Colby v. Farwell ( 1901 )

The verdict of the jury closes the question as to the availability to the plaintiff of the mortgage security; and the utter insolvency of the maker of the guaranteed note being admitted, the sole question raised by the case is whether the plaintiff was bound to first proceed against the maker and the security as a condition precedent to the enforcement of the guarantor's liability. We are of opinion that he was not.

The guaranty sought to be enforced was one of collection, and as such it constituted an undertaking on the part of the guarantor to pay the mortgage debt if, upon maturity, payment could not by reasonable diligence be obtained from the debtor or from the mortgage. So far the authorities are uniform; but what constitutes reasonable diligence in such a case is a question upon which the authorities are conflicting, it being held in some jurisdictions that such diligence requires the prosecution of the debtor and of the security to execution and return of nulla bona, and that his insolvency, or the worthlessness of the security, is no excuse for a failure to prosecute (Craig v. Parkis, 40 N.Y. 181; Salt Springs Nat'l Bank v. Sloan, 135 N.Y. 371; Bosman v. Akeley, 39 Mich. 710; French v. Marsh, 29 Wis. 649; McNall v. Barrow, 33 Kan. 495, 496; Roberts v. Laughlin, 4 No. Dak. 167), while in other jurisdictions it is held that if the debtor be so utterly insolvent, or the security so obviously valueless, that an action against either would manifestly be fruitless, the holder of the guaranty may resort to a suit upon it without first instituting proceedings against the one or the other. Camden v. Doremus, 3 How. 515, 533; Gillingham v. Boardman, 29 Me. 79, 82; Dana v. Conant, 30 Vt. 246; Sanford v. Allen, 1 Cush. 473; Cady v. Sheldon, 38 Barb. 103, 111, 112; McDoal v. Yeomans, 8 Watts 361; McClurg v. Fryer, 15 Pa. St. 293; Jones v. Ashford, 79 N.C. 172, 176; Stone v. Rockefeller, 29 Ohio St. 625; Brackett v. Rich, 23 Minn. 485; Dewey v. Investment Co., 48 Minn. 130, 134; Fall v. Youmans, 67 Minn. 83.

The latter doctrine we take to be the true one. "The law requires no man, in the pursuit of his rights, to do a vain and futile thing, useful to nobody, and hurtful to himself by the needless expense and trouble it would impose." McClurg v. Fryer, supra; Haven v. Haven, 69 N.H. 204, 205; Lyman v. Railroad, 66 N.H. 200, 203. See, also, Beebe v. Dudley, 26 N.H. 249; Dearborn v. Sawyer, 59 N.H. 95, 97; Howland v. Currier, 69 N.H. 202, 203.

Exceptions overruled.

WALKER, J., did not sit: the others concurred.