Wheelwright v. Moore — 1 N.Y. Super. Ct. 648

Majority

p. 648

John Wheelwright versus John A. Moore.

April Term, 1829.

Headnote

In an action upon a guaranty, where the defendant, relying upon the statute of frauds, pleads that “the promise mentioned in the declaration, isa special pro- “ mise to answer for the debt of a third person," and that no note or memoran- “ dum in writing, shewing the consideration of such promise was ever signed by “ him,” the plaintiff, if the consideration of the guaranty was the sale of goods •to a third person, made at the same time with the guaranty, must set forth by Ms replication, what he would be bound to shew in evidence, if the statute were not pleaded. It must appear by the replication, that the sale of the goods and the making of the guaranty, were simultaneous acts, constituting parts of one and the same agreement.

The third and fourth counts of the plaintiff’s declaration set forth, that one S. made certain promissory notes to the plaintiff the payment of which, the defendant guarantied, “ in consideration of value received by S. and the defendant.” The defendant having pleaded the statute, the plaintiff replied, setting forth a written promise of the defendant, containing copies of the notes which were expressed to be “ for value received.” The guaranty also set forth, “ that in purs',:- “ anee of the understanding” between the plaintiff and S., the defendant stipulated to pay the notes, if S. did not. Held, that the replication did not support the averments in the declaration; the contract there set forth, not appearing with sufficient certainty, to rest on the same consideration.

This case was formerly before the court, upon a demurrer to the plaintiff’s evidence, [ante p. 201.] It was an action upon a guaranty given by the defendant to secure the payment of three certain promissory notes, made by one Scovell in favour of the plaintiff. •

The declaration contained four counts. The two first were like those contained in the former declaration, and differed by confining the breach of the defendant’s contract to the non-payment of the second note, merely.

The third count alleged, that Scovell, on the 5th day of December, 182?, made three several promissory notes in favour of the plaintiff, for the sum of three thousand five hundred and thirty dollars, and twenty-seven cents each: the first being payable in seven, the second in nine, and the third in twelve months after date. That the defendant, “ in consideration of value received by‘ Scovell and him, the said defendantundertook and promised the

p. 649

plaintiff, “ that he would guaranty the just and full payment” of the aforesaid notes “ to the plaintiff, or his order.” This count then averred, that the second of said notes had become due, but that the same had not been paid either by Scovell or the defendant, nor had the defendant guarantied to the plaintiff “ the just “ and full payment thereof,” although requested, &c.

The fourth count was substantially like the third, but confined its allegations to the second note, omitting the others entirely.

The defendant relied upon the statute of frauds as a defence, and pleaded separately to each count of the declaration, that the promise therein mentioned as having been made by the defendant, “ was a special promise to answer for the debt of a third “ person, to wit, for the debt of Noah Scovelland that “ no agreement in respect of, or relating to, the said supposed pro- “ mise, or any memorandum or note in writing, wherein the con- “ sideration for such promise was expressed, stated, and shown, “ according to the form of the statute in such case provided, was “ ever signed by the said defendant, or by any other person or “ persons, by him thereunto lawfully authorised.”

To this plea, the plaintiff replied, that the promise mentioned in the declaration, “ or the agreement in relation to the same,” was in writing; and he set forth the notes of Scovell, and the special agreement of the defendant, exactly as they appeared in evidence in the former case. The replication then averred, that the consideration of the said promise was “ expressed or stated in “ writing in the said agreement,” “ according to the form of the “ statute,” and that “ the said instrument in writing was sign ed by the defendant;” and prayed that the same “ might be inquired of by the country.”

To each of these replications, there was a separate general demurrer ; and the cause was now argued by Mr. J. Anthon, for the defendant, in support of the demurrer, and by Mr. Wilkes, for the plaintiff.

Mr. Anthon contended:

I. That the promise was a collateral one, on the face of the pleadings, and to be valid, should have the consideration expressed. II. That the consideration, as ex

p. 650

pressed, is the understanding and agreement between Wheelwright and Scovell, which is unintelligible, without recourse to oral testimony, and, therefore, the promise is void. III. That the consideration expressed in the agreement, varied irom the consideration averred in each of the counts, and, therefore, the replications were departures. The two last counts aver, that the consideration for the defendant’s promise, was value received by him and Scovell; the written agreement disclosed by the replication, expresses “ the value” to have been received from Scovell alone. This is a manifest departure from the declaration, and the defect may be taken advantage of by general demurrer. He cited the case of Morley v. Boothby, [3 Bing. R. 107,] as precisely in point.

Mr. Jlnthon observed, that the agreement set up in the two first counts of the declaration, had already been before the court, when the case was presented by the demurrer to the plaintiff’s evidence; and it was then decided, that the proof did not support the declaration. The court held, that the plaintiff had the right to- show, that the credit given to Scovell, and the signing of the guaranty, were one transaction: and that if it were proved, that the two acts were concurrent, then one consideration would be sufficient to support both promises. But the court, at the same time' decided, that the contract itself, upon its face, did not show, that the transactions were one entire agreement, and, therefore, that the declaration was not supported by the proof.

The defendant has not varied his case in relation to the two first counts, in any way, except by pleading that now, which he then gave in evidence. The court cannot infer that the two acts were concurrent; but, on the contrary, the fair presumption is, that Scovell’s notes were made and delivered before the defendant’s guaranty was given. If so, the contract was. clearly void. [Fell on Guar. p. 25, 37.]

Mr. Wilkes, for the plaintiff, contra,

contended, that the “value “ received,” specified in the notes of Scovell, was the consideration, not only of the notes, but also of the guaranty, in which they were incorporated. Both promises were branches of the same contract, and founded on the same consideration.

p. 651

The cases from the English books cannot be considered as authorities here, when they contradict the spirit of the decisions of our own courts. Wain & Warlters, so far as it has any application to this agreement, is expressly overruled by the case of Leonard against Vredenburgh, [8 Johns. R. 39.] The plaintiff relies upon that case, as conclusive in his favour, and the doctrine asserted by Chief Justice Kent, is sufficiently comprehensive, to embrace every principle for which we contend. The strictness of the English courts in relation to proof of consideration under the statute of frauds, is not required by our tribunals; but effect will be given to a contract, where the requirements of the act have been substantially complied with. [D’Wolf v. Rabaud, et. al. 1 Peters S. C. R. 477.]

But if the first and second counts be obnoxious to the objections raised, the third and fourth have a sufficient consideration expressed on their face, and which is proved by the agreement. It is stated in the declaration, that the defendant’s promise was in consideration of “value received” by himself and Scovell. Here is a sufficient consideration alleged. The notes of Scovell are ex- . pressed to be for “value received,” and these notes, with this consideration upon their face, are guarantied by the defendant- The consideration of his promise was this value received, and it was sufficient to uphold both contracts. This has been expressly decided : and these counts are fully supported by adjudged cases.. [11 J. R. 221. 13 J. R. 175.]

The consideration of value received, is not inconsistent with: that of goods sold; for the latter may, in fact, be the exact consideration embraced by the former ; and in this view of the' subject all the counts are good.

This is called a collateral undertaking, and, perhaps the use of that word may mislead us, if we suppose it contained in the statute of frauds. But, the act uses no such word. A contract may be collateral to another contract, and yet, original as to the party to be charged. His promise may be, to pay the debt of another, and yet, if made at the time of the principal contract, it is as much an original agreement, as the principal contract is. ¿Join this case, the defendant’s contract is original, although made to

p. 652

guaranty Scovell’s notes. The only question is, whether the promise is in writing: and, in this respect, we have complied with pne requirements of the statute.

The first and second counts of the declaration,

in this case, are substantially alike; and set forth, that the defendant, on the 5th of December, 1827, in consideration that the plaintiff would sell and deliver to one Scovell, a certain quantity of goods, &c., promised the plaintiff to guaranty to him the payment of certain promissory notes, made by the said Scovell to the plaintiff, bearing date on that day. The delivery of the goods to Scovell, on the faith of the defendant’s promise, is set forth, with the proper averments, showing a breach of the promise, on the part of the defendant. To these counts, the defendant has pleaded, separately, that the said promise of the defendant was a special promise, to answer for the debt of Scovell; and that no agreement, in relation to it, in writing, wherein the consideration for such promise was shown, was ever signed by the defendant, or by any person authorised by him. The plaintiff replies, setting forth the written agreement, signed by the defendant, dated the 5th of December, 1827.

The replications then aver, that the consideration of the defendant’s promise, set forth in the 1st and 2d counts of the declaration, is expressed in the said agreement, and that the same is signed by him. To these replications, there is a separate and general demurrer. The question arising on this written guaranty, has been before us, in another action between these parties. The declaration, in that case, contained two counts, like those now under consideration. On the trial of the cause under the general issue, the plaintiff having proved the guaranty, the defendant demurred to the evidence, and we held that it did not support the declaration. We thought that the consideration of “value received” expressed in the copies of the notes, contained in the guaranty, might, on the authority of the case of Leonard v. Vredenburgh, [ 8 J. R. 29, ] be held to be the consideration for the guaranty itself, but that it did not appear to be the same consideration alluded to in the declaration; and w.e also held, that the plaintiff

p. 653

might shew, by parol proof, that the notes of Scovell, and the guaranty of the defendant, were, in truth, one original transaclion, and were both entered into upon the same consideration,, to-wit: the sale of the goods, &c. by the plaintiff to Scovell.

Applying the principles of that decision to the present case, E think that the plaintiff, to support his 1st and 2d counts, ought to show, in pleading, what, in that case, we held him bound: to-show in evidence. After setting out the written promise of the defendant, he should have averred, in substance, that the consideration of the promise, was, the sale of the goods, &c. to Scovell, and that the defendant’s guaranty, and the notes of Scovell were made at the same time, and constituted parts of the same agreement, in pursuance of which, the plaintiff parted with his property, and that averment he might support, on the trial, by parol proof.

The replications to the first and second pleas of the defendant, do not, therefore, in my judgment, support the first and second ■counts in the plaintiff’s declaration, and there must be judgment for the defendant on the demurrer to these replications.

The third count of the declaration states, that Scovell, on the 5th of December, 1827, made three promissory notes to the plaintiff, (setting them forth particularly,) and that the defendant, in consideration of value received by the said Scovell, and him, t he defendant,” promised the plaintiff to guaranty the payment of the notes, with the necessary averments as to the breach of the guaranty. The fourth count states, that in consideration of value received “by Scovell and the defendant,” for which Scovell made his promissory note to the plaintiff, (setting it forth,) the defendant promised to guaranty the payment of the note to the plaintiff. To these counts there are the same pleas, replications, and demurrers, as to the two first counts.

The third and fourth counts are substantially the same. The replications set forth a written promise of the defendant, signed by him, containing copies of the notes, to which the guaranty applies, and in which the notes are expressed to be for “value re- “ ceived.” In the case of Leonard v. Vredenburgh, the guaranty of the defendant was in the same form with that in the present

p. 654

case. A note expressed to be for “ value received,” was first signed by Johnson, and underneath was written the guaranty of Vredenburgh which contained no new or other consideration. In that case, the court say, that “ Johnson’s note given for value 6t recejve¿]) anc]3 0f course, imputing a consideration on its face, “ was all-the consideration requisite to be shown;” and the Chief Justice adds, “ if it was all one transaction,, the value received was evidence of a consideration, embracing both the promises: “ the writing imputed, upon the face of it, one original and entire “ transaction for a guaranty of a contract, and implies ex vi termini, that it was a concurrent act, and part of the original agree- “ merit.”'

It.is supposed by the plaintiff’s counsel, that the present case falls within the principles here laid down. I am inclined to think that it does not. The guaranty here, after setting forth copies of the notes, goes on to say, that in pursuance of the understanding and agreement- between the plaintiff and Scovell, the defendant stipulates to pay the notes, if S. does not. The guaranty, in terms, refers to some consideration arising out of the agreement between S. and the defendant, and excludes the inference, (which, perhaps, might otherwise be drawn,) that the ' value received, expressed .in the copies of the notes, was the consideration on which the defendant’s contract actually rested. If this be so, then the replications do not support the averments in the third and fourth counts of the declaration. The consideration of the contract declared on, is that of value received by the defendant and Scovell. The contract set forth in the replication does not appear, with sufficient certainty, to rest on the same consideration, and the replication mtist be considered bad for that reason.

Judgment for the defendant on the demurrers, with have to the plaintiff to amend his replications, on payment of costs.

[H. and E. Wilkes, Att’ys for the plff.