Ives v. Williams

• Decision Date: 01 October 1925
• Citation: 129 S.E. 675
• Parties: IVES et al. v. WILLIAMS.
• Court: Virginia Supreme Court

129 S.E. 675

IVES et al.

v.WILLIAMS.

Special Court of Appeals of Virginia.

Oct. 1, 1925.

[Ed. Note.—For other definitions, see Words and Phrases, First and Second Series, Absolute Guaranty.]

Error to Circuit Court of City of Norfolk.

Action by notice of motion by J. T. Williams against Preston W. Ives and another. Judgment for plaintiff, and defendants bring error. Affirmed.

Eastwood D. Herbert, of Norfolk, for plaintiffs in error.

W. H. Starkey and J. M. Arnold, both of Norfolk, for defendant in error.

CRUMP, P. In June, 1920, Preston W. Ives was the owner of approximately 250 acres of land in Princess Anne county, Va., upon which there was a mortgage or deed of trust held by C. E. Herbert. In the month of June, Ives sold and conveyed to J. T. Williams 175 acres of the said tract for the sum of $10,500, of which $3,000 was paid in cash and a note payable in two years was given for $7,500. This entire consideration went to C. E. Herbert so that he might release his lien as to the 175 acres, and a deed of trust was given to secure Williams' note for $7,500 of which C. E. Herbert became the holder. The deed from Ives to Williams contained a reservation to the grantor of the right to cut timber from the land conveyed for a period of two years. At the time of the sale Ives agreed to furnish certain lumber to Williams. This agreement was put in writing, and its performance was guaranteed by C. E. Herbert. The writing was in the form of a communication addressed to Williams, and, together with the guaranty, is as follows:

"In consideration of $10 and other good and valuable considerations, the receipt of which is hereby acknowledged, I agree to furnish the lumber to build a six (6) room house and piazza on the farm you purchased from me by deedof June 29, 1920. All weather boarding to be dressed on one side; all flooring to be dressed on one side and tongue-and-grooved, and sheathing and framing are not to be dressed. This agreement shall not include the shingles for the roof. The order for said timber must be given 90 days prior to the expiration of the said two years, and said timber is to be delivered within 90 days from the receipt of order.

"[Signed] Preston W. Ives.

"For value received I hereby guarantee the faithful performance of the above agreement.

"[Signed] C. E. Herbert."

In accordance with the agreement Williams gave Ives an order for the lumber 90 days prior to the expiration of the two years. It was claimed by Williams that Ives failed altogether to furnish the lumber. He thereupon instituted this action by notice of motion in June, 1923, against both C. E. Herbert, the guarantor, and Preston W. Ives, the debtor. Upon a trial before a jury a verdict was rendered against both defendants for $1,050 as damages for failure to perform the eon-tract. Judgment was entered upon the verdict, to which a writ of error was allowed by the Supreme Court of Appeals upon the petition of P. W. Ives and C. E. Herbert.

The plaintiffs in error, the defendants in the court below, assign as errors the action of the court in the following particulars, viz., in overruling the demurrer of the defendant guarantor, C. E. Herbert, to the notice of motion; the refusal of the court to give two instructions offered by the defendants on the trial; and also the refusal of the court to set aside the verdict on the ground that it was contrary to the law and the evidence.

Upon the three assignments of error the following questions are raised for decision by this court:

The plaintiffs in error contend (1) that the plaintiff in the case failed to allege and prove that he had exhausted his legal remedies against the defendant P. W. Ives, and that such allegations and proof were essential for him to maintain an action against C. E. Herbert on his contract of guaranty; (2) that the plaintiff failed to allege and prove that he had given to Herbert, the guarantor, timely notice of the default on the part of P. W. Ives to perform his contract with the plaintiff, and that such allegations and proof were essential before an action could be maintained against Herbert, the guarantor; (3) that the action could not be maintained against the primary debtor, Ives, and the guarantor, Herbert, jointly, as the contract with Ives and the guaranty with Herbert were independent undertakings, and the liability of each of the parties was several, and therefore the separate demurrer of Herbert should have been sustained.

Without considering each assignment of error separately, the foregoing three points, when decided by the court, will dispose of all the errors upon which the plaintiffs in error rely.

Guaranties in general may be classified either as absolute or conditional. The guaranty in this case is unquestionably an absolute guaranty. The contract provides for a certain, definite, and specific act of performance to be had by the debtor, and the performance of that act is guaranteed by Herbert without any condition of any character being annexed to it. Herbert guarantees the faithful performance of Ives' promise to furnish the lumber. Immediately upon the failure of Ives to perform his contract by furnishing the lumber, there has been failure of performance of the act which Herbert had guaranteed should be performed, and his liability for the failure to perform arises at once and unconditionally. An absolute guaranty is generally said to be one by which the guarantor unconditionally promises payment or performance of the contract on default of the principal debtor or obligor, and while the most usual form of an absolute guaranty is that of payment, still, an absolute guaranty of performance is subject to the same rules as the guaranty of payment. It is further said that a guaranty is deemed to be absolute unless its terms import some condition precedent to the liability of the guarantor. 28 C. J. 895, 972.

It is well settled in the law of guaranty that when the guarantor enters upon an absolute guaranty the creditor is under no obligation to first endeavor to collect from the debtor, nor is he under obligation to give notice to the guarantor of default on the part of the primary debtor. When the guaranty is absolute, as in this case, whether the contract of guaranty covers the performance of an act or the payment of money at a definite time, the liability of the guarantor is distinguished from a mere guaranty of solvency or collectability, which is conditional in its nature or which may arise out of a continuing guaranty.

The prevailing doctrines of the law in these matters are very well stated in the case of Heyman v. Dooley, 77 Md. 162, 26 A. 117, also reported in 20 L. R. A. 257. In that case the court says:

"The liability of an indorser of a negotiable note does...