Bishop Press Company v. Lowe

• Decision Date: 14 March 1919
• Citation: 209 S.W. 962,201 Mo.App. 68
• Parties: BISHOP PRESS COMPANY, Respondent, v. FRANK LOWE, Appellant
• Court: Kansas Court of Appeals

209 S.W. 962

201 Mo.App. 68

BISHOP PRESS COMPANY, Respondent, v. FRANK LOWE, Appellant

Court of Appeals of Missouri, Kansas City

March 14, 1919

Appeal from Jackson Circuit Court.--Hon. Clarence A. Burney, Judge.

REVERSED AND REMANDED.

Judgment reversed and cause remanded.

Henry L. Jost for appellant.

Sebree Conrad & Sebree for respondent.

OPINION

ELLISON, P. J.--

Plaintiff's action is based on a contract of guaranty and it obtained judgment against the defendant guarantor in the trial court.

It appears that plaintiff contracted with the "New Empress Advertising Company" that it should furnish paper and material for 250,000 "program covers" and print them in a workmanlike manner for the New Empress Advertising Company which company was to pay plaintiff $ 1000, therefor. It further appears that defendant entered into the following contract of guaranty with plaintiff, viz, "I hereby guarantee the fulfillment of this contract by the New Empress Advertising Company and the payment of all money due the Bishop Press from them under this contract." There was evidence tending to prove that plaintiff furnished the paper (at least in great part) and printed the covers and delivered them to the "New Empress Company," and that it has not been paid the price it was to receive from the "New Empress Advertising Company." This action, as above stated, was thereupon instituted against defendant as guarantor.

The case presents the anomaly of the plaintiff making the contract (the payment of which defendant guaranteed) with a fictitious party. That is, it appears that the contract guaranteed was made between plaintiff and the "New Empress Advertising Company," whereas there is no such company, the real party being the corporation "New Empress Company." But plaintiff insists that the latter real company had a right to contract with plaintiff in the fictitious name, citing in support of the proposition Sparks v. The Dispatch Trans. Co., 104 Mo. 531, 548; Radley v. Meeks, 178 Mo.App. 238 and Bartlett v. Tucker, 104 Mass. 336, 339. Those cases bear out plaintiff's position. But where it is sought to establish the contract against the real party, the pleading should show the ground for so doing by proper averment. It was so shown by the petition in each of the cases cited; while in this case there is nothing in the pleading to indicate that the "New Empress Advertising Company" was not the real party contracting with plaintiff. That left the case stand as stated in the petition and when it came to the proof a different state of facts appeared, thus constituting a variance. But we are of the opinion that this ought not to cause a reversal of the judgment outright, since plaintiff may amend by setting up the facts.

In this way an important question arises. Is a guarantor liable to the creditor when the party named as the principal debtor is a fictitious person--a real person having used a fictitious name? Stated differently, A and B, enter into a contract the latter using a fictitious name, and C, guarantees that the fictitious party will perform the contract, is C liable to A on the guaranty? Leaving out of view the question whether C knew that B, was the real party, using a fictitious name, we think he would not. For as stated by defendant, a guaranty is a collateral undertaking and it is essential to its existence that here should be some one liable as principal and if there is no valid claim against a principal there is no existing contract of guaranty. [Saving Bank v. Strother, 22 S.C. 552, 556.]

In Barns v. Barrow, 61 N.Y. 39, the guaranty was to a particular person and a firm, of which such person was a member, undertook to recover on the guaranty and it was held there was no liability. The court said: "It is a case of pure guaranty; a contract which is said to be strictissimi juris; and one in which the guarantor is entitled to a full disclosure of every point which would be likely to bear upon his disposition to enter into it. The consideration of the contract does not enure to him, but to another. He assumes the burden of a contract without sharing in its benefits. He has a right to prescribe the exact terms upon which he will enter into the obligation, and to insist on his discharge in case those terms are not observed. It is not a question whether he is harmed by a deviation to which he has not assented. He may plant himself upon the technical objection, this is not my contract, non in haec foedera veni. Accordingly, in the present case, he may say: I contracted with John W. Barns, and will not be liable for supplies furnished by a firm, though he may be a member of it.'" Further on the court said that the sole question is: "To what did he (the guarantor) agree? And if he contracted with one person, as he had reason to suppose, no other person can be substituted in the place of the apparent contractee. On like grounds no person can be added to or subtracted from the apparent number. The words of the written instrument point out the person with whom he contracted and measure his liability." Again the court said: "It is not possible, on any principal of construction established by the commentators and the cases cited, to add to the name of John W. Barns those of William and Charles Barns, his copartners."

In Lamm & Co. v. Colcord, 22 Okla. 493, a guarantor guaranteed against the default of O. C. Scoresby and credit was extended to the Scoresby Tailoring Company and there being no proof that Scoresby solely comprised the Tailoring Company it was held that the guarantor was not liable for the default of such Company. At page 500 of the report the court said that 'the guarantor agreed to answer for the default of O. C. Scoresby. The record shows that upon this instrument of guaranty the goods were furnished the Scoresby Taloring Company. There is no presumption that they were one and the same. A guarantor has the right to prescribe the exact terms upon which he will enter into the obligation, and to insist upon a discharge in case those terms are not observed."

In Grant v. Naylor, 4 Cranch 224, it was ruled, in an opinion by Chief Justice MARSHALL, that a guarantor's letter of guaranty addressed by mistake to John and Joseph Naylor but, intended for, and delivered to, John and Jeremiah Naylor, who furnished merchandise to the principal debtor, would not support an action by John and Jeremiah against the guarantor.

In Allison v. Rutledge, 5 Yer. 193, the guaranty was addressed to John Allison and acted upon by John and Joseph Allison, it was decided that the guarantor could not be held.

In McGovney v. State of Ohio, 20 Ohio 93, it was held that a bond describing a testator as James L. Findley could not be made applicable to Joseph L. Findley.

In Lyon & Co. v. Plum, 75 N.J.L. 883, it was held that a guaranty to a named partnership, could not apply when a new member was added or an old one taken away.

In Jordan Marsh & Co. v. Beals, 201 Mass. 163, the decision was that a guaranty to a partnership for the purchases of the principal debtor, could not be enforced by a corporation of the same name which took over its assets and liabilities composed of the same persons who made up...