Henry v. W. T. Rawleigh Co.

• Decision Date: 28 January 1929
• Docket Number: 27475
• Citation: 120 So. 188,152 Miss. 320
• Court: Mississippi Supreme Court
• Parties: HENRY et al. v. W. T. RAWLEIGH CO. [*]

120 So. 188

152 Miss. 320

HENRY et al. v. W. T. RAWLEIGH CO. ^[*]

No. 27475

Supreme Court of Mississippi

January 28, 1929

Division A

1 GUARANTY. Guarantors were not liable if induced to sign guaranty because of false representations that principles owed nothing.

In action to recover on an open account sold to one defendant by virtue of a letter of guaranty signed by other defendants, a demurrer was erroneously sustained to plea containing statement that guarantors were induced to sign the writing on the statement of plaintiff's agent that the principal at that time did not owe the plaintiff anything, which statement was false and known to be false by the agent, but not known by the guarantors, and that they were induced to s'gn guaranty because of said representations.

2 EVIDENCE. Parol evidence is admissible to show that contract was procured by fraudulent representations.

Generally parol evidence is permissible to show that the making of a contract was procured by fraudulent representations, in that such evidence does not change the contract, but destroys and avoids it.

3 GUARANTY. Fraud vitiates contract of guaranty.

Fraud in connection with contract of guaranty vitiates the contract.

4. EXECUTORS AND ADMINISTRATORS. Law requiring claims to be probated within one year applies only to claims on which suit was not brought during decedent's lifetime (Hemingway's Code 1927, sections 1836, 1851).

Hemingway's Code 1927, section 1851 (Code 1906, section 2107), requiring all claims against estate of deceased person to be registered, probated, and allowed within, one year, applies, when construed with Code 1906, section 2093 (Hemingway's Code 1927, section 1836), only to claims on which suit has not been instituted during lifetime of deceased.

HON. EARL RICHARDSON, Special Judg.

APPEAL from circuit court of Newton county, HON. EARL RICHARDSON, Special Judge.

Action by the W. T. Rawleigh Company for plaintiff, and defendants appeal. Reversed and remanded.

Case reversed and remanded.

J. L. Byrd and C. E. Johnson, for appellants.

We recognize the rule long established in all of the courts of the land that parol, contemporaneous testimony is inadmissible to change, alter or vary the terms of a valid written instrument, but we do not conceive it to be the law that fraud practiced in the procurement of the signature of a person to a written instrument cannot be proven by parol testimony. See Ganley Bros. Inc. v. Butler Bros. Building Co., 56 A. L. R. 1; Arnhold v. Nat. Aniline & Chemical Co., 56 A. L. R. 4. See also extensive note in 56 A. L. R. 13; Patten-Worsham Drug Co. v. Planters Merchantile Co., 86 Miss. 423, 38 So. 209; Howie Bros. v. Walter Pratt & Co., 83 Miss. 15, 35 So. 216; Wren v. Hoffman, 41 Miss. 620; Hawkins v. Shields, 100 Miss. 739, 57 So. 4.

The special plea of the administratrix was demurred to and the demurrer sustained, the court holding that it was not necessary to probate and register a claim against the estate of a deceased person where such claim had been sued on prior to such person's death, following the case of Dillard & Coffin Co. v. Woollard, 124 Miss. 677, 87 So. 148, which case holds that the statute requiring all claims to be registered does not require claims upon which suit has been brought to be registered and probated. Sec. 1851, Hem. Code 1927, provides that all claims against the estate of a deceased person shall be registered, etc., and the statute further says that "otherwise the same shall be barred and a suit shall not be maintained thereon in any court, even though the existence of the claim may have been known to the executor or administrator." This language is clear, positive and unequivocal, and for the above-reported case to be sustained something must be written into the statute which is not there, and the legislature in 1926 amended the very statute in question and did not except therefrom claims on which suits were pending at the time of the death of the deceased person. We respectfully submit that this case is not sustained by a careful examination of the statute, and that the plain mandate of the statute is that all claims must be registered, probated and allowed.

D. M. Anderson and G. H. Banks, for appellee.

The court did not commit error in sustaining the demurrer to the special plea of the administratrix. This was a pending cause of action against defendant, E. J. Pearson, at the time of his death and was, therefore, such a claim as was not required to be probated, allowed and registered under our statutes. The case of Dillard & Coffin Co. v. Woollard, 124 Miss. 667, 87 So. 148, is squarely in point on this question and decisive of the matter. Also, the claim was a "contingent liability" and clearly one of that class not required to be probated under the rule announced by this court in Bobinette v. Starling, 72 Miss. 652, 18 So. 421, and in Savings Building & Loan Association v. Tart, 81 Miss. 276, 32 So. 115. See, also, on this point Harris v. Hutcheson, 3 So. 34, 65 Miss. 9; Gordon v. Gibbs, 3 S. & M. 473.

In Chicago Building & Mfg. Co. v. Higginbotham, 29 So. 79, it was held that: "A written contract cannot be varied by a previous or contemporaneous oral agreement as to its scope and binding form." Lange Med. Co. v. Johnson, 197 S.W. 1168, (Ark.) it was held that a surety on a bond cannot avoid liability on the ground of fraudulent representations as to its scope, its terms being plain and unambiguous. In the case at bar appellants plead merely that appellee's agent at the time they executed the contract falsely represented that Henry owed the company "nothing." They actually signed a contract of guaranty which obligated them to pay what was due and owing at the time of the contract's acceptance, and what might become due and owing in the future. They were misled, as to the scope and binding form of the instrument and not as anything material in the contract. See Houck v. Wright, 23 So. 442. The appellants unconditionally guaranteed the payment of the amount due at the time of the acceptance of the contract and also what amount might become due in the future. The guaranty undertaking is unconditional and absolute. The engagement is "that any statement or representation made by any person as to the undertakings of the guarantor or guarantors other than as herein expressed . . . in order to become effective and binding upon the above-named seller shall be reduced to writing and delivered by registered mail to the office of the said seller at Memphis, Tennessee.

OPINION

MCGOWEN, J.

The appellee, the W. T. Rawleigh Company, filed its declaration in the circuit court of Newton county against the appellants, W. C. Henry and others, on the open account of W. C. Henry for goods sold him by virtue of a letter of guaranty signed by E. J. Pearson and T. C. and A. E. Butts, in which these named parties guaranteed unconditionally the payment of Henry's account with the Rawleigh Company, then due or owing, or any sum that might become due or owing, and all indebtedness incurred by Henry in the course of the contract between the Rawleigh Company and Henry, as seller and buyer.

In addition to this, the following clause was in the letter of guaranty, exhibited as part of the declaration, and as part of the ground of this suit: "It is hereby mutually understood and agreed that this contract of guaranty is conclusive and binding on the party or parties who sign it whether the same is signed by any other party or parties or not, and that any statement or representation made by any person as to the undertakings of the guarantor or guarantors other than as herein expressed, or as to who or how many parties are to sign this guaranty, shall in no wise affect the rights of the company; and it is mutually understood that...