Knight v. Waters , 15 Iowa 420 ( 1863 )

Baldwin, Ch. J.

Two questions are raised by the defendant’s demurrer: 1st. Whether the facts stated in the petition show a breach of the bond ; and 2d. Whether the plaintiff can maintain the suit in this own name. In other words, can the defendants in this suit claim that because the judgment in favor of Levi, against the other members of the firm, was reversed, that Waters is released upon his bond, notwithstanding the fact the judgment against him was affirmed. It does not appear that any objections were raised by Waters, in the Levi suit, as to the right .of Levi to compel Waters to account for the amount of his indebt- • edness to the firm, or to(obtain a judgment for the amount due the said firm. This suit of Levi’s was of a twofold character: to settle the partnership, and to recover for the firm the amount due from Waters. Two appeals were taken, one by Waters, and the other byKarrick and Jones. Waters did not appeal to contest the right of the partnership, or of Levi, for them, to recover, but the amount of the indebtedness was the burden of his complainjt. ' It will be recollected that the suit of Levi against his partners was of an equitable character, and to settle the rights of the partners. ■ The Court had the power to render such judgment as it thought right and proper, either for or against any of the partners.. It was for a debt due the firm that the judgment against Waters was rendered. The Court had also the power to direct to whom Waters should pay. While, therefore, the bond was given to Levi by defendants, it was to secure a debt due the firm, and either partner was interested in Waters’ appeal, • If it was found, on appeal, that Waters was indebted to the firm, it made no difference to him to which partner it directed him.to pay the judgment, as this order or judgment, if paid, would be a bar to the right of either member of the firm to again recover.

The counsel of appellee are correct in their position, that the rights of sureties should be strictly guarded and that in case of doubt, the construction of bonds should be favorable to the obligor. At the same time the real intention of the parties must control such construction, if it can reasonably be arrived at from the reading of the contract in connection with, the surrounding circumstances. The condition of the defendants’ bond was to pay any judgment rendered against Waters in the cause of Levi v. Karrick and Jones, in the Supreme Court. The. reversal of the judgment in favor of Levi did not change Waters’ rights in the least. It made him none the more or less liable to the firm. The judgment against him was affirmed, and the order of the Court, directing his judgment to be paid to the members of the firm, orto the plaintiff, as their receiver, does not prejudice his rights or that of his sureties.

The demurrer should have been overruled.

Reversed.