Court Opinion

ID: 5213809
Source: CourtListenerOpinion
Date Created: 2022-01-06 16:18:31.639346+00
Date Added: 2024-06-11T08:27:24.519870
License: Public Domain

Houghton, J. (dissenting):
I dissent. The defendant, was a guarantor for a commission paid by plaintiffs of specified accounts which they held against Garzouzi Brothers. Payments on such accounts were overdue. In a conversation had between the plaintiffs and the defendant guarantor respecting the pressing of such accounts for collection by plaintiffs, the defendant told ‘ the plaintiffs that they could use their own judgment as to what to do. The testimony is: “ And he told me (one of the plaintiffs) at that time, finally that I could use my own judgment as to whether to sue or whether not to sue, or what to do with the matter.” ' The plaintiffs did not sue, and after certain pay*694ments liad been made took notes for the balance coming due at various times. Some of these notes were paid and some were not, ■and this action is brought for the balance of the account remaining unpaid.
Of course as a general proposition the taking of a negotiable note payable at a future day so extends the time of payment and suspends the right of collection that a guarantor is relieved. It seems to me, however, that where such unlimited authority was given as the jury was justified in finding was in fact given in the present case, the guarantor is precluded from saying that he was relieved because notes were taken. Clearly the defendant would not have been relieved from, his guaranty if the plaintiffs had extended the time of payment of the accounts beyond the period when the last note was due if they had not taken any notesat all. The authority given would have been sufficient to justify such extension of payment of the accounts themselves if any were needed. Ho injury by the taking of the notes is pretended. The appellant simply relies upon being released as matter of law, because they were so taken, lie denies giving the authority which the plaintiffs claimed he did, but the jury was entirely justified in saying that he had made such agreement. It is true the subject of the conversation in the beginning related to bringing suit, but upon the defendant’s attention being called to the disastrous consequences of such action upon the credit of the debtors, the defendant finally said to plaintiffs to use their own judgment in the matter of the accounts and their collection. Under the circumstances, in view of the admissions proved against defendant that he had given such authority and that he was' told of the taking of the notes and made no objection, I think the jury was justified in finding that the authority given was broad enough to permit the plaintiffs to manage the account as they saw ■ fit and as seemed to them best and to take notes if that seemed to be the best course and that such authority • was not confined to determining simply whether suit should be brought. Of ■ course mere knowledge of defendant that notes had been taken and lack of protest did not bind him, but that fact is a circumstance showing what the authority given in fact was. Authority given by a creditor to an agent to “ see ” his debtor in precarious circumstances ■ and to “ act” in the matter is sufficient to authorize him to take *695personal property in satisfaction, of the debt. (Oliver v. Sterling, 20 Ohio St. 391.)
So authority to compromise a tort for “ anything he could get ” justifies the taking of a .promissory note (Mitchell v. Finnell, 101 Cal. 614), and general authority to make and renew loans binds the pi’incipal although a note is taken which has the effect of releasing a guarantor (Hurd v. Marple, 10 Ill. App. 418), and authority to receive such sum as the creditor could pay binds the- principal where an order on a third party is accepted. (Ruthven Bros. v. Clarke, 109 Iowa, 25.)
I, therefore, vote for the affirmance of the judgment.
Judgment and order reversed, new trial ordered, costs to appellant to abide event.