Eneas v. Hoops — 42 N.Y. Super. Ct. 517

Majority

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JOSEPH ENEAS, Plaintiff and Respondent, v. HERMAN F. HOOPS, Defendant and Appellant.

Headnote

I. GUARANTY.

1. GUARANTOR, CHARGING.

(a) Demand of payment from principal, and notice to guarantor not necessary when the guaranty is absolute: e. g., when the guaranty is as follows:

“For and in consideration of the sum of one dollar, I hereby guarantee the payment of invoice of cargo covered by within contract. ”

2. GUARANTOR, DISCHARGING.

(a) Alteration op contract guaranteed.

1. An alteration or variation, materially affecting the contract guaranteed, will discharge the guarantor.

(a) Advantage to guarantor. This although the variation may be to his advantage.

2. Examiple of alteration discharging guarantor.—The guaranty was of the payment of the purchase-price of a cargo of nuts agreed to be sold and delivered. A subsequent agreement, made without the consent of the guarantor, that the vendee need not take the deck-load (if under the term cargo, used in the guaranteed contract, the vendee was bound to take the deck-load), will discharge the guarantor.

H. CUSTOM.

1. Words and phrases in a contract, custom admissible to show the sense in which they were used, when.

(a) Trade Words. The sense which words have acquired in the trade with regard to which they are used, may be shown by usage.

1. Ambiguity, art, science, &c. It is not necessary that the word or phrase should be at all ambiguous on its face, or relate to an art or science.

III. CARGO.—DECK-LOAD.—FRUIT.

1. The term cargo may be shown by the usage of the fruit trade to exclude the deck-load, when it is used in reference to that trade.

IV. EVIDENCE.

1. Estimation, when inadmissible.

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(a) An estimate made on a part of a whole does not necessarily furnish a basis for a calculation as to whole, based on such estimate.

1. Therefore, an offer to prove by a witness (an expert), that he had estimated the number of culls in a part of a cargo, and that he could estimate such percentage with accuracy, with the view of^showing the percentage of culls in the whole cargo, was properly excluded.

Before Sedgwick and Speir, JJ.

Decided June 25, 1877.

Appeal from a judgment for §7,500 rendered on a verdict for the plaintiff, and also from an order denying a new trial.

The plaintiff and Joseph Heron, on May 11,1875, in New York made this agreement: “ I have this day bought of Joseph Eneas, the cargo of cocoanufcs on board the schooner ‘Win. R. Knighton,’ now here, for forty dollars per thousand, as they run, throwing out cracks and rots only. The cargo to be of prime, merchantable quality, culls not to exceed ten per cent,. Ten working days to discharge. I am to furnish one man to count and .select with his man, and to sign receipts for them as they are delivered. He to pay the man for his time. Cargo bought on four months time, to be paid for by my note, for one-half of whole amount, at four months, indorsed by Hoops ; the balance to be paid for on or before the expiration of four months. Interest at the rate of seven per cent, per annum to be allowed for the unexpired term.

(Signed) Joseph Heron.

Joseph Eneas.”

The following guaranty was executed and indorsed by the defendant on the foregoing agreement: “ For, and in consideration of the sum of one dollar, I hereby guar

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antee the payment of invoice of cargo covered by within contract.

(Signed) H. F. Hoops.”

Townsend & Mahan, attorneys for defendant; H. B. Townsend, of counsel.

Wm. W. Goodrich, attorney and counsel, for plaintiff.

The action is brought upon the guarantee executed by the defendant after the expiration of the term of credit provided for by the agreement. It is in evidence that after the above credit had expired the plaintiff commenced an action, and recovered a judgment against Heron for the same amount as was recovered in this action, and notice of pendency of that action was given to the defendant herein, who was a witness at the trial. The guaranty in the case is absolute, and did not require any preliminary demand of payment upon the principal debtor, and notice of non-payment. Hor does it appear that the omission of such demand and notice has been the occasion of any injury to the defendant. The defendant made no stipulation for notice to him as guarantor in any event. The points made in these respects by defendant’s counsel may therefore be disregarded.

The terms of the contract of guaranty must be strictly complied with, or the guarantor will not be bound, and any subsequent alteration at all materially affecting the principal contract made without his consent discharges him.

The cases go to the extent of holding that although sucli variation may be to the advantage of the surety, yet it releases such surety from all liability on his contract. It is not a question whether he is harmed by a deviation to which he has not assented (Barnes v. Barrow, 61 N. Y. 39 ). He has the right to prescribe

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the exact terms upon, which he will enter into the obligation, and in case of variance to avail himself of the technical objection that it is not his contract.

The defendant claims that there was a revocation of the agreement between the plaintiff and Heron. That by it the deck-load, consisting of about ten of twelve thousand eocoanuts, was excluded from the operation of the contract. That under the contract as originally made, the plaintiff was bound to deliver, and Heron was bound to receive, the whole of the cargo, including the deck-load, and that subsequently it was agreed without the defendant’s assent that Heron need not take the deck-load. The learned judge, admitttéd ,the legal proposition, and charged the jury that, if this was so, such subsequent agreement amounted to an alteration of the contract guaranteed, and the guarantor was discharged.

The plaintiff introduced certain evidence tending to show a custom in the city of Hew York, and on the exchange, by which in the fruit trade deck-load was not included as part cargo. It is clear, if such custom can be maintained there would be no variation in the contract between the plaintiff and Heron. By excluding the deck-load from the contract, the legal consequences flowing from the foregoing proposition would be avoided.

The introduction of the evidence of custom was opposed upon the ground that the term cargo is neither a technical or professional term, or a word having any significance in any art, business, trade or calling different from its ordinary accepted use. In short, that the word has a definite well-known meaning.

The custom should be reasonable, as growing out of the exigencies and conveniences of commerce and trade. The point is, are the words or phrases of a written contract to be understood in that sense which they have acquired in the trade with regard to which they are

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used. In Myers v. Earle (3 Q. B. 20, November, 1860, 30 L. J. 9), the court say, “I do not think that in order to introduce this extrinsic evidence, it is necessary that the phrase itself should be at all on the face of it ambiguous.” In Houghton v. Gillut (7 Car. & P. 701), the word “ cargo” received a mercantile construction, as applicable to that case. Nuts, like most articles in the fruit trade, are exposed to the vicissitudes of weather, and cannot be so well preserved as when conveyed under the deck. In this case Herron refused to accept the deck-load. The court instructed the jury that, inasmuch as there was a conflict of evidence on the question whether such a custom prevailed, it was for them to determine the fact.

The defendant offered to show by an expert witness, that he estimated the number of culls in a part of the lot which was to be sent to auction, and that he could estimate such percentage with accuracy. This was properly excluded. It did not follow that the percentage on the whole cargo could be ascertained by a calculation of the percentage on a portion of it. It was shown that in that part of the cargo received by Herron there were 17,050 culls, and' there were only 6,364 left in the whole remaining part which were sold at auction. In other words, 238,363 nuts were sold and delivered, and the culls, as stated in the receipts, were 23,414, which is less than ten per cent.

It is claimed by the defendant that the cocoanuts, excluding rots and cracks, were not prime and merchantable. The contract of warranty was “ $40 a thousand as they run, throwing out cracks and rots only, the cargo to be of prime, merchantable quality, culls not to exceed ten per cent.” It is to be observed that this is a warranty with a qualification. The important fact to be determined relates to the percentage of the culls on the whole cargo. It has already been shown that they did not contain more than ten per cent.

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Eneas and Herron, by agreement, each appointed a counter to select and throw out all cracks and rots, in order that the nuts which they both selected as sound should be delivered to Herron. They were duly receipted for until he refused to receive any more. This was an acceptance of the goods by Herron, so far as cracks and rots were concerned. Under all the facts and circumstances, and in view of all the evidence, the question was left for the jury to determine whether there was a breach of the warranty as to the prime and merchantable quality contemplated by the principal contract.

The requests to charge are embraced in the motion to dismiss, except two, which were charged by the court.

The judgment and order must be affirmed with costs.

Sedgwick, J., concurred.

Cases cited

Barns v. Barrow 61 N. Y. 39 N.Y. Comm'n App. p. 519