Cont'l Oil Co. v. Horsey, No. 61.

• Court: Court of Appeals of Maryland
• Writing for the Court: BOND, Chief Judge
• Citation: 9 A.2d 607
• Parties: CONTINENTAL OIL CO. v. HORSEY et al.
• Docket Number: No. 61.
• Decision Date: 29 November 1939

9 A.2d 607

CONTINENTAL OIL CO.
v.
HORSEY et al.

No. 61.

Court of Appeals of Maryland.

Nov. 29, 1939.

Appeal from Circuit Court, Queen Anne's County; Wm. Mason Shehan, Judge.

Action by the Continental Oil Company against T. Clayton Horsey and another on a guaranty of payment of any shortage due to fault of one contracting to sell plaintiff's wares at a filling station. From a judgment on a directed verdict for defendants, plaintiff appeals.

Reversed, and new trial awarded.

Argued before BOND, C. J., and OFFUTT, PARKE, SLOAN, MITCHELL, JOHNSON, and DELAPLAINE, JJ.

Edward T. Miller and Harry E. Clark, Jr., both of Easton, and John Palmer Smith, of Centerville, for appellant.

J. DeWeese Carter, of Denton (Thomas J. Keating, Jr., of Centerville, on the brief), for appellees.

BOND, Chief Judge.

The parties to this appeal present the single question whether the giving of a note payable on demand after date for a pre-existing debt discharged guarantors of that debt. In a suit by a creditor against the guarantors, a verdict for the defendants was directed at the close of testimony on the plaintiff's behalf, and from the judgment entered accordingly the plaintiff appeals.

The plaintiff is a dealer in gasoline, oils and other merchandise, and in consideration of making a contract with William E. Cohee to sell its wares at a filling station, received from the defendants on March 15, 1934, a written agreement guaranteeing payment to the plaintiff of "any sum of money which may become due on account of stock shortage, cash shortage, or any form of shortage that might occur due to the fault of William E. Cohee". The money limit of the liability was to be $1,000. There was evidence of a shortage of $665.42 in the early part of the year 1937. The record contains a written statement by William E. Cohee admitting the shortage, and a note for the amount was given by him the same day, March 26, 1937. The note is in a common form, reading that, "On Demand after date," the maker promises to pay the amount; and it provides for confession of a judgment.

The contention of the defendants and appellees is that by the taking of the note in this form there was a suspension of enforcement of the obligation for one day, until "after date" and that this was a material alteration of the debt guaranteed which must release the guarantors. But that form, usually, and perhaps always, the result of writing the note on a printed

9 A.2d 608

blank, has been dealt with in a large number of cases in recent years, and there has been an almost unanimous opinion that the words "after date" do not give an extension of credit until the next day, and that a demand is not required to mature the note; in other words, that it is not to be distinguished at all from a note reading payable on demand simply. Hitchings v. Edmands, 132 Mass. 338; Fenno v. Gay, 146 Mass. 118, 15 N.E. 87; City Nat. Bank v. Adams, ...