Appleford v. Snake River Mining, Milling & Smelting Co.

210 P. 26, 122 Wash. 11, 29 A.L.R. 268, 1922 Wash. LEXIS 1105
CourtWashington Supreme Court
DecidedOctober 21, 1922
DocketNo. 17062
StatusPublished
Cited by25 cases

This text of 210 P. 26 (Appleford v. Snake River Mining, Milling & Smelting Co.) is published on Counsel Stack Legal Research, covering Washington Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Appleford v. Snake River Mining, Milling & Smelting Co., 210 P. 26, 122 Wash. 11, 29 A.L.R. 268, 1922 Wash. LEXIS 1105 (Wash. 1922).

Opinion

Bridges, J.

— Suit by one guarantor for contribution from his co-guarantors, and for judgment against the original debtor.

On September 11, 1915, the defendant Snake River Mining, Milling and Smelting Company, a corporation, gave one Baumeister its two written promissory notes, each for $4,025.80, each falling due one year after date, each drawing ten per cent interest and providing for an attorney’s fee. At the time the notes were executed, and before they were negotiated, the defendants J. W. Rogers, C. A. Rogers, W. D. Rogers, S. S. Rogers, J. O. Tuttle and George Appleford, in writing, on the back of each note, guaranteed the payment in the following words: “For value received I hereby guarantee the payment of the within note, and any renewal of the same, and hereby waive protest, demand and notice of non-payment thereof.” Subsequently [13]*13Mr. Appleford died and the plaintiff was duly appointed the administrator of his estate, and as such maintains this suit. During the course of the administration of the estate, the two notes given hy the corporation came due and were not paid, and the owner and holder thereof presented a claim therefor against the estate of Mr. Appleford. The administrator, under the order of the court, allowed and paid the claim in a sum in excess of $11,000, such amount being the principal and interest thereon to March 12,1919, that being the date of the payment. The administrator thereafter commenced this suit against the maker of the notes and all of his co-guarantors to recover judgment for the amount of the notes, plus interest and attorney’s fee, as against the former, and to recover contribution against the latter.

The trial court made findings and conclusions in favor of the plaintiff. It found the facts substantially as we have related them, and also found that, at the time the plaintiff paid the notes, they were assigned and delivered to him, and that he was the owner and holder thereof at the time the suit was instituted. The findings were further to the effect that the maker of the notes was indebted to the plaintiff in the sum of $11,068.40, together with interest thereon at the rate of ten per centum per annum from March 12, 1919, that being the date the administrator paid the notes, and also found that $400 was a reasonable attorney’s fee in the action. Based upon these findings and conclusions, the court entered a decree giving judgment to the plaintiff against the corporation making the notes, in the sum of $11,068.40, with interest thereon at the rate of ten per cent per annum from March 12, 1919, and an attorney’s fee of $400, and the decree further gave a judgment against the defendants who were co-guarantors on the note

[14]*14“for their share of contribution toward the payment of said notes after the assets of the Snake River Mining, Milling and Smelting Company in the state of Washington have been exhausted by execution and sale according to law, so that each guarantor defendant and the plaintiff as guarantor shall be compelled to contribute his share equally in making of the amount of their respective liabilities on said notes, and if any guarantor defendants, or defendants are insolvent and have not sufficient property or assets subject to execution to satisfy the amount of contribution from each guarantor defendant, then plaintiff shall recover and shall be entitled to have execution issued against each solvent guarantor defendant, so that each solvent guarantor defendant and the plaintiff as guarantor shall be compelled to contribute his share and satisfy his liabilities due on said notes, and that execution may issue against each solvent guarantor defendant who has assets subject to execution until each solvent guarantor defendant has contributed the amount of his liabilities on said notes to said plaintiff.”

The judgment also determined that the defendant Tuttle had an offset of $2,432.41 against the judgment thus rendered against him. All of the defendants have appealed.

We take it that the effect of the decree is to give judgment against the corporation for the whole amount paid by the plaintiff, together with interest at ten per cent and attorney’s fee, and that each solvent defendant guarantor should be required to contribute his just portion of such amount of the judgment as shall remain after the assets of the maker of the note have been exhausted, and that if the sheriff is unable to make out of any one or more of the defendant co-guarantors the amount he should pay, then that amount should be made up by each one of the solvent co-guarantors, and that the co-guarantors shall pay [15]*15ten per cent interest on the amount thus required to be paid, plus $400 attorney’s fee.

The doctrine of contribution among sureties or guarantors is based upon the equitable principles that, where several parties are equally liable for the same debt and one is compelled to pay the whole of it, he may have contribution against the others to obtain from them the payment of their respective shares. The doctrine is founded on an implied rather than an expressed contract. The right to contribution is not based upon the instrument on which the guarantors have become liable, but is based upon the idea that, when the guarantors signed such instrument, they impliedly agreed that if there should be any liability each would contribute his just portion. The mere fact that a right of contribution exists, necessarily implies that the instrument out of which the liability grows has been paid and extinguished by one for the benefit of all. Six R. C. L. 1036 et seq; 13 C. J. 825 et seq; Brandt, Suretyship and Guaranty, vol. 1 (3d ed.), § 279 et seq. One co-guarantor who has paid the guaranteed indebtedness may not arbitrarily collect from one of several co-guarantors but he is required to collect equally and ratably among those who are solvent. If some of the guarantors are insolvent, then those who are solvent will be required to pay their portion of the amount which the insolvent guarantor would otherwise have been required to pay. Brandt, Suretyship and Guaranty, vol. 1 (3d ed.), §314 et seq; 6 R. C. L. 1037 et seq; 13 C. J. 825; Gross v. Davis, 87 Tenn. 226, 11 S. W. 92, 10 Am. St. 635; Surety Co. v. St. Paul Fire & Marine Ins. Co., 50 Conn. 233; Petten v. Richardson, 68 Mo. 379; McAllister v. Irwin’s Estate, 31 Colo. 253, 73 Pac. 47; Stockwell v. Mutual Life Ins. Co., 140 Cal. 198, 98 Am. St. 25, and note. While the gen[16]*16eral principles governing contribution are well settled, there is very little authority on the procedure, particularly where some of the co-guarantors are insolvent.

(1) The appellants first contend that it was error to make the guarantor defendants parties to the action, because the pleadings and the testimony show that, when the plaintiff administrator paid the notes, he took an assignment of them, and that his suit should have been upon the notes and only against the maker. We cannot sustain this contention. The mere fact that he took an assignment of the notes does not deprive him of his right to require contribution, because, as between the guarantors, the indebtedness has been paid and satisfied and the right to contribution because thereof exists. Pioneer Mining & Ditch Co., v. Davidson, 111 Wash. 262, 190 Pac. 242; Boutin v. Etsell, 110 Wis. 276, 85 N. W. 964.

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Bluebook (online)
210 P. 26, 122 Wash. 11, 29 A.L.R. 268, 1922 Wash. LEXIS 1105, Counsel Stack Legal Research, https://law.counselstack.com/opinion/appleford-v-snake-river-mining-milling-smelting-co-wash-1922.