Baskett Lbr. & Mfg. Co. v. Gravlee

BROWN, J. — It is conceded that the relation of appellant to the transaction out of which this litigation arises is that of guarantor. The point in controversy between the parties is as to when appellant’s liability became fixed, if at all. One of appellant’s contentions is that liability under the guaranty is not fixed short of the exhaustion of all legal remedies against the principal, and another is that appellant was entitled to reasonable notice of the default of the principal. On the other hand, appellee contends that the guaranty is absolute and appellant’s liability became fixed upon default of the principal, without; more. (1) It is well settled that where the guaranty is absolute in terms and for the performance of a specific act at a fixed period, liability of the guarantor becomes fixed on default of the principal; and the guarantor must inquire of his principal, or take notice of his default at his peril, unless notice is stipulated for in the contract of guaranty. — Donley v. Camp, 22 Ala. 659, 58 Am. Dec. 274; Leftkovitz v. First National Bank of Gadsden, 152 Ala. 521, 44 South. 61. (2) The nature of the obligation of the guarantor is affected by the character of the principal contract, to which the guaranty relates; and, if the principal contract expresses an absolute obligation to pay a definite sum at the specified date of maturity or before, a guaranty of the payment of such contract imports an undertaking without condition to perform the contract in the event it is not performed by the principal. — Hung erford v. O’Brien, 38 Minn. 306, 34 N. W. 167; Sterne’s Law of Suretyship, §§ 67, 68. Where, however, as in this case, the obligation is in the nature of a continuing guaranty and the amount to be paid is not fixed and definite, but is dependent upon contingencies not scheduled to happen at a definite .time, and the guarantee has better opportunity than the guarantor to know of the default, and under the terms of the guaranty the guarantor may perform the principal contract and avert loss or minimize damages, and the time within which performance may occur is limited by the principal contract, natural justice, it seems, would dictate that the guarantor have reasonable notice of the principal’s default; and this is especially true if, under the terms of the principal contract, the guarantee is given the option to terminate the right *364 of the parties to perform upon the happening of certain contin gencies. — Walker v. Forbes, 25 Ala. 139, 60 Am. Dec. 498; Sterne’s Law of Suretyship, § 68. (3) Unless notice is stipulated for in the contract, the giving of notice is not essential to the plaintiff’s case. It is defensive matter, and forms the basis for the guarantor to show that he has suffered damage by the plaintiff’s failure to give notice, which he may recoup against the damage suffered by the guarantee.— Walker v. Forbes, supra; Martyn v. Lamar, 75 Iowa 235, 39 N. W. 285; Bank v. Gaylord, 34 Iowa 246; Sterne’s Law of Suretyship, supra. (4) The guaranty of the appellant was not of the collectibility of the demand, nor of his ability to pay damages for nonperformance, but was an absolute obligation to perform the contract by cutting the timber, and paying for it, in the event the principal, Daniel, failed to cut and remove the timber and pay for it; and it was not essential to plaintiff’s right of recovery that he exhaust legal remedies against the principal, or show his insolvency. The guarantor’s liability became absolute on default of the principal. — Authorities supra, and also Rawleigh Medical Co. v. Tarpley, 5 Ala. App. 412, 59 South. 512; Watkins Med. Co. v. Lovelady, 186 Ala. 414, 65 South. 52. (5) The consideration of the contract between the plaintiff and the defendant, as expressed in the contract, was the agreement of plaintiff that the defendant should have, “the necessary rights of way for spur tracks, tramroads, and wagon roads, and necessary ingress and egress over the lands of the said C. M. Gravlee and G. W. Gravlee for the purpose of cutting and removing the said timber,” and was sufficient to take it out of the statute of frauds. — Flowers v. Steiner, 108 Ala. 440, 19 South. 321; Turner v. Smith, 112 Ala. 334, 20 South. 486. (6) The contract between the plaintiffs and Daniel is in substance and form a conveyance, executed and acknowledged as such, and upon its delivery the legal title to the timber described therein passed to Daniel. — Zimmerman Mfg. Co. v. Daffin, 149 Ala. 380, 42 South. 858, 9 L. R. A. (N. S.) 663, 123 Am. St. Rep. 58; Wright v. Bentley Lumber Co., 186 Ala. 616, 65 South. 353; Vizard v. Robinson, 181 Ala. 349, 61 South. 959; Mt. Vernon Lumber Co. v. Shepard, 180 Ala. 148, 60 South. 825; s. c., 190 Ala. 570, 67 South. 286. *365 (7) This title, however, was incumbered .by the two conditions subsequently expressed therein: “In the event the said J. P. Daniel shall fail or refuse to be governed by the ruling of the referees so selected, his failure so to do shall work a forfeiture of this conveyance,” and “in the event any logs are removed by the said J. P. Daniel without being scaled, same shall work a forfeiture of this instrument.” These conditions, even if they had been breached, did not render the conveyance void, but merely voidable by acts of the grantors inconsistent with the continuance of the estate. — 13. Cyc. 711, V, E, 6, d (11). (8) A forfeiture not having been claimed, by filing this suit to recover the price of the uncut timber as fixed in the conceyance, such conduct being inconsistent with the right to claim a forfeiture, the grantors waived these conditions. — 13 Cyc. 707, V, E, 5, c. (9) The price as fixed in the conveyance for pine timber is $2, and for gum, oak, poplar, and hickory, $3 per thousand feet “Doyle rule (measuring small way).” These provisions of the contract are sufficiently definite to enable the court to estimate the damages flowing from the breach. The plaintiff was entitled to recover the price of the timber as fixed by this conveyance. This distinguishes this case from those cited by appellant, in which the plaintiff sought to recover unearned profits. — Christie, Lowe & Heyworth v. Patton, 148 Ala. 326, 42 South. 614. The execution and delivery of the conveyance operated to vest the legal title to the timber in Daniel, the grantee, thus fulfilling on the part of the plaintiff’s all obligation precedent to their right to insist upon full performance on the part of Daniel, and there was nothing left for them to do except receive payment, when tendered. (10, 11) The original complaint sets out both the conveyance and the contract of guaranty in hsec verba, and the complaint as amended avers that Daniel failed to cut certain specified quantities of timber falling within the specifications of the contract, and that he had abandoned the cutting of the timber; and also that the defendant has failed to take up the timber cut or to be cut by Daniel. These averments show a breach of the contract; and while, as insisted by appellant, the complaint may have been subject to demurrer because it does not aver that all of the timber covered by the conveyance had not been paid for, this question is *366 not presented by the demurrers found in the record. — Code 1907, § 5340. (12) The defendant’s several pleas, to which demurrers were 'interposed and sustained, stated mere conclusions, and the ruling ■of the court as to these pleas is free from error. (13) The question propounded to the witness Harris, and to which objections were made, pertained to the character and quality of timber not cut by Daniel, and called for relevant testimony, .and the objections were properly overruled. ((14) It was incumbent upon the plaintiff to show that the timber left was sound, free from windshakes, doughty spots, and other defects that would reduce the grade below grade 2; but it was within the discretion of the court to allow questions not hypothesizing these facts. (15) The fact that Daniel had cut timber from this or other lands under contracts previous to the one here involved does not appear to be material, for the reason that there is no claim here for timber cut and removed; but the claim is limited to timber covered by the contract not cut, or cut and not removed. (16, 17) The contract is the sole evidence of the intention of the parties, construed in the light of the surrounding circumstances ; and it was the province of the court, and not the witness, to interpret this contract (9 Cyc. 577) ; and it was not permissible for the witness Daniel to state his undisclosed or secret intention. — Fuller v. Whitlock, 99 Ala. 411, 13 South. 80; 9 Cyc. 578. (18) The witness Gravlee, after the court had sustained objections to questions eliciting testimony as to what occurred between witness and Mitchum, seems to have testifiel fully on this subject without objection, and the ruling of the court, if error, was without injury. (19) Relying on Wheeler v. Cleveland, 170 Ala. 426, 54 South. 277, appellant insists that the measure of the plaintiffs’ ■damages, if they were entitled to recover, is the difference Between the market value of the timber at the time of the breach of the contract and the contract price. . There is a vast difference between the contract in that case and the one here involved. That was an executory contract, and the title to the timber in that case ■did not vest until it was measured at the places mentioned in the ■contract; while in this case the title vested in the grantee with the delivery of the conveyance, and plaintiffs were entitled to *367 recover the agreed purchase price of the timber. In Wheeler v. Clveland the contract was executory; in this case it was an executed contract. For this reason, charges 2, 3, and 4 were properly refused; and charges 5 and 6,- on principles heretofore stated,, were properly refused. (20) Charges 11 and 13, if otherwise correct, were abstract, there being no evidence that the lands were cut over “as closely as is the custom of prudent and economical lumbermen to clear the land,” or any evidence from which such or similar facts; could be inferred. The defendant’s contention was that all the timber within the specifications of the contract had been cut and removed. There are 92 assignments of error on the record, and we have considered all questions argued in brief; and, finding no reversible error, the judgment of the circuit court is affirmed. Affirmed.