Rankin v. Childs

McBride, J., delivered the opinion of the court. This was an action of assumpsit, brought by William and Smith Rankin, against the defendants, Childs & MeCourtney, in the Cooper circuit court, at the June term 1843. The declaration contains two counts; the first for joists, plank, and other building materials, sold and delivered to the defendants, for the work and labor of the plaintiffs, done at the request of defendants; for money paid, laid out, and expended; for money had and received, and on an account stated. The second count, and the one upon which the plaintiff mainly sought to recover against the defendant Childs, set forth and alleged that the plaintiffs, at the request of MeCourtney, sawed and delivered to him a large quantity of materials for the building of a ferry-boat; and upon the delivery and acceptance of the said materials to the defendant, MeCourtney, the said Childs and MeCourtney guarantied the payment of as much money — 668 — therefor as they were reasonably worth. The defendants pleaded non-assumpsit. At the March term 1845, the plaintiffs, having suggested the death of McCourtney, abated their suit as to him, and went to trial against the surviving defendant, Childs. After the plaintiffs had closed their evidence, the defendant by his counsel, moved the court to instruct the jury that the plaintiffs could not recover, and were not entitled to a verdict upon the evidence given in the cause. The court instructed the jury accordingly, whereupon the plaintiffs took a non-suit with leave to move to set the same aside. A motion was made by the plaintiff’s attorney, to set aside the non-suit, and grant a new trial, because the court erred in giving the instruction prayed for, which beimg overruled the plaintiffs excepted, and have brought their ease here by appeal, and seek a reversal of the judgment of the circuit court. The principal question in this case arises on the instruction given to the jury by the court; and whether that instruction be correct or not, depends upon the legal import of the defendant Childs’ undertaking. In construing this transaction, as well as all others, it is the duty of the court to ascertain with as much certainty as practicable, what was the intention of the contracting parties, and to give effect to that intention. Whenever parties may legally contract, the law permits them to do so upon their own terms and conditions, and does not assume to make contracts for them. Neither will the courts, when their aid is invoked, undertake to vary the terms and conditions agreed upon between them. Justice Thompson, in the case of Lee vs. Dick, 10 Peters, 492, says, “A guarantee is a mercantile instrument, and to be construed according to what is fairly to be presumed, to have been the understanding of the parties, without any strict technical nicety.” The evidence shows, that the defendant McCourtney, desiring to build a ferry-boat for 1ns own use, called upon the plaintiffs, who were owners of a saw-mill in the vicinity, to purchase lumber for the construction of his boat. The plaintiffs refused to credit him for the lum~ ber, as he was a stranger to them, unless he would give them security for the payment thereof, whereupon McCourtney mentioned the name of his co-defendant Childs, as such security, who plaintiffs said was good: that a few days thereafter .McCourtney returned to the plaintiff’s saw-mill, and delivered to them a written bill, purporting to be in Child’s hand-writing, specifying the building materials, &c., to be sawed and delivered by the plaintiffs to McCourtney at the place of building the boat; at the foot of the bill is the following: “Messrs. Rankins — 669 — will furnish the above bill as soon as possible, and I will order what more I may want for my boat in a short time. James McCourtney. I hereby guarantee the payment of the above bill: Jan. 29. 1842. Wm. Childs.” On the tenth February, the plaintiffs commenced the sawing, and delivery of the materials in the bill, to McCourtney, at the place of building the boat, and continued the delivery up to the 12th May, 1842, when they completed it; that during the delivery of the materials, and the building of the boat, Childs was frequently present as a visitor, taking no control or management in the matter; that during the delivery, McCourtney procured one Allen, (who was the clerk of Childs in his steam-mill, situate near the place of delivery,) to measure the lumber, &e., and keep an account thereof, but there was no evidence given, conducing to show that Childs knew this; that the materials, &c., furnished, when thrown into board measure, were worth two dollars per hundred feet, and that McCourtney agreed to pay that price for the same. It may be unquestionably assumed from the foregoing facts, that the boat, for the building of which the materials were furnished, was to be built by McCourtney, and for his own use; Childs had no agency in the construction of, or interest in the boat. He acted solely in the transaction as t1'- viend of McCourtney. McCourtney made the contract with the plaintiffs, which was conditional on their part. If McCourt-ney would give them Childs as security, then, they would furnisli him with the materials, delivered on the bank of the river, at two dollars per hundred feet. This must have been the terms of the argreement, as there is no evidence of another interview between the plaintiffs and McCourtney, prior to the making out the bill for the materials. The order at the foot of the bill, signed by McCourtney, goes to show that a previous agreement as to price, and place of delivery, had been made between them. Although Childs appears to have had no interest in the boat, yet he might bind himself jointly with McCourtney, to pay for the materials furnished, by the use of apt words for that purpose. If he had so intended. is it probable he would have used language which he did for that purpose? Justice Story says, in 7 Cranch, 90, “that.the law will subject aman having no interest in the transaction, to pay the debt of another, only when his undertaking manifests a clear intention to bind himself for the debt.” Words of doubtful import, ought not, it is conceived, to re* — 670 — ceive that construction. It is the duty of the individual who contracts with one man on the credit of another, not to trust to ambiguous phrases and strained constructions, but to require an explicit and plain declaration of the obligation he is about to assume. The plaintiff’s attorney insists, that the terms used, “I hereby guarantee the payment,” &o., are equivalent to saying, “I hereby promise to pay,” &c. But we think there is a manifest difference in the force of the language used. The word'*' “guarantee,” is an undertaking to do an act, or perform a duty for another, in the event of his not performing. Judge Story defines it to be an original collateral undertaking; whereas, the other is a direct, positive and unconditional promise to pay. If Childs had intended to bind himsef jointly as principal in the contract, it is remarkable that he used the language which he did. The use of the word guarantee, by Childs, satisfies my mind, that he understood its import, and used it understand ingly; that he only intended to bind himself to pay, in the event of the plaintiffs being unable to make the amount out of McCourtney. If Childs intended to become jointly bound by his memorandum at the bottom of the bill, why did hr not cause McCourtney to sign with him. It will be seen that McCourt-ney by his note, does not himself expressly promise to pay for the materials furnished for his own boat, and yet it is said, Childs has unconditionally promised to pay for them. In Lee v. Dick, 10 Peters, 492, the following note was addressed by the defendant to the piaintff: “Gentlemen: Nightingale and Dexter, of Maury county, Tennessee, wish to draw on you at six, or eight months date. You will please accept their draft for S200Q, and I do hereby guarantee the punctual payment of it. Very respectfully, yr. ob’t serv’t. Samuel B. Lee.” This was held, without any question whatever, to be a guarantee. But substitute die word promise for guarantee, and no doubt, would be entertained of the defendant’s direct and positive undertaking, and liability, to pay the 4111000 at maturity. So in the case of Mason v. Pritchard, 2 Camp. 436, where the defendant wrote the plaintiff, “I hereby promise to be responsible to T. M. (the plaintiff,) for any goods he hath, or may supply my brother W. P., to the amount of £100,” it was held, that this was a standing or continuing guarantee to the extent of £100, which might at anytime become due for goods supplied, until the credit was recalled. In this case the undertaking was more direct, and unequivocal, than in the ease now before us.T here the extent of liability was fixed ; here, there is no specified amount ascertained, or assumed to be paid. — 671 — In the case of Marle vs. Wells, 2 Cam. 413, the defendant wrote to the plaintiff) “I have been applied to by my brother W. W. to be bound to you for any debts he may contract, not to-exceed 100 pounds (with you) for goods necessary in his business as a jeweller; I have wrote to say by this declaration, I consider myself bound to you for any debt ha may contract for his business as a jeweller, not exceeding 100 pounds after this elate;” it was held, that the defendant was answerable as guarrantor for any debt not exceeding 100 pounds, which W. W. might, from time to time, contract with the plaintiff in the way of business. . So likewise in the case of the Oxford Bank vs. Haynes, 3 Peck. 423, where, upon the back of the promissory note made by S. & h. to the plaintiff, was written the words, i!I guarantee the payment of the within note,” and signed by the defendant; it was held, that he. wa s a guarantor, and not a surety. And in Dole vs. Young, 24 Peck, 250, the following writing was signed, and addressed to the plaintiff, by the defendant: £6 Pisase sr-ud W. goods to the amount of ($100, and I will guarantee the same u four months,” and the plaintiff immediately after the presentation thereof, delivered goods to Yd. It was hold that this was strictly a guarantee of the debt of W., and not an original undertaking on tho part of the defendant. These case*, and many others to be found in the boohs to the came point, go conclusively, wo think, to establish the extent of the fc-fend--ant Childs’ undertaking, and make it a guaraníes, an original ceil, lov' undertaking, and not an unqualified promise, to pay the dost oi’ku; ce ■ defendant MeCourtney. We aro free to admit, however, t-jat two tie 'decisions which mi.-itate against the conclusion to which wo rovo f.o; .-g and some of very high authority; in this conflict we have ¡¿..hui/P iv-the rule of our action, those decisions which appear to na tobe jp-a/: consonant with the principles of justice, and as tending in the most c inent degree, to carry into effect the l-onct, fule intention of the ooutrael-ing parties, at the time of the contract. In ascertaining this iní/intíc:!, we have not confined our investigation to a mere technical construction of the writing signed by the defendant childs, but have taken into consideration ail of the attendant circumstances. It is insisted, however, iu argument, that the creu’t was given by the plaintiffs to Childs, and not to MeCourtney, who was a stranger to them; and that therefore Childs is liable as original obligor. In this particular, we 'cannot distinguish this case from innumerable other cases of guaranties, to be found in the books; and indeed it is in part the object which the guarantor has in view in making the guaranty. If the princi — 672 — pal be fulSciently responsible to obtain the desired credit, upon his own account, there would appear to be no necessity for requiring a guarantee from a fhird person, having no interest, and deriving no advantage from his undertaking. The fact of a guarantee being given, or required, presupposes a want of credit on the part of the principal, and if the argument be sound to the extent urged, such a relation could scarcely ^rist between parties. He who undertook, no matter upon what terms, or conditions, if his principal should be irresponsible, to secure the ultimate performance of a contract, would instantly himself be converted into a principal; for, the credit, in whole or in part, would be given upon the responsibility of the guarantor. This would be unreasonable ; it would be a harsh rule to apply to one, operated upon by feelings <•!' friendship, and who had, without any pecuniary interest whatever, involved himself for his friend. It is c<*-‘ainly true, as before remarked, that a man may bind himself to pay the debt of another person, in which he has neither a direct nor a remote pecuniary interest; but in doing so he must not only intend to do it, but he must use appropriate words to bind himself, and the courts wdl not by a strained construction of his language, subject him to such a penalty: 7 Cranch, 90. It was also urged in the argument, as a circumstance entitled to consideration, that the bill of materials was made out by childs. We think there is no importance to be attached to that fact, as McCourtney had an equal ;ht to obtain the services of Childs in aiding him to draw up the bill, ? . die services of any other individual; and Childs thus lending him the benefit of his superior skill, did not subject himself to any legal liab-Cty. Neither do we think that there is any force in the fact, that the guarantee was made upon the same piece of paper, and at the foot of the bill. Tli t being sufficient space for it to be made there, it was equally as conven ient so to make it as upon a distinct piece of paper. Where-ever mad,-., it would in no wise change the defendant Childs’ liability. If we 1 <ve correctly determined the nature of Childs’ undertaking, then the >ctrine is well settled that before he can be made liable, it was the d y of the plaintiffs to give him notice of their acceptance of his guara ee, and the failure of McCourtney to pay for the materials before they can charge him. In Russell vs. Clark, 7 Cranch. 92, it was distinctly held by the court, tb:. i in cases of garanties it is the duty of the plaintiff to give the defc h.nt immediate notice of the extent of his engagement. In 24 Peck, 250, it was decided that in order to maintain an action against — 673 — a guarantor, a demand of payment must be made in a reasonable time of the principal, and notice of non-payment .given to the guarantor; and if in consequence of the v/ant of such reasonable notice, the guarantor is prevented from, getting his indemnity of his principal, or otherwise suffers a less, he shall be exonerated. The same principle was held in the case before cited from 8 Pick. 423. And the reason of this rule appears obvious, as it may be most material, not only as to the guarantor’s own responsibility, but as to future rights and proceedings. It may regulate in a great measure his course of conduct and his exercise of vigilance, in regard to the party in whose favor it is given. In 10th Peters, 496, the court say “there are many cases where the .guarantee is of a specific existing demand by a promissory note or other •evidence of debt; and such guarantee is given upon the note itself, or with a reference to it, and recognition, of it when no notice would be' ■necessary.. The guarantor in such cases knows precisely what he .guarantees and the extent of his responsibility, and any further.notice to him would be useless; 14 John, 349; 20 John. 365. But when the ■guarantee is prospective, and to attach upon future transactions, and the guarantor uninformed whether his guarantee has been accepted and acted upon or not, the fitness and justice of the rule requiring notice, ■is supported by considerations that are unanswerable.” The ease now under consideration comes fully within the letter and spirit of the rule above laid down. The guarantee is prospective, and the amount indefinite. The only pretext of a notice to Childs, that his guaranty had been accepted, is to be found in the fact that he was frequently at the place of building the boat during the time of its being built and the materials delivered. Whether that would constitute a sufficient notice of the acceptance of his guarantee, and that upon the faith thereof the plaintiffs were delivering the materials for the boat, ought to have been left to the jury. But there was no evidence whatever tending to prove a prior demand of payment, and refusal to pay, on the part of McGourtney, and notice of that demand and refusal given in a reasonable time thereafter to Childs. Proof of such notice is absolutely necessary to charge Childs upon his guarantee, unless the plaintiffs can show that MeCourtney was insolvent, and that Childs was ap.pidzed of that fact, and consequently sustained no injury by reason of their failure to give him such notice. Judge Napton concurring herein, the judgment of the circuit court ss affirmed.