Craft v. Isham

13 Conn. 28
CourtSupreme Court of Connecticut
DecidedJuly 15, 1838
StatusPublished
Cited by25 cases

This text of 13 Conn. 28 (Craft v. Isham) is published on Counsel Stack Legal Research, covering Supreme Court of Connecticut primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Craft v. Isham, 13 Conn. 28 (Colo. 1838).

Opinion

Bissell, J.

The case depends on the propriety of the direction of the judge to thejury. It has been elaborately discussed before us, and now remains for our decision.

It may here be remarked, that the judge did not place the [32]*32case on the around, that no notice of the acceptance of the was given to the defendant, but on the single ground that he was not notified within a reasonable time, of the advances made under the guaranty, and for which he was held to be liable. It being, however, admitted, that the defendant was not notified of the acceptance of the guaranty, if, in point of law, he was entitled to this notice, or to notice of the advances made, a new trial cannot be granted.

The questions involved in the case are deeply interesting to the mercantile community ; and we have attentively considered them, as well in relation to the authorities, as to the principles on which they rest.

And in the first place, on principle, we think the defendant was entitled to the notice on which he insists ; and that the rule laid down, by the judge on the circuit, is founded in the highest justice and equity.

It is an elementary principle, that when the existence of a material fact, is more peculiarly within the knowledge of the plaintiff than of the defendant, notice of that fact must be averred and proved; and we can see no reason why the rule should not be applied to this case. On the contrary, we think that both the analogies of the law, and the principles of justice demand its application. There is an obvious and striking resemblance between this case, and that class of cases, where the rule in regard to notice is imperative.

We do not mean to say, that the party here is to be held to all that strictness which prevails, and is enforced, in the case of bills of exchange and promissory notes ; or that a person giving a letter of guaranty stands on the same ground as the indorser of a note or bill. But, as we have said, there is a resemblance between them. In both cases, the undertaking of the person sought to be charged, is collateral. In both, the facts, which go to create his liability, are known by the other party, but are not known to him. And we can see no reason, why strict notice should be required in the one case, and reasonable notice be dispensed with in the other. We think, in the language of Ch. J. Marshall, (Edmonstone v. Drake and Mitchell, 5 Pet. 624.) that “ it would be an extraordinary departure from that exactness and precision, which peculiarly distinguish mercantile transactions, which is an important principle in the law and usage of merchants, if a merchant [33]*33should act ou a letter of this character, and hSld the writer responsible without giving him notice that he pad acted on it.”

And not only is this notice essential to that exactness and precision, as well as to the good faith and confidence, which should characterize mercantile contracts ; but it is efjlially demanded by a regard to the rights and interests of the’defendant; and the most unjust results would follow were a Contrary doctrine to prevail. He ought to have the notice, to enable him to take such prudential measures as would guard hint against eventual loss ; to exercise a watchful supervision over the proceedings of him, for whom he became responsible; to piake payments, if necessar y, and to secure himself by suit. And this is still more important in the case of a continuing guaranty, like the present, in order that the party to be affected may either withdraw or modify the guaranty, as a regard to his own interests may dictate.

We cannot know before-hand whether his offer of guaranty will be accepted, and if accepted, to what extent, within certain limits, he is to be held ultimately liable. He ought, therefore, to have reasonable notice, in order to charge him. In the absence of all notice, he “ would have a right,” in the language of Spencer, J. (Beekman v. Hale, 17 Johns. Rep. 134.) ‘-‘to believe that his offer had not been accepted. He would be completely thrown off his guard ; and at a distant period, when an insolvency of the principal debtor had intervened, and all hopes of indemnity were gone, he would find himself unexpectedly called on to pay a debt, which he never knew that he was liable for. Good faith, atid the very nature afthe negotiation, alike require it of the party acting on and accepting a proffered guaranty, to apprise the other party of what is done, and what he is liable for.”

This principle, so reasonable in itself, so consonant to the claims of justice and equity, and imposing no hardship on the person accepting the guaranty, is, we think, fully sustained by the authorities.

It is, however, due to the counsel for the plaintifls, that we notice the cases relied upon by them, and which are supposed to conflict with the principle advanced in the charge. Several adjudications, both in England and in this state, have been urged upon us. And in regard to a portion of them, it need only be remarked, that they have no application to the ⅛-[34]*34fore the court. Thus, in the cases of Merle v. Wells, 2 Campb. 413., Mason v. Pritchard, 12 East, 227., and Hall v. Rand, 8 Conn. Rep. 576., the present question was neither discussed nor decided. Each of these cases turned, entirely, upon the character of the guaranty ; whether it were a continuing or a limited one.

So also the cases of Williams v. Granger, 4 Day, 444. and Breed v. Hillhouse, 7 Conn. Rep. 523., are clearly distinguishable from the present. In each of these, there was an express and unconditional guaranty of a note of hand. The sums for which these respective guarantors became responsible, were ascertained ; and equally within the knowledge of both parties. No future executory act remained to be done. In each, the undertaking of the defendant was absolute, that the note should be paid within the time limited ; and it was correctly held, that no notice was necessary.

But this is not the case of the. guaranty of a specific sum already agreed upon; not of a debt already created ; but of an undertaking to pay, not exceeding a given amount, and which was, of course, uncertain, and depending on some future and execu-tory act, in which the defendant had no participation.

It will, therefore, be readily perceived, that the principle, which governed those cases, has, here, no application. The only case, in our own court, which has a direst bearing upon the present, is that of Rapelye v. Bailey, 3 Conn. Rep. 438., and 5 Conn. Rep. 149.; and that case so far from affording any support to the claims of the plaintiffs, is, as will be shown in a subsequent part of the argument, entirely opposed to them. The same remark may be, here, made in regard to the decisions which have been had in the United States courts, and in the courts of the several states. We know of no one, and our researches have enabled us to find none, unless it be the case of Clark & al. v. Burdett, decided by the superior court of the city of New York, 2 Hall's S. C. Rep. 197., where notice, upon a state of facts like those now before us, has been held to he unnecessary. But the cases in which the opposite doctrine has been held, are numerous, and will hereafter be considered.

We are very well aware, that in the English cases upon this subject, some dicta

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Bluebook (online)
13 Conn. 28, Counsel Stack Legal Research, https://law.counselstack.com/opinion/craft-v-isham-conn-1838.