Kernochan v. Murray

• Decision Date: 27 November 1888
• Citation: 18 N.E. 868,111 N.Y. 306
• Parties: KERNOCHAN v. MURRAY et al.
• Court: New York Court of Appeals Court of Appeals

111 N.Y. 306

18 N.E. 868

KERNOCHAN

v.MURRAY et al.¹

Court of Appeals of New York.

November 27, 1888.

Appeal from general term, First department.

In August, 1871, the firm of De Mill & Co., composed of Richard M. De Mill (defendant's testator) and Thomas A. De Mill, sold to John A. Kernochan (plaintiff's intestate) 40 shares of stock of an incorporated company, known as the ‘Albemarle Swamp Land Company,’ Mr. Kernochan paying to said firm $3,200, the agreed price, and receiving from said firm a certificate for said shares made out in his (Kernochan's) name on its face, and said Kernochan at the same time receiving from said firm the following agreement in writing: ‘In consideration of your having purchased, upon my representation as to their value, forty shares of the capital stock of the Albemarle Swamp Land Company, and of one dollar to me in hand paid, I do hereby guaranty that you shall receive, as long as you hold said stock, dividends equal to seven per cent. per annum, or I will make good to you all deficit in such amount. DE MILL & COMPANY, New York, August 21, 1871. Witness: JOHN S. LENG.’ This agreement was signed with the firm name by Thomas A. De Mill, one of the members of said firm; it was ratified by Richard M. De Mill, the other member; and for several years after Thomas A. De Mill's death he (Richard) made the payments called for by the agreement. Richard De Mill subsequently refused to make the payment called for by the agreement, and upon such refusal suit was brought for the amount due August 1, 1882. Judgment was given in favor of Kernochan. The case was carried on appeal to the general term of the supreme court. This judgment was sustained, and, no further appeal being taken, the amount of the judgment was paid by the executors of Richard M. De Mill, he having died during the litigation. Demand was then made by Kernochan upon the estate of Richard M. De Mill for the amounts coming due under said agreement for the two years next succeeding, namely, 1883 and 1884. Payment was refused. Suit was again brought by Kernochan in the supreme court in the county of New York on trial before a judge and jury. A verdict was directed for the defendant on the ground that the guaranty was a personal one, and was revoked by the death of the guarantor. This was sustained by the general term, First department, and appeal taken to this court by Louise M. Kernochan, administratrix of John A. Kernochan, who had died in the mean time.

William G. Alger, (J. Frederic Kernochan, of counsel,) for appellant.

Sidney V. Lowell, for respondents.

ANDREWS, J.

We think the judgment below proceeds upon a misconstruction of the contract of guaranty. The guaranty did not in terms purport to bind the executors or administrators of De Mill & Co. But it is a presumption of law, in the absence of express words, that the parties to a contract intend to bind, not only themselves, but their personal representatives. 2 Pars. Cont. 530, and cases cited; 2 Co. Litt. 209 a. In case of a contract for the payment of money, or the sale or purchase of property, or of a covenant of warranty, it would be an unreasonable supposition that the parties intended that the obligation should not survive against their representatives, although not specially named. It is of course competent for parties to agree that a contract shall not survive, and that all obligation under it should terminate on their death. So a contract may be of such a nature as to admit only of a personal performance, or as to imply that it is to be operative only during the continuance of personal relations, although not so expressed in terms, and will be deemed dissolved by death or other disability which renders performance according to the intention impossible. Contracts for the...