George D. Witt Shoe Co. v. Peacock

Connor, J., after stating the case: Tbe sole question presented by plaintiff’s exception is whether the $647.50 received by Mr. Raper shall be applied to the obligation of defendant Fuller in reduction of bis liability for $1,000, the amount of the bond. Plaintiff insists tbat Peacock bad the right to apply the $647.50 to the payment, pro raía, of all of the debts against him in the bands of Raper for collection, including those received subsequent to the execution of the bond. Applied in this way to the total amount of the debts, $1,816, there remains due on them $1,181.81, for which, to the extent of $1,000, plaintiff insists, defendant Puller is still liable. Tbe obligatory words of the bond, “promise to pay,” are explained by the last clause, “This note is executed for the purpose of securing and guaranteeing the payment,” etc. Tbe obligation, therefore, assumed by Puller is to secure and guarantee the payment by Peacock of $1,000, “which money, when received by Raper, to be applied to the payment of all claims be bas now in bis bands for collection against the said J. L. P'eacock, and to such others as be may receive for collection, until the full amount is applied.” It is evident tbat the words “full amount” refer ’to the claims then in Mr. Raper’s bands and such others as be might receive for collection. Thus Puller’s liability is expressly restricted to $1,000, and the guarantee is, by the last words of the note, limited to “the payment of the claims to the extent of -$1,000.” It was immaterial to Puller wbat amount of claims came into *548 Raper’s bands for collection subsequent to the execution of the bond. Tbis was doubtless uncertain. Tbe evident meaning of the language is tbat Fuller guaranteed tbat Peacock would pay on all of the claims against bim in Raper’s bands so mucb as $1,000, and tbat, when paid or “received by bim,” it was to be applied to sucb claims. When, therefore, the $647.50 was paid by Peacock, bis express agreement tbat it should be applied, pro rata, to all of the claims bad no other effect than to comply with the terms of bis bond. Tie could' not change or enlarge Fuller’s liability. If the payment be applied, as contended for by plaintiff, Peacock could impose upon Fuller the obligation to pay the full amount of .the bond, disregarding the express provision tbat the money, “when received,” should be applied to the debts until the full amount is applied. In other words, Peacock may have paid the whole amount for which Fuller was liable, and yet 'leave bim liable for the balance of bis indebtedness to the extent of one thousand, dollars. Tbis would do violence to the language and evident purpose of the parties when the bond was executed. It is an elementary rule of interpretation tbat where there is no repugnancy every part of an instrument must be given effect. It is also well settled tbat the liability of a guarantor or surety is not to be enlarged by construction. TIis obligation is to be fixed by the language of bis bond and not carried beyond its terms. It is strictissimi juris. No question of the right of the debtor to make sucb application of a payment by bim from bis general -funds, as be wishes, is presented in tbis appeal. It was a matter of no concern with Fuller bow the $647.50 was applied as between the creditors of Peacock. His right, under the terms of bis contract, was to have it applied to the reduction of bis guaranty. We concur with bis Honor in the instruction given the jury. There is No Error.