valid lien or claim would be a sufficient consideration for a written promise, for if a consideration passes from the promisee it usually makes no difference to whom it passes. But the question before us is whether a party who promises to pay the debt of the person who first owed and still owes it, for a consideration passing to that person, is to be regarded as promising to *482pay on his own behalf or on the original debtor’s behalf. If the debt is payable on his own behalf the promise may be' verbal. If not, then it must be in writing.
It is not pretended that an extension of time, or any other agreement involving no release of property or extinguishment of liability, if made in favor of the principal debtor, would authorize the verbal promise of a third person to pay the debt to be enforced., But a distinction is sought to be drawn where property is released or given up to the debtor. There is no obvious reason for any such distinction. The law puts all valuable considerations on the same footing. In every valuable consideration there is a gain on one side or 'a loss on the other, and usually these coincide, but the law does not vary the nature or validity of the contract by the character of the commodity or service gained or lost. Nor can we see how the position of a surety is changed by the kind of benefit resulting to his principal. The surety is no richer when his principal receives chattels than when he obtains any other advantage, and it seems absurd to hold that the contract is any more on his own behalf in the one case than in the other.
When, by the release of property from a lien, the party promising to pay the debt is enabled to apply it to his own benefit, so that the' release enures to his own advantage, it is quite easy to see that a promise to pay the debt in order to obtain the release may be properly regarded as made on his own behalf, and not on behalf of the original debtor, and any possible advantage to the latter is merely incidental and is not the thing bargained for. That promise is, therefore, in no proper sense a promise to answer for anything but the promisor’s own responsibility, and need not be in writing. So when a person sells a claim and guarantees its payment, the guaranty is collateral to his own contract, and is not intended for the debtor’s advantage.
But where the entire transaction, both promise and consideration, is intended and operates exclusively for the *483advantage and on behalf of the debtor whose debt is guaranteed, there seems to be no plausible ground for holding that the promise is anything but collateral, and if such a promise can in any case be valid without a writing, it must be valid in all. There is no tangible middle ground. Among valuable considerations there are no degrees of validity. They are all good or bad, but one valid one is as high in rank as another.
• We shall not attempt to elaborate a doctrine which is confined within such narrow limits. There are undoubtedly some cases where from the facts it may be hard to determine in whose behalf a promise is really made; but where this is clear, there seems to be no difficulty in determining whether it is original or collateral to the liability of another. The case of Mallory v. Gillet, 21 N. Y. 412, contains in the opinion delivered by Judge Gomstoclc so full and satisfactory a discussion of the whole subject, that it may be properly referred to as leaving nothing more to be said on such a case as the present.
The Circuit Judge was right in giving the instructions complained of.
It may be remarked that it is very doubtful whether the property released was subject to any lien whatever. A portion of the debt was for money lent, and we infer that the balance was due not for the accommodation of travelers in an inn, but for board to a person not standing as to Sykes in the privileged position of an inn-keeper. But no point was made on this at the hearing, and perhaps the facts, if depending on this alone, might not be decisive. We base our opinion, therefore, on the principal question discussed.
The judgment should be affirmed with costs.
Cooley Ch. J. and Graves J. concurred.
Christiancy J. did not sit.