Court Opinion

ID: 3610577
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:54:50.980309+00
Date Added: 2024-06-11T13:58:09.760191
License: Public Domain

Although the complaint in this case avers that the guaranty was executed at the same time with the principal contract, yet if it appear from the complaint itself that the averment is one which could not by possibility be supported upon a trial, the plaintiff cannot avail himself of it upon demurrer. The contract and guaranty are both set forth. If from these it appears, either expressly or by inference, that they were executed at the same time, or if the plaintiff could be permitted upon a trial to prove their simultaneous execution by parol, the averment is available to the plaintiff; otherwise not. It becomes necessary, therefore, to consider these questions.
The guaranty is written at the foot of the contract, upon the same paper; the principal contract being dated, but the guaranty without any separate date. Under these circumstances a presumption may arise, in the absence of all proof to the contrary, that the contract and guaranty were both executed at the *Page 333 
same time, especially where, as in this case, the consideration of the principal contract is executory: but I will not dwell upon this point, as I entertain no doubt, that it would be entirely competent for the plaintiff, upon a trial, to prove by parol that the papers were simultaneously executed. Whenever the time of the execution of any writing, even of the most solemn kind, becomes material, it may be proved by parol; not merely to supply an omission, where the paper itself is without date, but in opposition to the date, where it contains one. The time when a contract is executed is no more a part of the contract than the place where it is executed. Both belong to that class of attending and surrounding circumstances which may always be resorted to for assistance in explaining and applying the terms of the contract.
This rule applies to contracts required by the statute of frauds to be in writing, no less than to all other contracts. That statute abrogates none of the rules of the common law, except such as are necessarily in conflict with it. Judge COWEN, speaking on this subject, in Douglass v. Howland (24 Wend.,
35), says: "Some of the most difficult cases on the rule respecting the ambiguitas latens of written contracts, have arisen on these guarantees. You are to see what they mean in such cases, by looking to collateral facts or surrounding circumstances. You do this in order to sustain the most solemn contracts, such as deeds or wills."
Many other authorities might be cited to the same effect, but it is unnecessary, as I deem the point too plain to admit of serious question.
There is no doubt that the principal contract in this case expresses the consideration with sufficient clearness; and we are to assume upon this demurrer that the guaranty was executed at the same time with it. The case presents, therefore, in the most unmixed form, the question whether, under such circumstances, the consideration expressed in the principal contract can be read as a part of the contract of guaranty, so as to remove the objection arising under the statute of frauds, which requires not only that the guaranty should be in *Page 334 
writing, but that the writing should express the consideration of such guaranty. (2 R.S., 135, § 2.)
There have been several decisions of this court since its organization which bear upon this question; and it will scarcely be necessary to go beyond these decisions in considering the present case. The plaintiff's counsel, to maintain that the guaranty does express the consideration, insists in his printed points that the principal contract and the guaranty, having been executed at the same time, to the same party, and in relation to the same subject matter, should "be deemed to have been parts of the same transaction;" and that "the two instruments may be read together as one contract."
The rule here invoked is a familiar one; but three things are essential to its application, viz: The contracts must be executed at the same time, they must relate to the same matter and must be between the same parties. It is by no means sufficient, as the counsel has assumed, that they should be executed to the same party. A single familiar illustration will sufficiently test this, and show the importance of the distinction. Suppose two insurance companies were to execute separate policies at the same time, upon the same property, and to the same person, it would scarcely be claimed that the two could be read together as one contract; and yet the case would embrace every element which the counsel, as it would seem from his point, deems essential to that result. The two contracts would be executed at the same time, to the same party, and in relation to the same subject matter.
In the present case, Hazewell, the principal, and Snow, the guarantor, have both made contracts with the plaintiff, at the same time, and relating to the same subject; but Snow is not a party to Hazewell's contract, nor Hazewell to that of Snow; nor are the two contracts identical in substance. Hazewell agrees to purchase certain stocks, and that he himself will pay. Snow agrees neither to purchase nor pay, but that Hazewell shall do both. Hazewell is liable primarily; Snow only in case of his default. The contracts, therefore, are plainly separate and distinct, and cannot be read together as one. To a certain *Page 335 
extent, no doubt, the principal contract may be read in connection with and as a part of the guaranty. The latter impliedly refers to the former, for a statement of what the guarantor undertakes that the principal shall do. But this implication clearly does not extend to the consideration. That may be the same, or it may be other and different. There can be no presumption in this case that it is the same; and even if there could, that would not satisfy the statute, which requires the consideration to be expressed in the guaranty.
The plaintiff's counsel relies mainly upon the case of UnionBank v. Coster's Executors (3 Comst., 204), to support his position. But the decision in that case, does not necessarily rest, and cannot, I think, be sustained, upon the doctrine that different instruments made at the same time, in respect to the same matter, are to be read and construed together; because there as here, one essential circumstance was wanting, viz.: an identity of parties. The primary contract in that case and in this, are very much alike in respect to the consideration, which is executory in both. But the guarantees are very different. In the case of Coster it was as follows: "I hereby guaranty the due acceptance and payment of any draft, issued in pursuance of theabove credit."
It would be difficult to make two guarantees more unlike in frame and structure than the two under consideration. The guaranty in the present case is entirely silent as to the things guaranteed to be done; that in the Coster case contains a pretty full recital of what is guaranteed. Again, the former contains no reference, express or implied, to the consideration of the original contract, or to a consideration of any sort, while the latter may be construed as expressly referring to the consideration of the principal contract. The words, "in pursuance of the above credit," upon one construction, it is true, might be said to be merely descriptive of the paper guaranteed. But they may, when taken in connection with the form of the instrument and the attending circumstances, be held to mean something more. What is the "above credit" referred to? It is not for all drafts drawn by Kohn, Daron  Co., but such only as should *Page 336 
be "negotiated through," that is, taken and discounted by the persons to whom the instrument is addressed. The paper is in the form of a letter, which is to be regarded as addressed to the plaintiff. The presumption is, from the form of the instrument, and the nature of the transaction, that there had been no negotiation between the plaintiff and the guarantor, before the presentment of the letter to the plaintiff. The guaranty was obviously made with a view to such presentment. Does it not then in effect say to the plaintiff, that any drafts drawn as described, which it will consent to take, shall be duly accepted and paid, thus referring to and adopting the consideration of the original contract, viz., the taking and discounting of the drafts, as the consideration of the guaranty? There is an obvious distinction between the principal contracts in the two cases, which materially affect the construction of the guarantees. In the present case, the instrument is a mere embodiment in writing, of what had been previously agreed upon between the parties. Its language is: "I have purchased," c. There could be no purchase without a sale; and hence, the plaintiff must have agreed to sell the stock to Hazewell before the guaranty was executed; and for aught that appears, before any agreement to execute it. In the case of Coster, on the other hand, it is manifest from the nature of the transaction, that the original credit must have been given after the execution and presentment of the guarantee, and presumptively in reliance upon it; and hence, that the consideration of the guaranty was identical with that of the principal contract.
There is, in the present case, by no means the same ground for a presumption, if that could make any difference, that the credit was originally given upon the faith of the guaranty, and that this credit was contemplated as the consideration of such guaranty, as in the case of Coster's Executors. The plaintiff cannot avail himself of the averment to that effect in the complaint; because, as we have seen, it cannot be inferred from the face of the guaranty, taken in connection with the circumstance that it was executed at the same time with the primary contract; and there is therefore no way in which the fact could *Page 337 
be made to appear upon a trial, as it clearly could not be proved by parol. For all these reasons, the difference between the two cases is marked and clear.
The case of Coster's Executors, in the view which has been taken of it here, is not at all in conflict with the case ofBrewster v. Silence (4 Seld., 207), in which the very question now presented was decided by a nearly unanimous vote, in opposition to the views maintained by the plaintiff's counsel here. There may be reason to apprehend that the rule adopted in the latter case will in its practical operation be productive of some inconvenience; as it will not be easy to impress upon the community at large the necessity of observing that rule in their ordinary transactions. It was probably some consideration of this sort which led the late Supreme Court of this State to go to the extraordinary length of holding that one who guarantied the payment of a promissory note was liable as a maker of the note thus guarantied. (Manrow v. Durham, 3 Hill, 584; Luqueer
v. Prosser, 4 id., 420.)
But these cases, which, as has been justly said, stand upon no basis of principle, have been repeatedly overruled, and especially in the case of Brewster v. Silence (supra). The plaintiff's counsel assumes that the case of Brewster v.Silence was decided solely upon the authority of that of Hall
v. Farmer (2 Comst., 553), which, as he insists, settled no principle. It is true that in the case of Hall v. Farmer
there was no authoritative decision of the court; the judgment having been affirmed by force of the statute alone, upon the third argument, for want of a concurrence by any five of the judges as to the judgment to be pronounced. But the decision in the case of Brewster v. Silence, was not based upon that case alone, but upon a process of reasoning to which I have not been able to discover any satisfactory answer. WILLARD, J., by whom the opinion of the court was delivered, says: "The note and guaranty are not one and the same thing. The note is the debt of the maker. The guaranty is the engagement of the defendant that the maker shall pay the note when it becomes due. A joint action will not lie against them both. They *Page 338 
are not the same but different and distinct contracts. If we give effect to the statute, we must treat the guaranty as void, for want of expressing on its face the consideration." Although it expressly appeared in that case that the consideration of the note was the sale of a pair of horses, and that the giving of the guaranty was made a condition of the sale, I nevertheless fully concur in the decision, as facts of that description can have no influence upon the question, except where, as in the case ofCoster's Executors, they may have a bearing upon the construction to be put upon the terms of the guaranty. Neither the conclusion arrived at in this case, nor the decision in the case of Brewster v. Silence, is necessarily in conflict with any of the previous cases decided by this court. The case ofBrown v. Curtis (2 Comst., 225), was put upon the ground, not that the statute had been complied with, but that the contract did not come within the provisions of the statute, and need not have been in writing at all.
The judgment of the Superior Court, therefore, should be affirmed.
All the judges concurred except STRONG, J.