Beagle v. Cable

MERWIN, J. The recovery here is on the theory that Lee &. Eggleston are liable to the plaintiffs and therefore the defendant is. liable on his guaranty. The defendant does not guaranty that Lee & Eggleston should perforin their contract. He only guaranties the-payment of the saw bill upon the terms and conditions imposed in. the contract. According to those terms, a portion of the saw bill became due from time to time, according as the work progressed., That amount has been paid by the defendant, or substantially that amount. The balance of the saw bill for the ties was to be paid, when the ties were counted and accepted by the railroad company. That is not shown to have been done. The balance of the saw bill for the lumber was to be paid when the entire job should be finished up in conformity with the contract of September 9th between Cable & Buckbee and Lee & Eggleston, and when the remaining-sum should become due according to the terms of that contract. That evidently referred to the division to be made upon a sale of' the property. That contingency has not happened. The job has not been finished, and it is not shown that either the ties or the lumber that the plaintiffs sawed has been- sold or marketed. So that, if the terms of the contract are to be followed, the recovery cannot be sustained. It may be that the plaintiffs could recover the amount from Lee & Eggleston, but such recovery would only be allowable by reason of the breach of the contract by Lee & Eggleston (Nichols v. Steel Co., 137 N. Y. 471, 487, 33 N. E. 561); and for such breach the defendant would not be responsible. The recovery in such case would be for damages for the breach. In Creamer v. Mitchell, 162 N. Y. 477, 486, 56 N. E. 977, the rule is said to be well settled that a guarantor is bound only by the strict letter or precise terms of his 811 contract, and that the claim against him is strictissimi juris. The recovery here would seem to be in contravention- oí that rule. The-defendant is made to bear the consequences of a breach by Lee & Eggleston that he did not covenant against. Under the original-contract, he was the party who had the exclusive right to sell the-property, and then divide the proceeds. He had the right to expect that as to the balance of the saw bill, over and above the advancements to be made as the work progressed, he would not be called upon for payment under the guaranty until he had funds from the sale of the property, as contemplated in the original agreement, which is referred to in the subsequent contract, and its provisions adopted. The trial court erred, I think, in charging defendant with the balance of the saw bill, and the judgment, therefore, must be reversed. Judgment' reversed, and new trial granted, costs of appeal to the appellant to abide the event. All concur.