Cahill Iron Works v. Pemberton ( 1900 )

Willard Bartlett, J.:

Two causes of action are set out in the complaint, but it is only necessary to consider the second of these, inasmuch as the complaint was dismissed as to the first cause of action at the conclusion of the trial, and the plaintiff has not appealed.

On April 22,- 1891, at Chattanooga, Tenn., the Kensington Land Company executed and delivered to the plaintiff its promissory note whereby for value received it promised to pay to the order of the Cahill Iron Works $608.50, ninety-eight days after date.

On the same day at the same place the defendant, acting individually but using the firm name of F. R. Pemberton & Co., executed and delivered to the plaintiff a written guaranty of the payment of the aforesaid note in these words :

“ Chattanooga, Tenn., April 22nd, 1891.

“ The Cahill Iron Works, Chattanooga, Tenn. :

“ Dear’ Sirs.— Referring to the note of the Kensington Land Company in your favor for six hundred and eight and 50/100 ($608.50) dollars dated April 22nd, 1891, ninety-eight days after date, and due July’24th, 1891, we beg leave to say that we will guarantee the payment of said note at date of its maturity.

“ Very respectfully,

“ F. R. PEMBERTOE & CO.”

The note was not paid at maturity, and the plaintiff corporation, which was the payee, seeks by the second cause of action set out in the complaint to enforce the defendant’s liability on the guaranty.

The principal question involved in the appeal relates to the consideration for the guaranty. The allegation in the complaint on that subject is that on the 22d day of April, 1891, the Kensington Land Company was indebted to the plaintiff in the sum of $608.50, <c and in consideration that the plaintiff would extend the time of payment of said indebtedness and accept the ninety-eight day note of said land company in payment thereof, the defendant at said city of Chattanooga agreed to and with the plaintiff tó give to the plaintiff his written guaranty of the payment of said note at maturity.”

When the case came to trial, however, the plaintiff proved .a different consideration for the note and guaranty from that alleged in the complaint.. Evidence was given from which the jury were authorized to find that after the Kensington Land Company had pxirchased one bill of goods the defendant, who was the president of the company, told Mr. Frank H. Caldwell, the president of the plaintiff corporation, that he wanted to buy another bill of goods for the land company. According to Mr. Caldwell’s testimony Mr. Pemberton told him that he would j>robably want to give a ninety-day note for the new bill and also for the bill that was then due. Mr. Caldwell told Miv Pemberton that that would be all right if he would indorse the note; to which Mr. Pemberton responded that he would give his personal guaranty — the guaranty of the firm of F. R. Pemberton & Co. — that the notes would be paid when due. Mr. Caldwell answered that he would accept the guaranty, which would be just as good as an indorsement; and.he distinctly asserted on the witness stand that it was not before the first bill was sold but before the second bill was sold that this arrangement was made. The second bill was the purchase represented by the note for $608.50, the payment of which is guaranteed by the instrument of April 22, 1891, already set out in full in this opinion.

The effect of the testimony' of Mr. Caldwell, taken as a whole, was to show that the consideration for the note and guaranty, which were executed and delivered concurrently, was the sale to the plaintiff corporation of the second hill of goods mentioned in the conversation between him. and Mr. Pemberton.

No objection was taken to .this evidence on the ground of variance, or because it did not accord with the allegations of the complaint ; nor was any motion made to strike it out because not within the issues. “ It is settled that when one seeks to enforcé the rule that facts proven in the case are not available unless they are pleaded^ lie must take this position at the trial, and, if the objection to the proof of the facts is not put upon that precise ground at the trial, it ■cannot be taken advantage of at any later time.” (Eastwood v. Retsof Mining Co., 86 Hun, 91, 95; affd., 152 N. Y. 651.) It is manifest from the language of the charge that the learned trial judge understood the effect of the testimony to be precisely as we have stated it; for he said to the jury : “ You have heard the plaintiff’s witness tell us that he sold goods to the Kensington Land Company for $608.50 and that Mr. Pemberton agreed that if he would make that sale he would'guarantee the payment of the note which the plaintiff’s witness said that he would take from the Land Company for the money.” The guaranty was then read, and the jury were instructed that if they believed the evidence in behalf of the plaintiff with respect to this matter they should find a verdict in its favor. No exception was taken to the charge; and in view of the manner in Which the case was left to the jury, they must have found that the consideration for the note and guaranty was the second sale of goods.

In the case of Erie Country Savings Bank v. Coit (104 N. Y. 532), Judge Andrews thus stated the rule which controls the determination of the present appeal: “ Where a contract of guaranty is entered into concurrently with the principal obligation, a consideration which supports the principal contract supports the subsidiary one also We understand this to be the settled doctrine. (McNaught v. McClaughry, 42 N. Y. 22; Simons v. Steele, 36 N. H. 73 ; Brandt on Suretyship, §§ 6, 7.) And the consideration need not be expressed in the guaranty, but may be shown by parol. (Evansville Nat. Bank v. Kaufmann, 93 N. Y. 273.) ” This rule demands an affirmance of the judgment. The case at bar is radically distinguishable from those in which the guaranty is an engagement that the debtor will thereafter pay to the creditor a pre-existing debt. Such was the guaranty in Barney v. Forbes (118 N. Y. 581), upon which the appellant places much reliance. The contract of guaranty here was made at -the same time that .the original indebtedness was incurred and when the principal obligation was given.

Judgment and order affirmed, with costs.

All concurred.

Judgment and order affirmed, with costs.