Reigart v. White

The opinion of the court was delivered, June 1st 1866, by

Agnew, J.

The letter of Mrs. Reigart of September 20th 1860 is a direct and special contract of security to White & Swope for the delivery of the nails by Emory, and not a general guaranty. It would be difficult to define the commercial contract of guaranty so clearly as to reconcile all the adjudged cases lying upon the confines between guaranty and suretyship.

But there is one element in the former to be found in all guaranties which seldom fails as a mark of distinction, and this is well expressed by Lewis, O. J., in Brown v. Brooks, 1 Casey 210, where he says a guaranty is an engagement to pay in default of solvency in the debtor, provided due diligence be used to obtain payment from him. This affords, perhaps, the best solution of the difference; a contract of suretyship being a direct liability to the creditor for the act to be performed by the debtor, and a guaranty being a liability only for his ability to perform this act. In the former the surety assumes to perform the contract of the principal debtor if he should not, and in the latter. the guarantor undertakes that his principal can perform; that he is able to do so. Erom the nature of the former the undertaking is immediate and direct that the act shall be done, which if not done, makes the surety responsible at once, but from the nature of the latter, non-ability (in other words, insolvency) must be shown. How insolvency shall be shown it is unnecessary here to state, but it follows from what we have said of Mrs. Reigart’s assumption that it was not necessary to be proved in this case, and therefore the error assigned upon the bill of exception on this point is unimportant. The manner of showing insolvency will be found discussed in many cases: Kirkpatrick v. White, 5 Casey 176; Gilbert v. Henck, 6 Casey 205.

The case last cited is relied on by the plaintiff in error to show that this is a case of general guaranty. Cf Gilbert v. Henck it may be remarked that it stands on the very confines, if at all within the contract of guaranty as commercially and legally understood. It was an action for rent upon a covenant endorsed upon a lease and signed by the defendants, in which they agreed to be responsible for the true and faithful performance of the contract on part of the lessees. The opinion of the learned judge in that case refers to no authorities and gives no reasons, simply stating that the writing was a guaranty. The ease of Sherman v. Roberts, 1 Grant 261, decided only three years before, is almost in direct antagonism; while in Allen v. Hubert, 13 Wright 259, Gilbert v. Henck is directly referred to as unnecessarily deciding the question of guaranty, and as leaving Marberger v. Potts, 4 Harris 9, unshaken. In Marberger v. Potts the language was: — “ I hereby acknowledge to be security for the within amount of $500 until satisfactorily paid by William Audenried.” In substantial meaning that case cannot be distinguished from the one now before us, excepting that ours is, perhaps, a stronger instance of direct and immediate liability, as I shall presently show. Justice Coulter there very clearly points out the distinction between an absolute contract of suretyship and the conditional liability of guaranty. In Allen v. Hubert the words were: — “ For consideration received I hereby agree to become security for the faithful performance of the above agreement.” In his opinion our brother Strong says this was an undertaking of suretyship rather than of technical strict guaranty. In Amsbaugh v. Gearhart, 1 Jones 482, it was held that the words endorsed on a note, “ I will see the within paid,” is not a guaranty, but a direct liability to pay. So in Campbell v. Baker, 10 Wright 243, the assignment of a note with “ a guaranty of payment of the sum when due,” it was held by the same judge, delivering the opinion in Gilbert v. Henck, not to be a general guaranty. He says the guaranty is special in such a case, and broken by nonpayment at maturity.

Testing the present case by these principles and authorities, it has no shadow of guaranty cast upon it. Emory had endeavoured to effect purchases of goods in Baltimore, to be paid for in nails, on four months’ credit. His merchants were unwilling to trust him without security, and declined delivering the goods. Mrs. Reigart then wrote her letter of September 20th 1860, addressed directly to the'merchants themselves, in which she says, in case they have not shipped the goods, “ to ship immediately, and she will be responsible to them for the delivery of the nails as agreed by Emory.” Thus it will be noticed that security was the demand, and the goods remained undelivered; that Mrs. Eeigart, writing from Blair county, Pennsylvania, requested an immediate delivery in Baltimore, which was, from the nature and locality of the act, to be done without further notice, and operated as an immediate acceptance by her own authority of her offer of security. Then by her contract she agreed to become responsible for the delivery of the nails at four months, not for the ability of Emory to deliver them. Upon the whole case the judgment must be affirmed.

Judgment affirmed.