Walsh v. Bailie — 10 Johns. 180

Majority

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Walsh and Beekman against Bailie.

NEWYORK,

May, 1813.

Headnote

A. of JVew* York, gave a letter of credit to B., addressed to G. in Albany, requesting C. to deliver goods to B. on the. best terms, to a certain amount. C. instead of delivering the goods himself, gave B. a letter to D., in Geneva, requesting him to deliver goods to B. to the amount, and engaging to he responsible, and D. accordingly delivered the goods to B. In an action brought by C. against A. for the amount, it was held that the engagement of A. to C. did not make him answerable for goods furnished by any other person. A surety is not answerable beyond thescope of his engagement.

THIS was an action of assumpsit. The declaration was for goods supplied by the plaintiffs to John and George Sherman, at the request of the defendant; and also for goods sold generally by the plaintiffs to the defendant. Plea, non assumpsit. The cause was tried at the Albany circuit, before Mr. Justice Thompson.

The plaintiffs gave in evidence the following letter of credit, addressed to the plaintiffs, who are merchants at Albany, under the firm of Dudley Walsh <§■ Co.;

“ Nerv-York, May 16,1810.

“ Messrs. Dudley Walsh & Co. Albany,

“ Gentlemen,

“ You will please to supply Messrs. John and George Sherman, of Jerusalem, with any goods they may want to the amount of one thousand, or fifteen hundred dollars, for which I shall hold myself accountable to you; and I request the favour of you to supply them on the best terms. I remain, &c. " “ William Bailie.”

.. The plaintiffs also gave in evidence the following letter from them to Abraham Dox, a merchant at Geneva:

“Albany, May 21,1810,*

“ Mr. Abraham Dox,

“ Dear Sir,

“This will be handed you by a Mr-Sherman, one of the partners of Messrs. John, and Georg&

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Sherman, of Jerusalem, who brought us a letter of credit from a friend of ours, Mr. William Bailie, of New- York, for one thousand, or fifteen hundred dollars, in merchandise.

“ Messrs. Shermans prefer purchasing from you, at the pre= . sent time, as the season is so far advanced. As the amount you credit those gentlemen is perfectly safe, we have no doubt you will furnish them with what they want, to the amount above mentioned, on the most liberal terms. With great regard yours,” &c.

“ Dudley Walsh <fr Co.”

41 P. S. As Mr. Bailie is responsible to us for the sum before mentioned, we have no objection to be accountable to you, if you deem it necessary.”

On receiving the above letter from the plaintiffs, Dox delivered goods, in June, 1810, to J. and G. Sherman, to the amount of about 1,500 dollars; and afterwards sold them other goods, on their own personal credit, all of which were charged generally to J. and G. Sherman, in the books of Dox. No time of credit was specified, but it xvas proved that his usual term of credit was 4 months. The plaintiffs are merchants of established reputation, doing business on a very large scale, at Albany. Dox is a merchant at Geneva, in the county of Ontario, and obtains almost all Ms goods on credit from the plaintiffs.

The defendant’s counsel moved for a nonsuit, on the ground that the sale of the goods to J. and G. Sherman was not within the scope of the letter of credit to them. The motion was overruled, and a verdict taken for the plaintiffs, for 1,500 dollars, subject to the opinion of the court, on a case containing the above facts, with liberty to either party to turn the same into a special verdict.

A. Van Vechten, for the plaintiffs,

cited 1 Carth. 446. 3 Wils. 532. 1 Term Rep. 291. 7 Term Rep. 254.

Henry, contra,

contended that the letter of credit was personal, In regard to the plaintiffs, and did not authorize them to transfer the defendant’s responsibility to a third person and a stranger. This was a case of a surety, who will not be held responsible beyond the strict letter of his engagement. He said that he relied on the very cases cited by the plaintiffs’ counsel, and the doctrine of which was recognised by the court of errors, in the case of fmdlow v. Stmonds,^[1] Again, the P. S. to the plaintiffs’ letter

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to Dox, contains only a guaranty; and the surety cannot bring his action until he has paid the money.

Van Vechten, in reply,

said that it was immaterial to the defendant, whether the plaintiffs had paid Dox or not. Dox did not look to the defendant. He had no concern in the engagement between the present parties. It was perfectly immaterial whether the plaintiffs delivered the goods themselves, or caused them to be delivered by another person, on their request. It was enough that the goods were, in fact, delivered to the defendant, pursuant to the letter of credit.

The contract was made with the plaintiffs that they were to supply the Shermans with the goods, and on the best terms. Instead of supplying the goods themselves, the plaintiffs desire Dox, a merchant at Geneva, to supply the goods, and express no doubt that he would do it on the most liberal terms. The terms of Dox might have been very different from those of the plaintiffs, especially, as the plaintiffs resided in Albany, and traded on a large scale, and Dox lived far in the interior of the country, and obtained his goods on credit from the plaintiffs. Dox might not have had the means, nor the capital, to supply the goods on as good terms as the plaintiffs. The terms exacted by Dox might have been such as to injure the Shermans in their business and credit, and have led to a failure; whereas the terms of the plaintiffs might have been such as to have enabled the Shermans to have met them, and have saved their credit. The defendant might not have been willing to have ■been security for the Shermans, for goods purchased of Dox ; and it is sufficient for them that they made no such engagement. They were to be answerable for the goods to be furnished by the plaintiffs,- confiding in their ability and willingness to supply them on good terms. They made no engagement to be answerable for goods furnished by any other house; and, consequently, they are not answerable in this case. The case of Myers v. Edge, (7 Term Rep. 254.) is analogous, and the principles of it in point, though the circumstances were not, perhaps, so strong in favour of the surety. There was a promise;, in writing, directed to the trading house of A., B. .and C., to pay for goods to be furnished to D., and as the goods were furnished after A., one of the partners, had withdrawn from the partnership, the party, making the

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promise was held not liable. A surety is not to be bound beyond the scope of his engagement.

A new trial ought, therefore, to be awarded, with costs to abide the event of the suit.

New trial granted.