Guar. Sec. Corp. v. Oppenheimer

• Decision Date: 04 January 1923
• Citation: 137 N.E. 644,243 Mass. 324
• Parties: GUARANTY SECURITY CORPORATION v. OPPENHEIMER et al.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

243 Mass. 324

137 N.E. 644

GUARANTY SECURITY CORPORATION

v.OPPENHEIMER et al.

Supreme Judicial Court of Massachusetts, Suffolk.

Jan. 4, 1923.

Exceptions from Superior Court, Suffolk County; Frederick Lawton, Judge.

Action of contract by the Guaranty Security Corporation against Johanna Oppenheimer and others to recover the penal sum of a bond given by defendants, as sureties, and one Benjamin Dellheim, as principal, to dissolve an attachment. Directed verdict for plaintiff, and defendants bring exceptions. Exceptions overruled.

It was admitted that Dellheim had been adjudicated a bankrupt, and that he acted in good faith in filing his petition and obtaining such adjudication, and that no other question of fact was involved. Defendant moved for a directed verdict, and also requested rulings and instructions raising questions as to the effect of the bankruptcy, and excepted to the refusal of such motion and requests, and also to the admission of Dellheim's testimony given after the case was reopened, that he had not paid the judgment, or any part thereof, within 30 days of the date when it was rendered.Fred L. Norton, of Boston, for plaintiff.

Nathan Barnett, of Boston, for defendants.

RUGG, C. J.

[1] This is an action of contract against sureties upon a bond given on May 2, 1921, to dissolve an attachment made in an action against one Dellheim. Judgment was entered in that action in favor of the plaintiff on July 18, 1921. On the thirtieth day thereafter Dellheim in good faith filed a voluntary petition in bankruptcy, scheduled the plaintiff as a creditor, and subsequently was adjudged to be a bankrupt. The condition of the bond (so far as here material) was that Dellheim should pay to the plaintiff the amount, if any, that it might recover, within 30 days of the final judgment. There was no compliance with this condition.

The sureties are not relieved from liability on these facts. There is no limitation in the terms of the bond upon the absolute liability of the sureties if the judgment shall not be paid as required. The possibility of bankruptcy was in the minds of the parties because there is a provision in the bond concerning special judgment under G. L. c. 235, § 25. If it had been their intention to qualify the liability of the sureties in case bankruptcy of the principal should occur within four months of its date, apt language to that effect should have been inserted in the bond.

[2][3] The attachment was dissolved by giving the bond. The lien acquired by the attachment was gone when the bond was delivered. The bond was not given for the property, nor as security for its value. It was a new obligation not liable to be discharged by the death or insolvency of the debtor. Carpenter v. Turrell, 100 Mass. 450, 452. It was said in Tapley v. Goodsell, 122 Mass. 176, 182:

‘The bond is not affected by contingencies which might have discharged the attachment, if no bond had been given. Neither death nor bankruptcy of the principal discharges the surety from his obligation to satisfy a judgment lawfully rendered against the principal or his representatives; but such judgment, in the absence of fraud or collusion, is conclusive against the surety.’

This is controlling of the case at bar under our law. Cutter v. Evans, 115 Mass. 27;Bernheimer v. Charak, 170 Mass. 179, 49 N. E. 81;Rosenthal v. Nove, 175 Mass. 559, 56 N. E. 884,78 Am. St. Rep. 512.

There is nothing in the national Bankruptcy Act (U. S. Comp. St. §§ 9585-9656) which relieves the sureties or affects their liability as established by the law of this commonwealth. While an attachment made within four months theretofore is dissolved by the bankruptcy of the debtor, there is no similar provision with respect to sureties upon bonds...