Court Opinion

ID: 5501521
Source: CourtListenerOpinion
Date Created: 2022-01-10 03:00:23.201489+00
Date Added: 2024-06-11T08:33:56.775724
License: Public Domain

Merwin, J.
Ho exceptions to the decision of the court were filed by the appellant, and the respondent therefore claims that the appellant is not in a position to question the correctness of the decision. The cases cited to sus*238:tain this view of the practice relate only to trials of issues of fact. By section 992 of the Code of Civil Procedure it is provided that “an exception may be taken to the ruling of the court or of a referee upon a question of law arising upon the trial of an issue of fact.” The manner in which such exceptions shall be taken is regulated by sections 994 and 995. We are referred to no provision of the Code, or to any authority, which requires exceptions to be taken to the decision of the court on the trial of an issue of law. Under the former Code, the practice, as understood, did not require exceptions in -such a case. 3 Wait, Pr. 232. We think none were necessary.
Upon the merits of the demurrer, the claim of the respondent, as indicated by his points, is that he is not liable until a demand is made upon the principal debtor, and that “it must be shown that she refused to fulfill the cove-' nants, and the surety must have previous notice, and a demand must also be made on him, so that he may have knowledge of the breach, and an opportunity to fulfill himself.” To sustain this view the cases of McMurray v. Noyes, 72, N. Y. 523; Toles v. Adee, 91 N. Y. 562; Bank, v. Livingston, 2 Johns. Cas. 409; Insurance Co. v. Ogden, 1 Wend. 187,—are cited. In the 'McMurray Case the defendant, upon an assignment of a bond and mortgage, •covenanted that if, in case of foreclosure and sale of the mortgaged premises, there should arise a deficiency, he would pay the same on demand. In an action on this guaranty it was held that the foreclosure and sale were conditions precedent, to be performed with due diligence in order to establish the ■liability of the guarantor. Toles v. Adee was an action upon an-undertaking given upon the discharge of a defendant from an order of arrest, and condiiioned that the party discharged would at all times hold himself amenable to process issued to enforce the judgment. It was held that the entry of judgment and issuing.of process against the principal debtor were conditions precedent to the liability of the surety, and that a neglect to perform such conditions with due diligence discharged the surety. In Bank v. Livingston there"was an absolute guaranty of repayment of certain moneys advanced to a committee. The only question raised was whether the committee should have been first sued, and it was held that this was not necessary. In Insurance Co. v. Ogden the defendant had assigned to plaintiff certain contracts, and covenanted that the sum set opposite to each contract in a statement annexed was then justly due " -thereon, and that “ each and every sum should be well and truly paid to the plaintiffs, with the interest on each respectively. ” It was held that plaintiffs could not call on defendant for payment without first making demand of those who > signed the contracts, but that it was not necessary to bring suit against them. The first two cases are clearly distinguishable from the present. In those •something was to be done by the creditor before the liability of the surety was determined. Here the liability attached and was determined the moment -the lessee failed to perform his duty, and the liability of the surety was as extensive as that of the lessee. Poth. Obi. 404. The ea.se in 1 Wend, sustains somewhat the position of defendant, but other cases are in a different direction. In Allen v. Rightmere, 20 Johns. 365, there was a guaranty by the defendant of the payment of a note, and it'was held not to be necessary .to make a demand of the maker before suing the defendant; it being said that the undertaking of the defendant was that the maker should pay the note when due, or that the defendant would pay it himself. The doctrine of ■this case was followed and established by the court of appeals in Brown v. Curtiss, 2 N. Y. 225. In Mann v. Eckford’s Ex'rs, 15 Wend. 502, the .obligation sued on was a bond of defendant’s testator, conditioned that one Gib- • bons “should punctually'satisfy and pay to the .¿Etna Insurance Company” the amount of a certain bond and mortgage executed by Gibbons, and upon which the company had advanced the money, with interest as the same should become due. It was held not to be necessary for the plaintiff to prove a dean and upon Gibbons for payment of the money and notice to thp obligor or to *239• defendants, it being said that, if a person make an unconditional engagement for the act of a third person, the contract will be broken if that person fails to do the act. In Douglass v. Howland, 24 Wend. 35, there was an agreement between plaintiff and one Bingham, whereby, among other things, Bingham agreed to pay the plaintiff such sum as should be found due upon • an accounting provided for in the agreement. Underneath the agreement the defendant executed an instrument, by which he covenanted that Bingham should “well and faithfully perform on his part the above agreement.” It was held that defendant was not entitled to notice, before action, of Bingham’s default. Among other cases there cited was the case of Brookbank v. Taylor, Cro. Jac. 685, where the promise was that the defendant would pay the plaintiff the rent due from another, if the latter did not pay it, • and it was held that the defendant must notice the non-payment at his peril. In Bank v. Rogers, 7 Bosw. 493, the plaintiff made a loan to one Chase, payable in 60 days, and the defendant promised that, if Chase failed to repay the . amount, with interest, within 60 days, “then and in such case the defendant will become answerable to the plaintiffs for such repayment after 30 days’ no-tice of such default.” It was held that a demand of the principal need not be made before suit against the defendant. In Clark v. Burdett, 2 Hall, 217, there was a guaranty by defendant of payment of bills of merchandise purchased or to be purchased, and it was held that a demand of the purchaser and notice to defendant were not necessary as conditions precedent to the plaintiff’s right of action. In Turnure v. Hohenthal, 36 N. Y. Super. Ct. 79, where a surety to a lease bound himself that, in ease default should . at any time be made by his principal in payment of rent and in the performance ■ of the conditions of the lease to be by him performed, he would pay the rent in arrear, and all damages in consequence of the non-performance of the eov- • enants, without requiring any notice of such default, it was héld that no demand was necessary to be made of the tenant by the landlord for the rent before proceeding against the surety, and that the landlord was under no obligation to attempt to collect the rent or enforce the covenants against the ■ tenant. A like view was taken in MoKensie v. Farrell, 4 Bosw. 204, and in Ducker v. Rapp, 41 N. Y. Super. Ct. 235. In Cordier v. Thompson, 8 Daly, 172, one Perrero executed an instrument by which she agreed to re- ■ turn to plaintiff’s intestate a certain amount of money at a certain time, and the obligation of the defendant was in the following form: “I guaranty the above obligation.” This was held to be a guaranty of payment, and that neither demand on the principal nor notice to the guarantor of default were prerequisite to an action on the guaranty. Voltz v. Harris, 40 Ill. 155, was - an action upon a guaranty of a lease, by which the guarantor became “security” that the lessee would do and perform all the covenants contained in the lease, and promised to pay to the lessors all rents and damages the lessors might ■ sustain by reason of the non-compliance with or non-fulfillment of the stipulations of the lease by the lessee. It was held that the liability of the guaran- ■ tor was primary, and that he was not entitled to notice of the non-perform-once of the stipulations. In Ashton v. Bayard, 71 Pa. St. 139, the obligation .against the surety was: “I hereby become the security of S. Coulter for the fulfillment of the'within obligation.” This referred to a due-bill given by Coulter for certain shares of stock. This was held to he an original un- ■ dertaking by the surety, and a recovery thereon could be had without proving diligence to pursue Coulter. See, also Brandt, Sur. §§ 86, 172. In the present case, as against the lessee, no demand was necessary. Jackson v. Binns, 10 Wkly. Dig. 105; McMurphy v. Minot, 4 N. H. 251. His agreement” was broken when he failed to pay, and when he violated the conditions ■ of the lease. The defendant agreed to fulfill all the terms and conditions not fulfilled by the tenant. This was, in effect, an agreement to pay if the lessee ■ did not. When the plaintiff shows a breach by the lessee, and non-payment *240or non-fulfillment, then he shows all that by the terms of the contract he is required to show in order to make the defendant liable. The agreement of defendant was not that the lessee would pay on demand or upon suit brought, but it was absolute that he would fulfill if the lessee did not. This, in substance, was a guaranty of payment, and not of collection. The defendant, in ' his agreement, required no demand or notice or exhaustion, of remedies against the tenant. No duty was imposed on the lessor in the first instance to take any steps against the debtor, and that is said to be the test in order to examine whether a guaranty of payment or collection exists. Toles v. Adee, supra, 573. The contracts of sureties are to be construed like other contracts, so as to give effect to the intention of the parties. People v. Backus, 117 N. Y. 201, 22 N. E. Rep. 759. It is hardly to be assumed here, in the absence of an express stipulation to that effect, that the intention of the parties was that the lessor should pursue the lessee to the end of an execution before calling upon the surety. In fact, that does not now seem to be claimed by the respondent’s counsel, but he relies on the question of demand and notice. This the defendant did not require by his agreement, and he was not entitled to it, any more than in case of an absolute guaranty of payment. This view is, I think, in accordance with the current of authority, as illustrated by the cases above referred to. It follows that the demurrer should have been sustained. Judgment and order reversed, with costs of appeal, and interlocutory judgment ordered for the plaintiff upon the demurrer, with costs, with leave to the defendant to answer in 20 days upon the payment of' the costs of the demurrer and of the appeal. All concur.