Koch v. Melhorn

25 Pa. 89

• Court: Supreme Court of Pennsylvania
• Decided: July 1, 1855
• Status: Published

Opinion

The opinion of the Court was delivered by

Woodward, J.

This was an action upon a parol guarantee of a sealed note which Koch held against the borough of Erie, and which he transferred to Melhorn on account of stone delivered in 1846. There was an apparent discrepancy between the testimony of Samuel Melhorn and Myron Sanford, as to the time when the plaintiff below got the note, and out of this there grew up at the trial an embarrassing question as to the consideration of the alleged guarantee; but the jury settled the difficulty by finding, as the testimony of the Melhorns abundantly authorized, that the contract of guarantee was made at the time of the transfer of the note, and upon the same consideration. The assignment written by Spencer must have been subsequently made, and there was nothing in its terms to exclude the parol evidence of the guarantee.

Granting the guarantee to have been duly proved, it is insisted that the plaintiff was not entitled to recover without showing that recourse had been had to the makers of the note, and due diligence used to enforce payment from them.

The guarantee of Koch, as proved by Samuel Melhorn, was, that the note was “ just as good as if he would give him (the plaintiff) the money — that he would insure it as good as gold and silver.” There was no condition expressed that Melhorn should sue the makers; and, under the circumstances of the case, none can be implied. This note and another were made by the borough of Erie to one Dewey, for a town clock, with a condition expressed that the said clock should perform to the satisfaction of the borough officers. Koch held both notes; and, having transferred one to Melhorn, brought suit on the other against the borough, when it was proved that the clock was worthless, and Koch was defeated. Now this evidence tended to show that the note transferred to Melhorn was also worthless, and incapable of being recovered; and, if the jury so believed, the contract of guarantee was broken as soon as made, and Melhorn was under no obligation to pursue the borough. To warrant that a debt is as good as gold and silver is to warrant that it is founded on a legal consideration — that the debtor is of competent ability,; and that the debt will be paid on demand. If the debtor be' insolvent (3 Harris 293), or, for any other reason, the debt cannot be recovered, an action against him is not necessary to fasten the guarantor. But there were other circumstances in proof, in this case, which, if believed by the jury, relieved Mel-horn from all necessity to sue the borough. After he had demanded payment of the note, and learned that the consideration had failed, he offered to return it to Koch, who begged him to wait till his suit against the borough on the other note was decided, when he (Melhorn) would be sure to get his money — assuring him that that suit would collect both notes, and added that he would “ gain the suit as sure as the sun shines.” Like many other over confident litigants, Koch was disappointed by the event of his suit. His note proved to be worthless, and that, the test of his own proposing, established the worthlessness of the note he had guarantied to Melhorn. Under such circumstances, the Court were very clearly right in holding that Melhorn might recover in this action, without proving a resort to legal remedies against the borough.

These observations dispose of all the errors assigned upon the charge of the Court, that wore pressed in the argument, or are worthy of notice.

The bills of exception to evidence are groundless. Eull proof of the loss of the note having been made by Mr. Babbitt, into whose hands it was traced, the secondary evidence was properly admitted. ’

The record of the unsuccessful suit, on the note retained by Koch, was most pertinent evidence as establishing, in connexion with the parol evidence, the failure of consideration of both notes.

The judgment is affirmed.