Fidelity & Cas. Co. of New York v. Raborn

Citation234 Ala. 31,173 So. 402
Decision Date25 March 1937
Docket Number1 Div. 958
PartiesFIDELITY & CASUALTY CO. OF NEW YORK v. RABORN.
CourtSupreme Court of Alabama

Certiorari to Court of Appeals.

Petition of William Raborn for certiorari to the Court of Appeals to review and revise the judgment and decision of that Court in the case of Fidelity & Casualty Company of New York v William Raborn, 173 So. 399.

Writ denied.

In action on bond indemnifying surety on warehousemen's bond, plea alleging that there was no "valid consideration" for the agreement held demurrable.

The complaint claims damages for the breach of the condition of a bond or contract of indemnity made by defendant on November 28, 1932, payable to plaintiff in a sum not exceeding $2,500 with the condition that plaintiff became surety for J.C Campbell and W.J. McCowan, doing business as the Consolidated Warehouse, of Mobile, Ala., and wherein the defendant agreed "To indemnify the plaintiff against any and all claims, demands, losses, damages, costs, charges, counsel fees, expenses, suits, orders, judgments, and adjudications, whatsoever, that the Company shall or may for any cause at any time sustain or incur by reason of or in consequence of the said bond or any renewal thereof or any new bond issued in continuation thereof or as a substitute therefor; and the Indemnitor further covenants and agrees to place the Company in possession of funds whenever necessary for the Company's protection against such claims, demands, losses, damages, costs, charges, counsel fees, expenses, suits, orders, judgments and adjudications whatsoever; and to pay the Company, before the Company shall be compelled to pay the same, all damages, losses, costs, charges, counsel fees, and expenses for which the Company shall become liable by reason of, or in consequence of, the said bond or renewal thereof or any new bond issued in continuation thereof or as a substitute therefor."

It is alleged that the condition of the said bond or contract of indemnity has been broken by the defendant in this: "That the defendant has failed or refused to pay to plaintiff those certain sums of money the plaintiff was forced to pay Wm. Henderson Company in its suit against the plaintiff as surety on the bond of J.C. Campbell and W.J. McCowan, doing business as the Consolidated Warehouse as well as the costs of court in the litigation thereof, and attorney's fee incurred in the defense of said suit by the plaintiff, as well as the additional counsel fee it has incurred in this cause, in the total amount of $900, all of which the defendant was in duty bound to pay under the terms and conditions of the aforesaid bond or contract of indemnity and which, as alleged he has failed or refused to do."

Objections raised by the demurrer were, in effect, that the complaint does not set out sufficient parts of the agreement from which the court can determine what the condition is; that the condition as quoted in the complaint is that defendant agreed to indemnify plaintiff against losses that plaintiff might sustain or incur by reason of "or in consequence of said bond or any renewal thereof or any new bond issued in continuation thereof or as a substitute therefor," and there is nothing in the complaint showing what kind of bond is referred to or what its provisions were; that the complaint neither set out the bond referred to nor alleged the substance of its provisions.

Defendant's pleas set up as a defense to the suit that defendant notified plaintiff through its agent at Mobile that said Campbell and Cowan, doing business as Consolidated Warehouse, had been guilty of acts of dishonesty, that defendant was no longer willing to indemnify plaintiff against loss on account of said bond, and notified plaintiff to withdraw and cancel said bond, and that plaintiff failed, as it could have done, to cancel bond and avoid the losses, which occurred subsequent to such notice given by defendant.

Smith & Johnston, of Mobile, for petitioner.

Gordon, Edington & Leigh, of Mobile, opposed.

THOMAS Justice.

The questions presented are by way of certiorari to the Court of Appeals.

The petition contains, among other ground now to be decided, the following:

"1. The Court of Appeals erred in holding that parol evidence is admissible to show that the bond introduced in evidence in this case is the one covered by the agreement of indemnity, although there is a substantial inconsistency between the bond introduced in evidence and the bond described in the agreement of indemnity."
"4. The Court of Appeals erred in failing to hold that the defendant, William Raborn, was entitled to the affirmative charge.
"5. The Court of Appeals erred in holding that the demurrers to the complaint were properly overruled.
"6. The Court of Appeals erred in holding that the demurrers to all the pleas were properly sustained."

The opinion of the Court of Appeals recites the following facts: "*** the plaintiff introduced in evidence its bond to the State of Alabama, as authorized by the Agricultural Code of the State, Acts 1927, guaranteeing the good faith of the Consolidated Warehouse as principal in said bond, dated the 28th day of November, 1932. This bond was properly approved by the Commissioner of Agriculture and recorded as required by law. The plaintiff then introduced, over the objection and exception of the defendant, a contract of indemnity executed the 28th day of November, 1932, by and between William Raborn, this defendant, and the Fidelity & Casualty Company of New York, this plaintiff. In said contract of indemnity there is no sufficient description of the bond of the Consolidated Warehouse secured by the plaintiff, but, as a part of said contract of indemnity, there appears this clause: 'Whereas at the special instance and request of the Indemnitor and on the security of this agreement, the Company is or is to become surety for J.C. Campbell & W.G. McCowan D/B The Consolidated Warehouse of Mobile, Ala., on a certain bond running in favor of Commissioner of Agriculture & Industries--State of Alabama, a copy of which is attached hereto and made a part hereof.' But no copy of any bond was physically attached to the contract of indemnity." Thus the question of identity of the bond agreed to have been attached was open for parol proof on another trial. In this holding by the Court of Appeals, petitioner insists there was error.

The Court of Appeals cited in support of its holding Kyle v. Jordan, 196 Ala. 509, 511, 71 So. 417, 418, where it was said:

"There are contradictions, in express terms, between the recitals in the deed and those in the separate writing, as to both the parties to, and the consideration for, the deed. In the deed proper the grantee is described as M. Clonninger, and the consideration is stated to be $15 per acre, cash in hand paid; while in the separate writing the recital is that L. Clonninger is to pay $15 per acre. These are certainly contradictions in express terms. We are now of the opinion that there is no internal evidence of the identity and unity of the two writings as constituting a single transaction, sufficient to dispense with a reference in the deed to the separate writing. ***
"We still adhere to the former holding of this court that the rule is not absolute that the several papers shall, on their face, indicate a reference to each other, and that parol evidence may be admissible, in some cases, of contemporaneous facts, to show connection between the several writings; but to allow such proof, there must be some internal evidence of the identity and unity of the several writings as constituting a single transaction. This question was discussed, and the authorities were reviewed at some length, in Bryan's Appeal, 77 Conn. 240, 58 A. 748, 68 L.R.A. 353, 107 Am.St.Rep. 34, 1 Ann.Cas. 393."

This is the rule adhered to in this jurisdiction. Jones et al. v. Jones et al., 219 Ala. 62, 121 So. 78; Formby v. Williams,

203 Ala. 14, 81 So. 682.

In Butler Cotton Oil Co. v. Millican, 216 Ala. 472, 474, 113 So. 529, 530, touching the question and the value of the authority of Johnson v. Buck, 35 N.J.Law, 338, 10 Am.Rep. 243, Mr. Justice Sayre said:

"In the cited case [Johnson v. Buck, supra] plaintiff endeavored to remedy the defects in the memorandum made by recourse to the 'conditions of sale.' The court noted that, indeed, plaintiff's right to sue was derived exclusively from that source, and said:
" 'The difficulty in the way of resorting to the conditions in aid of the plaintiffs' case, lies in the fact that they cannot be connected with the signed memorandum without violating established principles of evidence with respect to transactions within the statute. The conditions were read at the sale, and contain internal evidence that they were intended for the sale in question, but were not signed by the defendant, and are in no wise referred to in the memorandum in the salesbook to which his signature was affixed.'
"The court continued:
" 'The connection between the signed and the unsigned papers cannot be made by parol evidence that they were actually intended by the parties to be read together, or of facts and circumstances from which such intention may be inferred. The connection between them must appear by internal evidence derived from the signed memorandum' (citing authorities).
"We have quoted thus at length from the New Jersey case because it contains a clear statement of the meaning and effect of the statute of frauds in a case very like the present. There is nothing new about this; it is as old as the statute. Browne, Statute of Frauds (5th Ed.) § 348. And this court has stated the doctrine in terms not easily misunderstood. Thus Stone, J., in Knox v. King, 36 Ala. 367, said:
" 'But, when
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5 cases
  • Waters v. W. O. Wood Realty Co., 6 Div. 320
    • United States
    • Alabama Supreme Court
    • January 21, 1954
    ...the reference was intended to apply, may be shown by parol evidence. That principle was reaffirmed in the case of Fidelity & Casualty Co. v. Raborn, 234 Ala. 31, 173 So. 402. The principle that a written contract supersedes all negotiations between the parties is inapplicable where those ne......
  • Borden v. Case
    • United States
    • Alabama Supreme Court
    • March 10, 1960
    ...the bar of the statute of frauds. There are also many other cases equally sustentive, some of which are: Fidelity & Casualty Co. of New York v. Raborn, 234 Ala. 31, 173 So. 402; Horton v. Wollner, Hirshberg & Co., supra; O'Barr v. Turner, 16 Ala.App. 65, 75 So. We attain the conclusion that......
  • Employers Ins. Co. of Alabama, Inc. v. Diggs
    • United States
    • Alabama Supreme Court
    • May 13, 1937
    ... ... A.L.R. 17; St. Louis Arch. Iron Co. v. New Amsterdam Cas ... Co. (C.C.A.) 40 F. (2d) 344; United States F. & G ... Co. v ... In the ... recent decision in United States Fidelity & Guaranty Co ... v. Hearn, 233 Ala. 31, 170 So. 59, the last-quoted ... Fidelity & ... Casualty Co. v. Raborn (Ala.Sup.) 173 So. 402, and ... authorities. This reference to the ... ...
  • Fidelity & Casualty Co. of New York v. Raborn
    • United States
    • Alabama Court of Appeals
    • April 20, 1937
    ...is a companion case to that of Fidelity & Casualty Company of New York v. William Raborn (Ala.App.) 173 So. 399, certiorari denied (Ala.Sup.) 173 So. 402. The two cases were jointly tried, are here submitted on separate records and involve the same questions on appeal, thus rendering a deci......
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