Manatee County State Bank v. Weatherly

DOWDELL, J. This case was tried in the court below without a jury on an agreed statement of facts, by which the issue was determined on the construction of a contract of guaranty made by the Alabama National Bank of Birmingham to the Manatee County State Bank. The said contract of guaranty was as follows: “Birmingham, Ala., Nov. 27,1899. Manatee Co. State Bank, Palmetto, Fla. — Dear Sirs: We guarantee the payment of drafts for six cars of oranges at $2.25 per box, to be shipped by McLean & Sims to Williams & Marks or to W. & M. direct; provided each B. L. be accompanied by a certificate that oranges were sound when loaded and shipped according to signed contract between McLean & Sims and Williams & Marks. Williams & Marks to be allowed a rebate of 5 cents per box and drafts to come direct to us. Yours truly, (Signed) W. A. Porter, Cashier.” The six cars mentioned were shipped and paid for and afterwards, Williams & Marks wishing to purchase four more cars of oranges, the Alabama National Bank wired the Manatee County State Bank as follows: “We guaranty four cars of oranges McLean & Sims, conditions as last six.” These four cars were accordingly shipped, and Williams & Marks refused to pay the drafts for three of the car®, on the ground that McLean & Sims had not complied with their contract, and notified the Alabama National Bank that it must not pay the drafts, and that, if it did so, they (Williams & Marks) would refuse to recognize or ratify such payment. Accompanying three of the bills of lading for the first- six cars of oranges were certificates of McLean & Sims stating, in substance, that the oranges were sound and according to contract. The [658] three other certificates accompanying the other three of the first six cars, having been lost or mislaid, were not introduced in evidence. The certificates accompanying the three cars of oranges in controversy only stated that the oranges called for by 'the bill of lading were sound and merchantable when loaded, without making any reference whatever to the contract between McLean & Sims and Williams & Marks, which contained stipulations as to sizes and colors of the oranges to be shipped, as well as other stipulations, and without stating that they were “shipped according to signed contract.” The rule seems to be well settled in this state that the contract of a surety or guarantor must be strictly construed according to’ the letter of the undertaking. The surety has a right to- stand upon the terms of his contract, and it cannot without his assent be changed in any respect. To the extent and in the manner stated in his contract he is bound, and no further. — May v. Alabama National Bank, 111 Ala. 510, 20 South. 459; City Council of Montgomery v. Hughes, 65 Ala. 204; Anderson v. Bellenger, 87 Ala. 336, 6 South. 82, 4 L. R. A. 680, 13 Am. St. Rep. 46; Crescent Brewery Co. v. Handley, 90 Ala. 486, 7 South. 912. See, also, Miller v. Stewart, 9 Wheat, (U. S.) 680, 6 L. Ed. 189; 14 Am. & Eng. Ency. Law (2d Ed.) 1144. In Miller v. Stewart, supra, it is said: “Nothing can be clearer, upon both principle and authority, than the doctrine that the liability of the guarantor is not to be extended by implication beyond the terms of his contract. To the extent and in the manner and under the circumstances pointed out in his obligation he is bound, and no further It is not- sufficient that he may sustain no injury by the change in the contract, or even that it may be for his benefit. He has a right to stand upon the very terms of his contract, and if he does not assent to any variation of it, and a variation is made, it is fatal.” Under the doctrine laid down in the above case, and applying the principle there stated to the guaranty executed by the' Alabama National Bank to the Manatee County State Bank, it clearly appears that the condition of the guaranty was not complied with in the three certificates in controversy. The guaranty was conditional, as well as special. The [659] undertaking of the Alabama, Bank was to pay tbe drafts, if Williams & Marks did not, provided that each bill of lading should be accompanied by a certificate “that oranges were sound when loaded and shipped according to signed contract between McLean' & Sims and Williams & Marks.” The certificates accompanying the bills of lading of the three cars in controversy were not in compliance with the terms of the contract of guaranty. They failed to affirm that the oranges were “shipped according to the signed contract between McLean & Sims and Williams & Marks,” which contract’set forth specifically what proportion of different sizes there should be in each car, and also what proportion of different colors there should be. These terms and conditions are not ‘without significance, and to hold that a certificate was sufficient which only affirmed that the oranges were sound and merchantable would be to vary the terms of the guaranty and impose a liability against which the guarantor guarded expressly by his contract. In the case before us by the agreed statement of facts the liability of the defendant in this suit was made to depend upon the liability vel non of the Alabama Bank to the Manatee Bank on the guaranty of the former to the latter, on the facts. The trial court rendered judgment in favor of the defendant, which ruling was in accord with the views we have above expressed, and the judgment will therefore be affirmed. Affirmed. McClellan, O. J., and Anderson and Denson, JJ., concur.