Hickory Novelty Co. v. Andrews

188 N.C. 59
CourtSupreme Court of North Carolina
DecidedJune 21, 1924
StatusPublished
Cited by4 cases

This text of 188 N.C. 59 (Hickory Novelty Co. v. Andrews) is published on Counsel Stack Legal Research, covering Supreme Court of North Carolina primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hickory Novelty Co. v. Andrews, 188 N.C. 59 (N.C. 1924).

Opinion

Clarkson, J.,

after stating tbe facts: Tbe only question presented on tbe entire record is: Did tbe defendant guarantee to plaintiff tbe account sued on, $3,174.12 and interest? We are of tbe opinion that be did.

C. S., 987, is as follows: “No action shall be brought whereby to charge an executor, administrator or collector upon a special promise to answer damages out of bis own estate, or to charge any defendant upon a special promise to answer tbe debt, default or miscarriage of another person, unless tbe agreement upon wbicb such action shall be brought, or some memorandum or note thereof, shall be in writing and signed by tbe party charged therewith, or some other person thereunto by him lawfully authorized.”

Tbe statute applies to contracts of guaranty. Gilmer v. Improvement Co., 170 N. C., 452; Partin v. Prince, 159 N. C., 555.

A written promise by one to pay tbe debt of others, that “just as soon as tbe dry kiln gets in operation, I will see that your bill is paid,” is not a continuing guaranty, but, by fair implication, refers to an account already made and stated. Supply Co. v. Finch, 147 N. C., 106.

In Green v. Thornton, 49 N. C., 232, Battle, J., said: “It is not and cannot be denied that a guaranty in writing, made at tbe time of a contract between two or more persons, is binding upon tbe guarantor, because it is founded upon tbe consideration wbicb exists between tbe principal parties. But if it be made afterwards, without any new consideration, then it is not obligatory, and putting it in writing, if not under seal, will not help it. Rann v. Hughes, 7 Term Rep., 350, note a. Tbe statute of frauds does not require tbe consideration to be in writing, and it may therefore be proved by parol. Miller v. Irvine, 1 Dev. and Bat. Rep., 103.” Partin v. Prince, supra.

[65]*65The statute does not apply to a promise to pay the debt of another out of the debtor’s property in the promissor’s hands. Mercantile Co. v. Bryant, 186 N. C., 553.

The statute does not apply where it is in the nature of an original obligation of the promissor. Marrow v. White, 151 N. C., 96; Partin v. Prince, supra.

In 12 R. C. L., 1053, it is said: “A guaranty has been defined by statute to be ‘a promise to answer for the debt, default, or miscarriage of another person.’ This definition substantially conforms to the judicial conception of a guaranty, which may fairly be summed up as a promise to answer for the payment of some debt or the performance of some obligation, on default of such payment or performance, by a third person who is liable or expected to become liable therefor in the first instance.” Grocery Co. v. Early, 181 N. C., 460; Enc. Dig. of N. C., Vol. 14, “Guaranty,” p. 275 et seq.

“If the object of the guaranty is to enable the principal to have credit over an extended time, and to cover successive transactions, it is a continuing one; hut if the intention of the guarantor, as indicated by the language used, is that hut one transaction is to be covered by the guaranty, it is a limited one.” Childs on Suretyship and Guaranty, sec. 23, p. 20. See 12 R. C. L., 1061.

In 12 R. C. L., 1062, part of section 11, it is said: “There seems to he no general rule for determining whether a guaranty is continuing; each must be construed according to its terms and the surrounding circumstances, to show which parol evidence is admissible. If the parties treat an instrument as a continuing guaranty, and its terms are not inconsistent with such construction, the courts will adopt that view.”

In Scovill Mfg. Co. v. Cassidy, A. & E. Anno. Cases (1898 E.), 611 (275 Ill., 462), under “Continuing Guaranties,” it is said: “Where by the terms of the guaranty it is evident that the object is to give a standing credit to the principal to he used from time to time, either indefinitely or for a certain period, it is generally deemed a continuing guaranty. ... It was said in Chester County Nat. Bank v. Thomas, 220 Pa. St., 360; 60 Atl., 813, 'Whether a contract of guaranty is a continuing undertaking is a question of intention which must be gathered from the instrument itself, or from the course of dealings between the parties or from both.’ If it appears that a future course of dealing for an indefinite time, or a succession of credits to be given, was contemplated by the parties, the contract will be construed to be a continuing guaranty,” citing a wealth of authorities.

In First Nat. Bank v. Waddell (74 Ark., 241), 4 A. & E. Anno. Cases, 822, under “Continuing Guaranties,” it is said: “In like manner, a guaranty will he held to be continuing if it is made in lan[66]*66guage which shows that the parties intended that it should cover not only present transactions, but also future transactions for an indefinite length of time,” citing many authorities.

We think the case of Newcomb v. Kloeblen, 77 N. J. L., 291, in point. The head-notes to that case are as follows:

"The plaintiffs were commission merchants; they refused to make any further sale to the defendant’s son unless his account was guaranteed by defendant. Defendant wrote to the plaintiffs, T will be responsible for any bill that my son James will make’: Held, that use of the word 'any’ did not limit the guarantee to the one bill of goods delivered when the guarantee was given," but that it was a continuing guarantee.
“In an action on a guarantee, where the issue is whether the guarantee is a continuing one, conversations between the guarantor and his son at the time of executing the guarantee are inadmissible for the purpose of showing the meaning of the guarantee.
“In construing a contract of guarantee, whatever may be the limitations as to time or amount, the rule of construction is to take the words of the contract together with the surrounding facts as the exponent of the meaning of the parties.”

The Court, in that case, said: “The fact of the previous dealing between James Kloeblen and the plaintiffs there appeared, and the absolute necessity on his part for a general credit for the future, as the plaintiff refused to make him further sales unless his father, the defendant, would guarantee his account with them. Under these circumstances the defendant guaranteed to be responsible for 'any bill that my son James will make,’ and this leads inevitably to the conclusion that the guarantee was to remain continuing until revoked.”

Similar cases are as follows: “Thus, a guaranty, without limitation as to time or amount, of the payment 'of all bills of goods sold or that may be sold,’ is a continuing one.” Conduitt v. Ryan, 3 Ind. App., 1. See, also, Doyle v. Nichols, 15 Colo. App., 458; Boehne v. Murphy, 46 Mo., 57. “A letter of credit stating that 'I will guarantee their engagements, should you think it necessary, for any transaction they may have with your house,’ is a continuing guaranty.” Grant v. Ridsdale, 2 Har. & J. (Md.), 186.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Hudson v. Game World, Inc.
484 S.E.2d 435 (Court of Appeals of North Carolina, 1997)
Amoco Oil Co. v. Griffin
338 S.E.2d 601 (Court of Appeals of North Carolina, 1986)
Cities Serv. Oil Co. v. HOWELL OIL CO., INC.
237 S.E.2d 921 (Court of Appeals of North Carolina, 1977)
ARCADY FARMS MILLING COMPANY v. Wallace
89 S.E.2d 413 (Supreme Court of North Carolina, 1955)

Cite This Page — Counsel Stack

Bluebook (online)
188 N.C. 59, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hickory-novelty-co-v-andrews-nc-1924.