J. R. Watkins Medical Co. v. McCall

133 N.W. 966, 116 Minn. 389, 1911 Minn. LEXIS 1002
CourtSupreme Court of Minnesota
DecidedDecember 29, 1911
DocketNos. 17,437—(167)
StatusPublished
Cited by16 cases

This text of 133 N.W. 966 (J. R. Watkins Medical Co. v. McCall) is published on Counsel Stack Legal Research, covering Supreme Court of Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
J. R. Watkins Medical Co. v. McCall, 133 N.W. 966, 116 Minn. 389, 1911 Minn. LEXIS 1002 (Mich. 1911).

Opinion

Brown, J.

The facts in this case are substantially as follows: Plaintiff is a corporation engaged in the business of manufacturing and selling patent medicines and household remedies of various sorts. The sales of its products are made through representatives located in different parts of the state and elsewhere. In 1904 plaintiff entered into a contract with defendant McCall, in and by the terms of which plaintiff sold and agreed to deliver to McCall such of its products as he might from time to time order, to be by McCall sold from house to house within the territory mentioned in the contract. By the terms of the contract McCall was designated as the “traveling salesman” of plaintiff, but the products delivered to him became his property, and he was given the option of two methods of making payment therefor: (1) By remitting weekly as1 sales were made; or (2) by paying in cash within ten days from date of the bill of goods shipped, receiving in that case a discount of three-per cent. The contract extended for one year, and expired about January 1, 1905. Defendants Schweitzer, Schroeder, and Murphy guaranteed the faithful performance of the contract by McCall, and agreed to become responsible for the payment of any indebtedness incurred by him thereunder. This guaranty was in writing, attached to and made a part of the contract.

At the expiration of the contract a new one of the same import was entered into for the ensuing year; defendants Schweitzer, Schroeder, and Murphy being guarantors as before. That contract contained the provision: “At the expiration of this contract, the J. R. Watkins Medical Company hereby agrees to make a new contract with said traveling salesman, without requiring his account to be paid in full at the time, provided the amount of his business [392]*392and the conduct of the same has been satisfactory to said company.’’' Before the expiration of that contract, a third one was entered into,, in, the same form as the preceding contract, and defendants again became guarantors. The contract of guaranty was in the following-language: “Bor and in consideration of the appointment of the-above-mentioned traveling salesman, we hereby agree to be jointly and severally responsible to said The J. R. Watkins Medical Company for the faithful performance of this contract on the part of said traveling salesman, as, outlined on back of this agreement, and; for the payment of any balance that may be due said company by-him at date of acceptance of this contract.” At the time- this third1 contract was entered into, McCall was indebted to plaintiff for-goods received under prior contracts, then due and unpaid, in the sum of $8-48.37, which was reduced by payments during the life of the third contract to the sum of $813.79.

This action was brought to recover that amount, with interest, and the action is predicated, as to defendants Schweitzer-, Schroeder, and Murphy, upon their guaranty attached to and made a part of' the third contract. The guarantors, Schweitzer, Schroeder, and Murphy, alone answered, setting up several defenses, and the questions raised thereunder will be disposed of in their order. Plaintiff had a verdict, and defendants appealed from an order denying-their alternative motion for judgment or a new- trial.

1. It is contended that the court below erred i-n not dismissing-the action'at the close of the plaintiff’s case, and in refusing to direct a verdict for defendants, because the evidence failed to show an acceptance by plaintiff of defendants’ contract of guaranty. We do not sustain this contention.

Whether the formal acceptance of a contract of’ guaranty like that involved in the case at bar, as applied to sales of goods upon, credit in the future, is essential to the validity of the contract, is a. question upon which the courts are hopelessly in conflict. In a note to Wm. Deering & Co. v. Mortell (S. D.) 16 L.R.A.(N.S.) 352, numerous authorities are collected, showing the diversity of opinion upon the subject. The case of Winnebago Paper Mills v. Travis, 56 [393]*393Minn. 480, 58 N. W. 36, is in line with those courts which hold tc. the rule that acceptance and notice thereof by the guarantee is necessary. And while the rule requiring-notice of acceptance is applied’, in the abstract by probably a majority of the courts, the existence-of certain facts in respect to the contract is held to render the-, formal acceptance unnecessary — for illustration, the receipt of a-valuable consideration. And the courts also distinguish between-, the conditional and the absolute undertaking on the part of the-guarantor, applying the rule of acceptance only to the conditional! agreement; but contracts substantially in the language of that at bar have been treated by some courts as conditional and by others as; absolute engagements. But it is unnecessary to further- pursue the-subject. The question is not involved in the case no.w before us.

It may be conceded, under the authority of the Winnebago Mills, case, that as to future sales of goods -to McCall under the contract in question the guaranty of defendants was conditional, and notice of acceptance was necessary. But no claim is made for goods sold subsequent to the time the contract was entered into-. On the contrary, the action is founded upon that part of the contract by which-, defendants guaranteed the payment of any indebtedness due to plaintiff from McCall under the prior contracts. The contract of guaranty in this respect made defendants responsible for the payment of the existing indebtedness, and is clearly independent of that part of the guaranty having reference to future sales to be made to McCall. This distinction was made in the Winnebago Mills case; the-, court there holding that as to future sales an acceptance was necessary, but as to the existing indebtedness, which the guarantors there-agreed to pay, no recovery could be had, for the reason that by a proper application of payments subsequently made by the debtor-that indebtedness had been paid and discharged. There can bé no-serious question in this case but that defendants’ guaranty of payment of the existing indebtedness was an absolute and not a conditional undertaking, and as to that no notice of acceptance was necessary. Lehigh Coal & Iron Co. v. Scallen, 61 Minn. 63, 63 N. W. 245; 20 Cyc. 1408, and cases cited in note 64.

Nor is it material that the amount of the- existing indebtedness-» [394]*394was not made known to defendants at the time they signed the contract. The indebtedness referred to, and of which they guaranteed the payment, arose out of the prior contracts to which they were parties, and represented an unpaid balance due from McCall to plaintiff. Defendants could have readily ascertained the amount by inquiring of McCall, at whose instance they signed the guaranty, and it was a fact definitely known at the time, though not communicated to defendants. There was, therefore, no such uncertainty as to render the contract a nullity. The consideration for the promise was sufficient as a matter of law. As expressed in the writing it was, in substance, in consideration of the appointment of McCall as traveling salesman we guaranty payment of the existing debt. By the same instrument and on the faith of the guaranty McCall was appointed and continued thereafter as plaintiff’s traveling salesman.

It follows, therefore, since the guaranty was an absolute and unconditional promise to pay, was based upon a sufficient consideration, and was in all respects valid, that plaintiff may recover thereon, unless the further contentions of defendants be. resolved in their favor.

2.

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

Related

Southdale Center, Inc. v. Lewis
110 N.W.2d 857 (Supreme Court of Minnesota, 1961)
American Tobacco Co. v. Chalfen
108 N.W.2d 702 (Supreme Court of Minnesota, 1961)
Schmidt v. McKenzie
9 N.W.2d 1 (Supreme Court of Minnesota, 1943)
W. T. Rawleigh Co. v. Franken
273 N.W. 665 (Supreme Court of Minnesota, 1937)
Martin v. Fee
226 N.W. 203 (Supreme Court of Minnesota, 1929)
Furst & Thomas v. Moseley
277 S.W. 877 (Supreme Court of Arkansas, 1925)
Midland National Bank v. Security Elevator Co.
200 N.W. 851 (Supreme Court of Minnesota, 1924)
Wyman, Partridge & Co. v. Bible
184 N.W. 45 (Supreme Court of Minnesota, 1921)
Stone-Ordean-Wells Co. v. Helmer
171 N.W. 924 (Supreme Court of Minnesota, 1919)
J. R. Watkins Medical Co. v. Miller
168 N.W. 373 (South Dakota Supreme Court, 1918)
Northern National Bank v. Douglas
160 N.W. 193 (Supreme Court of Minnesota, 1916)
Standard Salt & Cement Co. v. National Surety Co.
158 N.W. 802 (Supreme Court of Minnesota, 1916)
Asmussen v. Post Printing & Publishing Co.
26 Colo. App. 416 (Colorado Court of Appeals, 1914)
J. R. Watkins Medical Co. v. Moss
141 N.W. 497 (Supreme Court of Iowa, 1913)
Turner v. Crumpton
141 N.W. 209 (North Dakota Supreme Court, 1913)

Cite This Page — Counsel Stack

Bluebook (online)
133 N.W. 966, 116 Minn. 389, 1911 Minn. LEXIS 1002, Counsel Stack Legal Research, https://law.counselstack.com/opinion/j-r-watkins-medical-co-v-mccall-minn-1911.