Columbus Sewer Pipe Co. v. Ganser

• Decision Date: 04 November 1885
• Citation: 25 N.W. 377,58 Mich. 385
• Court: Michigan Supreme Court
• Parties: COLUMBUS SEWER-PIPE CO. v. GANSER and others.

25 N.W. 377

58 Mich. 385

COLUMBUS SEWER-PIPE CO. v. GANSER and others.

Supreme Court of Michigan

November 4, 1885

Hatch & Cooley, for plaintiffs.

A. McDonell, for appellant.

SHERWOOD, J.

This is an action of assumpsit brought by plaintiff to recover an amount claimed to be due to the company upon a certain bond executed by defendants to the plaintiff, on the twenty-fourth day of May, 1882, in which defendants Brunner and Cusson were sureties; the bond being a mercantile guaranty to secure to the plaintiff the purchase price of sewer-pipe purchased by defendant Ganser, and which reads as follows:

"Know all men by these presents, that we, August Ganser, Joseph Cusson, and Charles Brunner, of Bay City, and Bay county Michigan, are held and firmly bound unto the Columbus Sewer-pipe Company, a corporation duly organized under the laws of Ohio, of Columbus, Franklin county, Ohio, in the sum of three thousand ($3,000) dollars, for the payment of which well and truly to be made we hereby jointly and severally bind ourselves. Signed, sealed, and dated this twenty-fourth day of May, A.D.1882.

"The condition of this obligation is such that, whereas the said August Ganser has arranged and is about to purchase on credit sewer-pipe of said Columbus Sewer-pipe Company: now if the said August Ganser shall well and truly pay said Columbus Sewer-pipe Company for all goods purchased, or that he may hereafter purchase, of them according to the terms of purchase, then this obligation to be void, otherwise in full force and effect for the amount of his said indebtedness not exceeding three thousand dollars."

The declaration contains a special count upon the bond, also the common counts. The defendant, one of the sureties, appeared and pleaded the general issue. The record shows a trial by jury was had in the Bay circuit, and a judgment was rendered in favor of the plaintiff for $1,773.52 damages. Defendant brings error.

The plaintiff claims the bond sued upon contains a continuing guaranty, subject to termination by notice from sureties. Counsel for defendant, on the other hand, insist that the same was limited to the purchases then made, or soon thereafter to be made, for the purposes of the work then about to be undertaken by Ganser, which was the purchase price for a sufficient amount of pipe necessary to the completion of a sewer in First street, in Bay City, and that the obligation of the sureties was therefore not a continuing one. The bond not being specific as to the length of time the liability of the sureties should continue, or as to the amount of material they intended to give their obligation for, the defendant, for the purpose of aiding the court in giving the proper construction to their contract in these particulars, proposed to show by Mr. Brunner when he was upon the stand as a witness the circumstances under which the sureties signed the bond, and, for that purpose, asked the witness the following question. "When you signed that bond what, if anything, was said as to the time that the bond was to run?" This was objected to by plaintiff's counsel as incompetent and immaterial. Counsel for defendant then stated to the court: "I offer to show that at the time the bond was executed it was done with the express understanding between the parties that it was to be good for the sewer-pipe which was to be furnished for the First-street sewer only. I propose to show that that was the condition upon which the bond was executed and delivered. I want to show the time for which it was to run." The court ruled, "That must be determined from the bond itself and the subsequent circumstances," and sustained the objection.

We think the court erred in this ruling. The testimony was competent for the purpose offered. Their responsibility was given to the plaintiff to secure it in a limited amount to aid Ganser in the purchase of materials necessary to the completion of a certain work, and if this were true it certainly would have aided the court and jury, not only in ascertaining the time the bond would run, but also the extent of the sureties' liability thereon, without in any manner changing or modifying the terms or condition of the bond. All contracts are to be construed in the light of the circumstances under which they are made, and this is no infringement of the rule that parol contemporaneous evidence is inadmissible to contradict or vary the terms of a written instrument. Showing the circumstances under which the contract is made, and the subject-matter to which it relates does no more than aid the court and jury to better understand the true sense in which the words are used and understood by the parties. If this were not permissible, great injustice would frequently be done after the most diligent effort and best consideration that possibly could be given to the subject. There was no error in allowing the witness Sturgeon to be sworn and examined after his deposition had been read by consent of defendants' counsel If the deposition, under the circumstances, had been objected to at the proper time the objection would have been good. The waiver of that right furnished, however, no ground for excluding the witness if present when his testimony was needed. Ganser settled up with Sturgeon for all his indebtedness to the company to May 20, 1883, and paid the company in full; and it was conceded at the circuit that at the time of the settlement no liability of the defendant Brunner existed upon the bond for anything that had been purchased up to that date, and it further appears that the liability claimed arose after that date, and not for anything purchased for First-street sewer It is unnecessary to discuss the exception taken to the charge of the court relating to the implied notice given to Sturgeon of Brunner's non-liability for further purchases made of the plaintiff by Ganser, although we think the treatment of that subject as presented in the charges was not without damaging effect to the interest of defendants before the jury. It contained and submitted facts to be passed upon not contained in the evidence, and required them to find too much to constitute notice that Brunner terminated his liability upon the bond. The...