Barges Cycle Co. v. Schofield

Little, J. 1. An instrument in the form of a contract between two parties, signed by one of them and by an agent of the other, with a clause reciting that “this contract shall not be considered as binding upon the first party until, approved in writing by” the second party, is only a proposal to contract, submitted by the party of the first part to the party of the second part. 2. When, before approval of the proposed contract by the latter, a third person for a valid consideration paid by the party of the first part enters in writing upon such proposal a stipulation that he will “guarantee all sums owing or which may hereafter be owing [by the party of the.first part] during the term of this contract,” etc., such endorsement amounts only to a proposal of guaranty, and does not takeAffect until the original paper becomes a binding contract between the parties of the first and second part by the contemplated approval in writing. Being a proposal [881] to guarantee performance by the party of the first part when the contract becomes binding, the guarantor is entitled to notice of its acceptance by the party of the second part before he is bound by the terms which it sets forth. Sanders v. Etcherson, 36 Ga. 409 ; Claflin v. Briant, 58 Ga. 414; Brandt on Suretyship, §§189-193; Clark on Contracts, 29. Argued July 19, — Decided August 9, 1900. Complaint. Before Judge Nottingham. City court of Macon. September term, 1899. J. R. L. Smith, for plaintiff. Estes & Jones, for defendant. 3. The record not disclosing that any proper notice of acceptance by the party of the second part was given to the guarantor, there was no error in any of the rulings made by the trial judge, nor in the direction of a verdict in favor of the guarantor. Judgment affirmed. All the Justices concurring.