Wheelwright v. Moore — 2 N.Y. Super. Ct. 143

Majority

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John Wheelwright versus. John A. Moore.

Headnote

The defendant executed the following instrument of guaranty in favor of the plaintiff.

New-Yorlc, December 5Ih, 1827.

“ Whereas Noah Scovell of the City ofNew-York, has this day passed to John “Wheelwright of the said city, his three promissory notes, of which the folio w- “ ing are correct copies ; (setting forth the same ) “ amounting together to “ $10,590 and 80 cents ; now in pursuance of the understanding and agreement “ between the said John Wheelwright and the said Noah Scovell, I do hereby “ guaranty the just and full payment of the said notes to the said John Wheel- “ wright or his order, and should any default; of payment thereof be made by “ the said Scovell, I bind myself for the full amount of such default.” (Signed) John A. Moore.

The plaintiff proved that Scovell on the 25th of November, 1827, came to him for the purpose of purchasing a quantity of barilla, and offered to give the defendant as a surety. That he accepted the terms, sold the barilla to Scovell, and on the 4th of December following delivered a part of it to him. Scovell gave his notes to the plaintiff for the amount of the barilla, and about three hours after they were gvien, the notes and and guaranty wore presented to the defendant, who immediately executed the guaranty and delivered it to the plaintiff.

Held, that this was all one original and entire transaction, and that the sale and delivery of the goods to Scovell supported the promise of the defendant as well as the promise of Scovell, and formed a good consideration for both. Held, also, that the declaration (which counted on the promise as a collateral one,) being according to the fads of the case, was correct in its form, and in all respects sufficient.

Assumpsit, upon a guaranty, executed by the defendant.

The same case in substance, liad been before the Court oil two former occasions, once upon a demurrer (o the plaintiff’s evidence, [ Vol 1 ,p. 201.] and again upon a demurrer to the plaintiff’s replications to the defendant’s pleas. [Ib. 648.]

The declaration in the present instance contained two special counts; the first stating in substance, that on the 5tli day of December, A. D. 1827, in consideration that the plaintiff would, at

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the special instance of the defendant, sell and deliver to one Noah Scovell a large quantity of merchandise for the sum- of $10,590 and qq cents . ¿efen¿ant undertook and faithfully promised io guaranty to him, or his order the payment of three several promissory notes, bearing date respectively on the said 5th day of December; the first being for $3,530 and 27 cents, payable seven months after date: the second for $3,530 and 27 cents, payable in nine months after date, and the third for $3,530 and 26 cents, payable twelve months after date. It then averred the sale and delivery of the merchandise to Scovell for the above amount, payable in Scovell’s three several notes of the tenor above set forth, and that the, first note had become due, but was not paid by Scovell, whereby the plaintiff became liable, &c.

The second count differed from the first in nothing, except in confining the guaranty to the first note, the consideration being the same with that set forth in the first count.

Plea, the general issue. The cause was tried before Mr. Justice Oakley.

At the trial, the plaintiff’s counsel offered in evidence, the guaranty of the defendant, containing copies of Scovell’s notes exactly set forth in the declaration in the former case. [ Vol. 1 p. 202.] He then read the deposition of one Daniel McLaughlin, which stated^ “ that on the 25th day of November, 1827, Scovell went to the “ Compting House of the plaintiff, for the purpose of purchasing a “ quantity of barilla of him, and offered the defendant as a guaran- “ ty, for the payment of the same. That after making inquiry “ as to the “ stability ” of the defendant, the plaintiff on the 30th “ of November agreed to sell Scovell 242 tons ofbarilla for forty four “dollarsper ton, (amounting to $10,590 and 90 cents,) at a credit “ of seven, nine, and twelve months, ivith the defendant as a surety. “ That the witness (who was acting as bookkeeper to the plaintiff) “ then entered a memorandum of the sale in the plaintiff’s sales “ book, and the memorandum was immediately communicated to “ Scovell, who assented to it, and suggested that the word “ guar- “ ty” should be substituted for the word “ endorsed,” which the de- “ ponent had written. Afterwards, (but on what particular day, “ the witness did not recollect,) Scovell gave his three promissory

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“ notes to the plaintiff for the whole amount of the purchase mon- “ ey, and in about three hours after they were signed by Scovell, the “ witness carried them, together with the guaranty containing cop- “ ies of the notes to the defendant, who then executed the guaran- “ ty. Moore, the defendant was not in the compting room of the “ plaintiff, nor present at the time, when the agreement between “ him and Scovell was made.”

All that part of the deposition, which related to the transactions of Scovell and his conversations with the plaintiff at his office, was objected to at the trial by the counsel for the defendant; but the objection was overruled by the Judge.

The plaintiff then offered to prove, that the sale of a quantity of barilla formed the consideration of Scovell’s notes, and that a part of it was delivered to him on the 4th day of December, 1827. This evidence was objected to on the part of the defendant; hut the objection being overruled, the plaintiff proved the delivery of apart of the barilla to Scovell on the 4th of December, and also that it formed the consideration of the notes.

The plaintiff having shown that the note described in the declaration had become due, but xvas unpaid; the defendant’s counsel moved for a nonsuit, but the motion was denied by the Judge, A verdict xvas then taken in favor of the plaintiff, for $3,653 and 82 cents, to be considered as subject to a case, either party having leave to turn it into a special verdict or bill of exceptions.

A case having been made, the cause was now argued by Mr. /« JLnthon for the defendant, and by Mr. Wilkes for the plaintiff For the defendant it was contended

I. That the promise of the defendant as disclosed by the guaranty xvas collateral, and as such was declared on by the plaintiff. The consideration for the promise must therefore not only be in writing but must appear on the face of the instrument of guaranty. [Fell on Guar. p. 20, 21 [n). 2 D. ty E. 80. 8 John. Rep. 29 . 11 lb. 271. 4 lb. 281. 13 lb. 175.—In this case, the consideration so appearing, is there stated to be “ the understanding and agreement betioeen Wheelwright and Scovell.” This consideration is unintelligible without recourse to oral testimony, xvhich it was the

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express object of the statute of frauds to exclude. All parol testimony therefore to explain the consideration was inadmissible under the statute.

II. The parol testimony of the matters, which took place between Scovell Wheelwright, in the absence of Moore was upon every principle inadmissible.

III. Under the statute of frauds the written contract must speak for itself, and it contains the sole evidence of the terms, upon which the defendant consented to be bohnd. All the testimony therefore as to the consideration of Scovcll’s notes was inadmissible.

IV. The interval of time between the signing and delivery of the notes and the signing and delivery of the guaranty, takes the case out of that class of decisions, which, by reason of the simultaneous execution of the original and collal eral contracts, treat both as forming one original contract. [3 Bing. 107. 5 Mass. Rep. 358 . Hunt v. Adams, and the cases before cited.]

There is no evidence that the witness McLaughlin communicated to Moore the terms, upon which the plaintiff had agreed to receive his guaranty of Sco veil’s notes. There is therefore no connecting link between the plaintiff’s contract with Scovell and the consideration for the defendant’s promise ; nothing to show that there was but one transaction, and one consideration, passing among the parties.

In the case of Leonard v. Vredenburgh the parties were all together, when the note was given and endorsed, and the consideration furnished. So in the case of Bailey v. Freeman, and in that of Nelson v. Dubois, there was but one transaction. Here the promissory notes were first made and delivered : three hours afterward the defendant was applied to for his guaranty of the notes. Moore was not present when the original contract was made, but that was perfect and in esse, at the time the defendant was solicited to execute his agreement. This therefore was clearly a collateral contract, made subsequently to the original one, and is void for the want of a consideration.

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V. If the case falls within the class of cases referred to, the plaintiff has not treated it as such, he ought in that event to have declared upon it as an original and not a collateral contract. The plaintiff is in this dilemma: if he assumes the contract to be an original one, then he has no count in his declaration to meet it, Ifit is a collateral one, then there is no consideration to support it.

Mr. Wilkes, for the plaintiff.

The giving of the notes and the execution of the guaranty were concurrent acts, and one and the same transaction. " By the evidence of McLaughlin, the plaintiff has supplied, we think, what the Court considered upon the former trial as a defect in his proof. This evidence was clearly admissible, to show as part of the res gestee, that the giving of the notes by Scovell and the guaranty by the defendant were the same transaction and founded on the same consideration. Where the jury have found a verdict, subject to a case, every thing fairly inferable from the verdict is to be taken in favor of the successful party. Here we have a right to infer, for we think the jury Would have found, that the defendant knew perfectly well before the contract was made between Scovell and the plaintiff, that his guaranty would be required, because Scovell proposed to give this security, at the time when he asked for the credit.

After the terms of the contract between the original parties were digested, Scovell gave his notes to the plaintiff, who in pursuance of the agreement, sent his clerk immediately to the defendant for the purpose of obtaining the required security. The defendant, without hesitation and without inquiry signed the guaranty and delivered it to the plaintiff; under these circumstances, is it not fair to suppose that Moore had been made acquainted with the arrangements between Scovell and the plaintiff, and had assented to them all % The plaintiff would not have delivered the barilla on the 4th of December, if he had supposed that the giving of the guaranty by the defendant was subject to any contingency: on the contrary, he considered it as a part of the original contract, and so all the parties treated it. We therefore consider the fact as

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established, that the giving of the notes and the guaranty were all , one transaction.

II. The guaranty being an essential branch of the same transaction with the giving of the notes, it required no new or distinct consideration passing between the plaintiff and the defendant to support it; but it is upheld by the same consideration which supports the notes. [D’Wolf v. Rabaud et al. 1 Peters’ U. S. Rep. 477.] This is what is termed an original, collateral contract. It is original as to consideration, because made at the same time with the principal contract; but is collateral as to promise, because the faithful performance of another’s contract is guarantied. This distinction is well settled in our own Courts, and the law upon the subject is also well settled. The defendant relies upon the case of Wain v. Warlters, and the class of decisions in England following that case. The authority of that decision has been denied in Massachusetts, [ 17 Mass. Rep. 122 ,] and it has been questioned in.the Supreme Court of the United States. [D’ Wolf v. Rabaud, supra.] The principle of that case as admitted by our Courts, however, goes only to this point; that where the original debt was perfectly in esse, independent of the collateral one, and the collateral contract was afterwards superinduced upon the original one, then not only the contract itself, but its consideration, must appear in writing. In such case the original consideration cannot be the consideration of the collateral contract, but the latter must rest upon some new foundation. But here there could be no distinct consideration, for there never was but one, moving between the parties, and that was the credit given to Scovell.

III. The evidence offered at the trial was competent to explain atid ascertain what the agreement between Scovell and the plaintiff was, as referred to in the guaranty; it not being in contradiction, but in furtherance of it,

When this cause was formerly before us on a demurrer to the plaintiff’s evidence, we considered, that the case was defective, in not showing the consideration for the defendant’s prom

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ise, which the declaration alleged. The guaranty of the defendant was alone, in proof. That guaranty was written under copies of the notes made by Scovell, which purported to be for value received, and although we considered that a sufficient consideration to support the guaranty, yet it did not accord with the consideration set up by the declaration, which was the sale of goods by the plaintiff to Scovell at the defendant’s request: and we held, on the authority of the case of Leonard v. Vredenburgh, [8 J. R. 29.] that parol proof was admissible to show, that the actual consideration of the'defendant’s promise, was the sale of goods to Scovell at his request.

In the case, as it now presents itself, it is sufficiently proved, that previous to the giving of the notes by Scovell, he applied to the plaintiff to purchase the goods in question, and offered the defendant as his surety; th at the plaintiff agreed to sell the goods upon the guaranty of the defendant for the payment; that the notes of Scovell were signed by him ; and the agent of the plaintiff about three hours after they were so signed, called with them on the defendant; that copies of the notes were made, and the guaranty of the defendant written under the said copies. The goods sold were partly delivered to Scovell on the day preceding the date of the notes ; and the guaranty is stated to have been made in pursuance of the agreement and understanding between the plaintiff and Scovell.

The facts in this case show with sufficient clearness, that the promise of the defendant to guaranty the payment of the notes was a part of the original negotiation between the plaintiffs and Scovell; that the defendant must have understood the nature of that negotiation, and that the plaintiff had agreed to part .with the property, on the security of his guaranty. ' The sale and guaranty, therefore, in the language of C. J. Kent, in Leonard v. Vredenburgh, were all one original and entire transaction, and the sale and delivery of the goods to Scovell supported the promise of the defendant as well as the promise of Scovell. The case seems to fall directly within the principles of Leonard v. Vredenburgh, and of Nelson v. Dubois, [13 J. R. 175.] which latter case is very similar, in all respects, to the present. The case of Bailey & Bo

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gert v. Freeman, [11 J. R. 221] is also in point, and is also similar to the present.

The interval of time which elapsed between the signing of the notes and of the guaranty, does not destroy the entirety of the transaction. Both acts were done in pursuance of the original agreements, and the one must necessarily have preceded the other. The contract made with Scovell was not past and completed, until the guaranty was given by the defendants. In Bailey fy Bogert v. Freeman, the guaranty was signed at a different time and place from the original agreement. There is no foundation for the objection to the form of the declaration. It is strictly according to the facts of the case, and agrees in all respects with the declaration in the case of Nelson v. Bubois. The plaintiff is entitled to judgment.

Judgment for the plaintiff, on the case made.

[H. & E. Wilkes, attys. for the plff.