Cardell v. McNiel — 21 N.Y. 336

Majority

p. 362

Cardell v. McNiel.

Headnote

Guarantee of Payment.

If a vendor of goods deliver in part payment, the cliattel-note of a third person, and guaranty its payment, by paroi, this is not a promise to answer for the default of another, within the statute of frauds.^[1]

* ^ guarantee that the maker of a chattel-note is good, and that the person to whom it is delivered will get the chattel, when the note becomes due, is one of payment, not of collectibility.

The court of appeals will not reverse for an immaterial variance between the pleadings and the proofs, which was amendable below.

Appeal from the general term of the Supreme Court, in tire fifth district, where judgment entered upon the report of a referee was affirmed.

This was an action upon a verbal guarantee of a chattel-note. The plaintiff sold to the defendant a horse, and received in part payment the chattel-note of one Cornell, dated the 5th May 1854, for $125, payable in a top-buggy, worth that amount, on the 29th day of June then next. The defendant, through his agent, duly authorized to make the purchase, warranted Cornell to be “ good,” and

p. 363

that the plaintiff would get the buggy, when the note became due. There was no written guarantee of the note, which turned out to be worthless. The referee directed judgment in favor of the plaintiff, which Avas affirmed at general term, and the defendant appealed.

Morgan, for the appellant.

Ghurch, for the respondent.

The contract for the sale of the plaintiff’s horse to the defendant, Av'as concluded on the part of the latter, by his agent, Acker. The agent acted under a written authority, contained in anote addressed by the defendant to the plaintiff, stating that any bargain Avhich Acker might make, Avould be satisfactory to him, the defendant. This A\Tas a general authority, and very plainly it justified the agent in making the engagement on which this suit was brought.

By the terms of the contract, as testified to by the plaintiff’s Avitness, Greenfield, and as found by the referee, the horse was to be paid for in a span of horses OAvned by the defendant, Avhich Avere to be delivered to the plaintiff; by a note of $110, to be signed by the defendant and one Ingham; by a note of $40, given by one Burk; and by a note of $125, given by one Cornell, payable in a buggy, on the 29th June 1854. The defendant, through his agent, Avarranted Cornell to be “ good,” and that the plaintiff Avould get the buggy, Avhen the note became due. On these terms, the sale Avas completed, and the plaintiff delivered his horse. The notes were to be sent to the plaintiff on the following day, and they Avere sent accordingly. There Avas no Avritten guarantee of the note of Cornell; Avhich turned out to be A\mrthless. The action is founded on the verbal undertaking.

We think, that the plaintiff’s acceptance of the note, Avhen it Avas sent to him, AAÚthout a guarantee indorsed,

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worked no change in the terms of the contract. The defendant, by his agent, agreed to be answerable for the payment of the note. *If that agreement was valid in law, without being committed to writing, there is no fair pretence for saying that it was waived or discharged, because it was not written upon or annexed to the note, when the note was sent to the plaintiff and accepted by him. The guarantee was a verbal one, and was accepted as such, when the horse was delivered, on the completion of the sale, and there is nothing in the finding of the referee, nor in the evidence, tending to show that a written undertaking was in the contemplation of the parties. The defendant, in effect, said: “I will send you the note of Cornell, and I agree to be answerable for its payment.” I am unable to see how the acceptance of the note "waived the agreement.

We think, in the next place, that the guarantee was, in effect, one of payment, according to the terms of the note, and not for the collection of the demand by process of law. The evidence and the finding are,othat the defendant’s agent said, that the maker ivas good, and that he would warrant that the .plaintiff would get the buggy, when the note fell due. The obvious meaning of this is, that the obligation would be paid at maturity, and according to its terms. The contract was, therefore, broken, and the defendant became liable to suit upon it, when Cornell failed to pay, after payment was due.

It is claimed, that- thesguarantee is void by the statute of frauds. In' mere form, it was certainly a collateral undertaking, because it was a promise that another person should perform his obligation; but, looking at the substance of the transaction, we see, that the defendant paid, in this manner, a part of the price of a horse sold to himself. In a sense merely formal, he agreed to answer for the debt of Cornell; in reality, he undertook to pay his own vendor so much of the price of the chattel, unless a third person should make the payment for him, andthere

p. 365

by discharge him. The question, at this time, hardly claims a discussion, because it Avas, in effect, decided by this court, upon the fullest consideration, in Brown v. Curtiss, ( 2 N. Y. 225 ). There, the holder of a note transferred it in payment of his own debt, indorsing upon it a guarantee of the payment, which expressed no consideration; and on . that ground the undertaking *was claimed to be void. It was conceded to be void, provided the statute applied to such a case, it was, however, held to be a valid promise, on the ground that the statute did not apply. “ In such cases,” it was observed, “ where the party undertakes, for his own benefit, upon a full consideration received by himself, the promise-is not within the statute.” It is impossible to distinguish, in principle, between that case and the present; certainly, no distinction can be drawn favorable to the defendant. (Johnson v. Gilbert, 4 Hill 178 ; Nelson v. Boynton, 3 Metc. 400 .)^[1]

The note of Cornell not being paid at maturity, the defendant became absolutely charged as the guarantor, and the debt was from that time due in money. It is urged, however, that the defendant was discharged, by a new arrangement made between the plaintiff and Cornell. This arrangement is not found by the referee, and that alone would be a sufficient answer to the proposition. But, upon the evidence, it is only claimed that the plaintiff agreed to Avait for the buggy, six weeks longer, that Cornell agreed to deliver it, at the expiration of that time, and if its value was more than $125, then, that the difference Avas to be paid. There is no pretence, that the article was in fact ever offered to the plaintiff, nor, indeed, that it was ever made for him. Assuming such an agreement to have been proved, it was. purely executory; it Avas never, in fact, executed; and upon the plain principles

1 And see Milk v. Rich, 15 Hun 178 ; Sanders v. Gillespie, 59 N. Y. 250 ; Gallagher v. Nichols, 60 Ibid. 438.

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of law, it did'not discharge the previous liability either of Cornell or of the defendant. There was no contract for a different article, which professed to bind both the parties, and nothing, therefore, in judgment of law, was substituted for the pre-existing agreement. There was simply an extension of time, founded on no consideration, and therefore binding on no one.

It is further said, that tlie complaint counts upon a warranty of the note, made at the time it was sent and delivered to the plaintiff; whereas, the proof showed that the only warranty, if made at all, Avas given previously, at the consummation of the sale, when the horse Avas delivered. To this we ansAver, the variance does not appear to have been mentioned at the *trial, and, if it had been, the pleading might have been amended, if necessary, in the court below. In this court, Ave do not reverse judgments, upon objections of such a character.

Judgment affirmed.

End of March Term.

Cases cited

Brown v. Curtiss 2 N. Y. 225 N.Y. p. 365