McKibben v. Fourth National Bank

Bell, J. 1. The cardinal rule in the construction of contracts is to ascertain the intention of the parties. If that intention be clear, and it contravenes no rule of law, and sufficient words be used to arrive at the intention, it shall be enforced, irrespective of all technical or arbitrary rules of construction. Civil Code (1910), § 4266. As to whether a contract is one of suretyship or of guaranty, “as with other contracts, the whole matter is governed by the intention of the parties.” Baggs v. Funderburke, 11 Ga. App. 173, 174 (74 S. E. 937). The language which the parties have used will be looked to for the purpose of finding [223] that intention, which when it is once ascertained will prevail over all other considerations, in determining the nature of the agreement. Etheridge v. Rawleigh Co., 29 Ga. App. 698, 703 (116 S. E. 903); Fields v. Willis, 123 Ga. 273, 275 (51 S. E. 280). 2. It is true that in order to constitute one a surety his obligation must be “identical with that of the principal” (Graham v. Roberson, 79 Ga. 72, 74, 3 S. E. 611; Etheridge v. Rawleigh Co., supra), but identity of obligation does not necessarily mean identity of instrument; and while a surety is usually bound with his principal by the same instrument (Musgrove v. Luther Publishing Co., 5 Ga. App. 279, 281, 63 S. E. 52), this is not always true. The form of the contract is immaterial provided the fact of suretyship exists (Civil Code of 1910, § 3541), and one may assume that relation even by an instrument separate and distinct from that of his principal and also subsequent in time. Baggs v. Funderburke, supra. 3. It was stipulated in the instrument sued on in this case that its “true intent and purpose” was to render the makers thereof liable for any indebtedness of the corporation in which they were stockholders “precisely to the same extent” as if each of them “had duly and regularly indorsed the paper of said corporation,” and that they should be jointly and severally liable therefor “as indorsers are liable to the holder of a negotiable instrument under the law merchant.” It is clearly manifest from this language and the instrument as a whole that the parties signing it did so with the specific intent to become liable as “accommodation indorsers” or sureties. Civil Code (1910), § 3541. (a) Applying the rulings of the preceding paragraphs, the makers of the instrument upon which the action in this ease was predicated were sureties and not guarantors. It was therefore unnecessary that the plaintiff should allege that the principal debtor, the corporation, was unable to perform. Compare Fields v. Shores-Mueller Co., 25 Ga. App. 395 (1) (103 S. E. 473). 4. Suits against joint obligors or joint promisors residing in different counties may be brought in either county. Civil Code (1910), § 6541. One of the makers having resided and having been served in the county in which the suit was brought, the court was not without jurisdiction as to the plaintiff in error, although he resided in a different county in this State. 5. It was not necessary that the principal, — that is, the corporation for whose indebtedness the makers of the instrument sued on became liable as sureties, — should be sued in the same action. “The holder of a joint and several note may sue the obligors jointly or severally, or sue any one of the signers alone. On such an obligation he may sue the principal and the surety jointly, or .at his option he may sue either the principal or the surety alone. Civil Code (1910), § 3553, 3559; Reid v. Flippen, 47 Ga. 273, 275; McMillan v. Heard National Bank, 19 Ga. App. 148, 151.” Johnson v. Georgia Fertilizer Co., 21 Ga. App. 530 (3) (94 S. E. 850); Amos v. Continental Trust Co., 22 Ga. App. 348 (2) (95 S. E. 1025). However, there was no plea or demurrer raising the question of nonjoinder of parties. 6. In a suit against joint and several obligors residing in different counties where the court has jurisdiction of them both when the suit is filed, the [224] mere fact that the resident defendant is subsequently discharged upon some matter in avoidance not existing at the commencement of the action will not prevent the court from proceeding'to judgment against a nonresident defendant. Daniel v. Browder-Manget Co., 13 Ga. App. 392 (2) (79 S. E. 237). Under this ruling, the court did not lose its jurisdiction over the nonresident defendant because of the bankruptcy (even assuming a discharge therein) of the resident defendant, occurring after the institution of the action. Regardless of the soundness of the entire ruling contained in the second headnote of the decision just cited, the soundness of so much of it as is applicable to this case is not doubted. Therefore the request of the plaintiff in error, that this decision be reviewed and overruled, must be declined. (a) The rule as to jurisdiction of the nonresident defendant would be otherwise, however, if there was no joint liability at the time the action was brought, but even then, if the joint liability appears by the suit, the issue in regard thereto should be determined on the final trial and not on a dilatory plea. Williams v. Atlanta National Bank, 31 Ga. App. 212 (5) (120 S. E. 658). 7. One of the recited considerations of the instrument declared on was “the agreement on the part of the bank to renew any indebtedness of the corporation now existing for a period of at least 30 days from the maturity thereof.” While the plea alleges that the. principal debtor, Akin & Company, “did not secure or obtain any credits or indulgence,” it is not shown therein that the plaintiff violated its agreement to extend the same, but the contrary affirmatively appears. The plaintiff, on April 2, 1923, accepted a note due in 30 days for the existing matured indebtedness of the principal debtor, and even if the note was not so executed as to be binding upon the latter-, being signed without authority, it was subject to ratification by it, and in the event thereof would then have been binding as a renewal upon both parties thereto. Whether it was binding upon the plaintiff bank as a renewal or extension of the existing indebtedness, without such ratification by the purported maker, the bank treated it as such, and thus abided by its agreement in the instrument declared on, to renew any existing indebtedness for the space of 30 days. The plea, therefore, failed to show any failure of consideration, or any breach by the plaintiff. 8. Assuming that the plea sufficiently averred, as against a general demurrer, that the person who executed the note representing the alleged indebtedness of the principal debtor, Akin & Company, was acting without authority in so doing, and thus that the note as such would not be enforceable against the corporation, nor even properly considered as evidence of indebtedness against it, the plea having alleged that this note “represents a balance of $5,000 borrowed by Akin & Company in the year 1919, and $6,000 assumed by Akin & Company ,to plaintiff,” and the action not being based upon the note itself, but upon a separate writing, wherein the makers bound themselves to pay to the plaintiff bank “as the same becomes due, any indebtedness of [their principal, Akin & Company] . . now in existence 'or that may be hereafter created, whether by note, discount, acceptance, overdraft, indorsement, or in any other form,” it is immaterial in this action that the particular note may not have been executed by authority of the corporation, it thus [225] affirmatively appearing from tlie plea that Akin & Company was in fact indebted to the plaintiff in a sum equal to that for which the sureties were sued. Compare Jones v. Ezell, 134 Ga. 553, 556, 557 (68 S. E. 303). Decided April 24, 1924. 9. Applying the above rulings, the court did not err in sustaining the plaintiff’s general demurrers to the plea to the jurisdiction and to the defendant’s answer, nor in overruling the defendant’s demurrer to the plaintiff’s suit. 10. The plaintiff in error contends, that, the action being upon an instrumcnt providing for the payment of attorney’s fees, the recovery of which is dependent upon giving to the defendant the required statutory notice, and the trial judge having rendered judgment in the ease without a jury, the judgment is erroneous because it was not “couched in such language as to indicate that the judge, sitting as a jury, . . found the fact to be that written notice of suit had been as required by law,” as was ruled by this court to be necessary, in Valdosta &c. R. Co. v. Citizens Bank of Valdosta, 14 Ga. App. 329 (4) (80 S. E. 913). This court is unable, however, to concur in the construction which the counsel for plaintiff in error places upon the judgment. It appears to be dual in nature, importing a finding upon facts, together with a judgment thereon. This contention, therefore, cannot be sustained either as to the judgment as a whole or even as to the part thereof relating to attorney’s fees. Sen Elliott v. Wilks, 16 Ga. App. 466 (3) (85 S. E. 679). 11. Another contention of the plaintiff in error is that the judgment for attorney’s fees is not valid because the plaintiff’s allegations of notice to the defendant did not show a compliance with the statute (Civil Code of 1910, § 4252). This was an action by the obligee in the instrument declared on, a copy of which was attached, and which provided for the payment of such fees. The petition alleged that the defendants were indebted therefor. The following allegation made in the complaint (certainly in the absence of a special demurrer thereto) sufficiently averred a compliance with the statute with reference to the giving of such notice: “Petitioner shows that more than ten days prior to the filing of this suit it gave written notice to each and all of said defendants of its intention to sue on said contract evidencing said indebtedness to the September term; 1923 [to which the suit was made returnable] of the city court of Macon.” Stocking v. Moury, 128 Ga. 414 (2) (57 S. E. 704); Strickland v. Lowry National Bank, 140 Ga. 653 (4) (79 S. E. 539); Youmans v. Moore, 13 Ga. App. 119 (2) (78 S. E. 862); Reeves v. Gower, 14 Ga. App. 293 (2) (80 S. E. 699). 12. No other reasons are urged for reversing the judgment, and, it not being-erroneous upon any ground taken, affirmance must follow. Judgment affirmed. Jenkins, P. J., and Stephens, J., concur. W. T. Davidson, for plaintiff in error. Jones, Parle & Johnston, contra.