Nashville Electric Supply Co. v. Kay Industries, Inc.

533 S.W.2d 306, 1975 Tenn. App. LEXIS 162
CourtCourt of Appeals of Tennessee
DecidedJuly 25, 1975
StatusPublished
Cited by9 cases

This text of 533 S.W.2d 306 (Nashville Electric Supply Co. v. Kay Industries, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals of Tennessee primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Nashville Electric Supply Co. v. Kay Industries, Inc., 533 S.W.2d 306, 1975 Tenn. App. LEXIS 162 (Tenn. Ct. App. 1975).

Opinion

OPINION

TODD, Judge.

The plaintiff, Nashville Electric Supply Company, Inc., sued Kay Industries, Inc., as principal obligor, and Donald R. O’Guin, as guarantor, for merchandise sold to said Kay Industries, Inc., in the amount of $10,775.26. The Chancellor rendered judgment against both defendants for $10,775.26. Kay Industries, Inc., did not appeal. Donald R. O’Guin has appealed and assigned the following errors: .

I.
“The Court erred in not holding that the required signature of either the Defendant Donald R. O’Guin or that of Jim O’Guin in the letter of April 5, 1973 as [308]*308being an absolute condition precedent to a personal guarantee of payment on the part of Donald R. O’Guin.
II.
“The Court erred in construing the letter of May 23, 1973 as being a guarantee by default of the indebtedness owed by Kay Industries to Nashville Electric Supply, and further by not adopting the plain and unambiguous words in said letter.”

On or about March 29, 1973, plaintiff received an order from Kay Industries, Inc., which corporation had no established line of credit with plaintiff. On said date, plaintiff’s credit manager telephoned the appellant, O’Guin, and offered to fill the order if he, O’Guin, would guarantee payment. Mr. O’Guin replied that he would guarantee “the account” and that he would confirm by letter. Thereupon, the order was filled and shipped to Kay Industries, Inc.

Thereafter plaintiff received from appellant a letter dated April 5,1973, and stating the following:

“This letter is to confirm that I agree to be personally liable for all credit extended to Kay Industries at Centerville, Tennessee. I request that no shipment be made without purchasing order bearing my signature or Jim O’Guin.”

Subsequently, other orders were received and shipped to Kay Industries. Copy of each invoice was mailed to appellant, but he denies receiving them. None of said orders was supported by a purchase order as requested in the letter quoted supra.

On May 23,1973, appellant wrote a letter to certain individuals connected with Kay Industries, Inc., in which he stated:

“This letter is to further clarify your agreement on the payment of all outstanding bills owed by Kay Industries that I have personally guaranteed. Our agreement is you will deliver to American Auto, Camper and Mobil Home, Incorporated, at dealer’s cost, enough mobil homes to equal the dollar value of the outstanding accounts. The creditor and the amount owed is as follows:”

The list following the above quotation includes the name of plaintiff and the amount, $14,222.97. Subsequently a $4,097.18 payment was made by check signed “Kay Industries, Inc., Donald O’Guin, Sr.” This would have reduced the debt from $14,222.97 to $10,125.97. The difference between this latter amount and $10,775.26, the amount sued for, and the amount of the judgment is not explained in the record, however, it appears that no issue was made as to the amount due.

Appellant’s defense and appeal are based upon the proposition that the true meaning and legal effect of the sentence, “I request that no shipment be made without purchasing order . . .” was and is to fix a condition which limited defendant’s guaranty agreement; and, therefore, the failure of plaintiff to secure purchase orders for any of its shipments prevents the guaranty agreement from taking effect.

In support of this proposition, appellant points out that the guaranty letter was written without the benefit of skilled legal counsel. Appellant cites Garner v. Becton, 187 Tenn. 34, 212 S.W.2d 890 (1948) and Trimble v. Holley, 49 Tenn.App. 638, 358 S.W.2d 343 (1962); however, those cases involved the drafting of wills which are unilateral instruments. The present case involves a bilateral instrument in that it was prepared by one party and relied upon by the other party in a substantial business transaction. In the construction of a will, the sole objective is to ascertain the intent of the testator. In the construction of a bilateral contractual instrument, the objective must be the ascertainment of the mutual intent of the parties or, if the parties did not have the same understanding of the words used, to determine the more reasonable meaning which should have been intended by the parties.

Appellant cites McClure v. Keeling, 163 Tenn. 251, 43 S.W.2d 383 (1931), (a will case) for the proposition that “it is intended that every word have some meaning.” In [309]*309the present case, the words, “I request” do indeed have a meaning, but not that which appellant now insists. The word, “request” does not ordinarily imply any form of compulsion.

“Request, v. To ask for something or for permission or authority to do, see, hear, etc., something; to solicit; and is synonymous with beg, entreat, and beseech. Artificial Ice & Cold Storage Co. v. Martin, 102 Ind.App. 74, 198 N.E. 446, 449. (In) its ordinary or natural meaning when used in a will, is precatory and not mandatory. Byars v. Byars, 143 Tex. 10, 182 S.W.2d 363, 364, 366.”—Black’s Law Dictionary, Fourth Edition, p. 1468.
“Request v. . express a wish or desire ... to ask for . . .” Webster’s Third New International Dictionary.

In Comford v. Cantrell, 177 Tenn. 553, 151 S.W.2d 1076 (1941), a will case, the Supreme Court reviewed a number of authorities and concluded that,

“The words ‘request,’ ‘desire,’ and the like, do not naturally import a legal obligation.”

If such is the rule in respect to wills, then it is applicable even more strongly to bilateral instruments where another party acts upon the commonly accepted meaning of the words.

Appellant cites Bright v. McKnight, 33 Tenn. (1 Sneed) 158 (1853), where no condition was attached to a guaranty, and the Court enforced the same. The Court said:

“In pursuance of this view, it was decided by the Supreme Court of the United States, in Drummond v. Prutman [Prestman], 12 Wheat. [25 U.S.] 515 [6 L.Ed. 712], that a guarantor shall be held bound to the full extent of what appears to be his engagements, and the rule in expounding these undertakings is that the words of the guaranty are to be taken as strongly against the guarantor as the sense will admit. Fell on Guar., ch. 5, p. 127; 12 East, 227.
“No injury can result from this doctrine, as it is in the power of guarantors to make their obligation dependent upon notice, demand, or any other condition they see proper, for their own protection and safety.
“It would be difficult to select words more direct, positive, and unconditional than those used in the present ease. The contract of Moore was before them, set out in all its terms, and their undertaking written upon it with express reference to its contents.

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Bluebook (online)
533 S.W.2d 306, 1975 Tenn. App. LEXIS 162, Counsel Stack Legal Research, https://law.counselstack.com/opinion/nashville-electric-supply-co-v-kay-industries-inc-tennctapp-1975.