Fidelity & Deposit Co. v. Buckley

The plaintiffs at the defendant's request became surety for him. If as such surety they should be compelled to pay anything, they could as matter of law recover the amounts so paid of the defendant, whether he did or did not expressly agree to repay them. But in his application for a bond, in which he requested them to become surety for him, which has been made a part of the case, he expressly agreed to reimburse them for all expense that might be occasioned them by assuming that relation. "The contract stated is one of indemnity, in which cases it is usual to afford redress by a decree for specific performance." Batchelder v. Wendell, 36 N.H. 204,213. "Courts of equity will decree the specific performance of a general covenant to indemnify, although it sounds in damages only, upon the same principle that they will entertain a bill quia timet." 2 Sto. Eq. Jur., s. 850; Champion v. Brown, 6 Johns. Ch. 398, 406; Shockley v. Davis,17 Ga. 177, — 63 Am. Dec. 233; Michigan State Bank v. Hastings, 1 Doug. (Mich.) 225, — 41 Am. Dec. 549; Ranelaugh v. Hayes, 1 Vern. 189. See Sanders v. Insurance Co. 72 N.H. 485, 501.

Ranelaugh v. Hayes was a bill for the specific performance of a covenant to save harmless. The case was compared to a counter-bond, "where, although the surety is not troubled or molested for the debt, yet at any time after the money becomes payable on the original bond, this court will decree the principal to discharge the debt, it being unreasonable that a man should always have such a cloud over him." The defendant's agreement in writing in the following terms, "I do hereby covenant, promise, and agree . . . to reimburse the said company for any and all loss, costs, charges, suits, damages, counsel fees, and expenses of whatever kind or nature which said company shall or may, for any cause, at any time sustain, or incur, or be put to, for, or by reason, or in consequence of said company having entered into or executed said bond," is a counter-bond or agreement of indemnity expressed in terms of great comprehension. The bond has been forfeited, i.e., the penal sum has become due, and payment has been demanded. In such case it is not necessary that the sureties should first pay the debt. They are entitled to have the indemnitor pay his own debt and thereby save them harmless.

No amendment of the bill is necessary. The allegations that the plaintiffs are surety for the defendant, that the debt has become due and payment has been demanded, which the defendant has neglected to make, authorize a decree requiring him to perform his obligation, in the absence of any facts tending to show that such a decree would be inequitable. Norris v. Clark, 72 N.H. 442. The facts that the defendant after this bill was brought conveyed to his wife the real estate which he claimed to own when he applied the bond, and, contrary to the fact, claimed in this suit that he did not own, and that he owns no other real estate, tend to suggest the possible futility of any remedy at law. The real estate in controversy is attached in this suit to secure the performance of any orders that may be made therein. The order suggested will give the plaintiffs complete relief, without resort to the circuitous method of requiring the defendant to mortgage to them. It therefore seems unnecessary at this time to consider whether a decree could be made requiring the defendant to mortgage the described real estate, or, since he owns no other, what would be the same in effect unless the premises are divisible, to mortgage sufficient real estate to indemnify the plaintiffs.

Decree for the plaintiffs.

All concurred.