Am. Car Co v. Atlanta City St. Ry. Co

• Decision Date: 22 February 1897
• Citation: 28 S.E. 40,100 Ga. 264
• Parties: AMERICAN CAR CO. v. ATLANTA CITY ST. RY. CO. et al.
• Court: Georgia Supreme Court

28 S.E. 40

100 Ga. 264

AMERICAN CAR CO.

v.ATLANTA CITY ST. RY. CO. et al.

Supreme Court of Georgia.

Feb. 22, 1897.

Sale—Action for Price—Consideration— Waiver of Defects.

1. Where a promissory note, payable at a future day, signed by the purchaser of personal property as principal and by other persona as sureties, was given for a balance due upon the contract of purchase, and at or about the time of the maturity of such note the principal, with the same sureties and one other, renewed the original note, the principal then having full and complete knowledge of certain defects in the property, which knowledge had been acquired after ample opportunity for observing and ascertaining the character and condition of the property, neither such principal nor the sureties upon the second note could defeat a recovery in an action thereon by setting up the defense of "failure of consideration, " based upon the existence of such defects. Especially is this so when such principal, after the giving of the second note, repeatedly, in writing, acknowledged liability thereon, and promised to pay the same.

2. The question whether in such case any of the sureties who signed the first note, if they did so in ignorance of the defects in such property at the time of signing the second note, could for that reason avail themselves of any other defense, is not now for decision.

3. In view of the undisputed facts of this case, the principal defendant's knowledge at and before the time when the note sued on was executed of the defects in the property was fully established, and it was therefore error to submit to the jury for their determination the question whether or not such knowledge existed; and, under the evidence as a whole, the verdict was wrong.

(Syllabus by the Court.)

Error from city court of Atlanta; H. M. Reid, Judge.

Action by the American Car Company against the Atlanta City Street-Railway Company and others. Judgment for plaintiff for a portion of its demand, and it brings error. Reversed.

Fulton Colville, for plaintiff in error.

Anderson, Felder & Davis and Daley & Hall, for defendants in error.

COBB, J. The American Car Company brought suit against the Atlanta Street-Railway Company as principal, and Aaron Hass and others as sureties, on a promissory note dated August 7, 1893, for $2,025, besides interest. The defendants pleaded. "That the consideration of the note sued on was six car bodies purchased by the Atlanta City Street-Railway Company from the said

American Car Company for the sum of $——.

All of the said amount was paid except thesum of $2,025, which was represented by the note sued on. * * * That the consideration of the note sued on has partially failed—that is, to the extent of $2,025, —for the reason that said car bodies were not merchantable and reasonably suited to the uses intended, in that they were not properly...