Mamerow v. Nat'l Lead Co.

• Decision Date: 16 December 1903
• Citation: 69 N.E. 504,206 Ill. 626
• Parties: MAMEROW v. NATIONAL LEAD CO.
• Court: Illinois Supreme Court

206 Ill. 626

69 N.E. 504

MAMEROW

v.NATIONAL LEAD CO. ^*

Supreme Court of Illinois.

Dec. 16, 1903.

Error to Appellate Court, First District.

Action by the National Lead Company against George Mamerow. From a judgment in favor of plaintiff, affirmed by the Appellate Court (98 Ill. App. 460), defendant brings error. Affirmed.Benson Landon, for plaintiff in error.

Tenney, McConnell, Coffeen & Harding, for defendant in error.

This is a writ of error to the Appellate Court for the First District to review a judgment of that court affirming a judgment of the superior court of Cook county in a suit brought by defendant in error against plaintiff in error to recover a balance for goods sold by defendant in error to a corporation known as the Berner-Mayer Company upon a written guaranty executed by plaintiff in error and others to defendant in error. The guaranty in question is as follows:

‘Agreement made this 19th day of March, 1897, between Herman D. Berner, residing at 2673 Euclid avenue, in the city of Cleveland, Ohio, and Jacob J. Mayer, residing at the Arlington Hotel, in the city of Cleveland, Ohio, and George Mamerow, residing at Irving Park, in the city of Chicago, Illinois, parties of the first part, and the National Lead Company, a corporation of New Jersey, doing business at No. 287 Pearl street, in the city of New York, of the second part:

‘Witnesseth: Whereas, the Berner-Mayer Company, a corporation organized under the laws of Ohio and doing business in the city of New York and at Cleveland, Ohio, is indebted to the National Lead Company in various sums of money for goods sold and delivered on open account and for other accounts; and whereas, the said National Lead Company has called upon the said the Berner-Mayer Company for security for its indebtedness to said National Lead Company, and has refused to permit the indebtedness of the said the Berner-Mayer Company to increase until the said present indebtedness is amply secured; and whereas, the said parties of the first part are interested in the said the Berner-Mayer Company as stockholders and directors thereof, and desire that the said National Lead Company shall continue to sell goods to the said the Berner-Mayer Company, and have requested it so to do; and whereas, the parties of the first part have agreed to furnish the said National Lead Company security for all accounts due and to become due from said the Berner-Mayer Company to said National Lead Company:

‘Now, therefore, in consideration of the foregoing, and in consideration of the sum of one dollar and other valuable consideration to the parties of the first part in hand paid by the parties of the second part at or before the ensealing and delivering of these presents, the said parties of the first part do jointly and severally, and for their heirs, executors and administrators, guarantee to the said National Lead Company the payment to said National Lead Company, upon demand, of all moneys, debts, obligations and demands, of whatever nature or character, now due or which may hereafter become due from said the Berner-Mayer Company to the said National Lead Company.

‘In witness whereof the said parties of the first part have hereunto set their hands and seals this 19th day of March, 1897.

‘Herman D. Berner.

‘Jacob J. Mayer.

‘George Mamerow.

‘In the presence of R. M. Morley.’

To the declaration in assumpsit the plaintiff in error pleaded only the general issue, with an affidavit of merits. The cause was submitted to the court, a jury having been waived; and the issues were found in favor of defendant in error, and damages were assessed at $4,778.71. The action was for goods sold under the guaranty between the 19th day of March, 1897, and the 9th day of November, 1897.

It appeared from the evidence that the Berner-Mayer Company was an Ohio corporation, with places of business at Cleveland, New York, and Brooklyn. The items for which the plaintiff in error was held liable under the guaranty were all sold and delivered to the New York and Brooklyn branches on 30 days' credit. The company made an assignment for the benefit of its creditors December 17, 1897. The questions presented here were raised by holdings offered by the plaintiff in error, and refused by the trial court.

RICKS, J. (after stating the facts).

Plaintiff in error's contention is that the superior and appellate courts erred in construing the guaranty to cover purchases made by the Berner-Mayer Company after March 19, 1897-the date of the guaranty. This question was raised by a holding, presented to the court and refused, to the effect that the guaranty only covered all indebtedness existing at the time of its date. This contention, we think, is without merit. The preamble of the instrument recites that the parties to the guaranty ‘desire that the said National Lead Company shall continue to sell goods to the said Berner-Mayer Company, and have requested it so to do,’ and the language of the guaranty itself purports to cover all debts, of whatever nature or character, ‘now due or which may hereafter become due from said Berner-Mayer Company to the said National Lead Company.’ As was said by the Appellate Court: ‘Looking at the instrument as a whole, it is certainly open to the construction that it was intended to cover debts not only due, but which might become due thereafter, in pursuance of the express wish of the guarantors that the lead company should continue to sell goods to the Berner-Mayer Company. It cannot fairly be said that the recitals limit the guaranty to said present indebtedness, as counsel contends.’

It is next urged that the guaranty in question does not apply to or cover sales made by the defendant in error to the Berner-Mayer Company upon 30 days' credit, and that, as the entire demand is for goods so sold, the defendant in error ought not to recover on the guaranty. This question was raised in the trial court by plaintiff in error requesting the court to hold, as a matter of law, that plaintiff in error was not liable to defendant in error ‘for goods sold and delivered by said National Lead Company to the Berner-Mayer Company upon thirty days' credit.’ This holding the court refused. In support of this contention, plaintiff in error cites Miller v. Stewart, 9 Wheat. 680, 6 L. Ed. 189,Shreffler v. Nadelhoffer, 133 Ill. 536, 25 N. E. 630,23 Am. St. Rep. 626, and other cases, wherein the propositions are announced and held that the ‘liability of a surety is not to be extended by implication beyond the terms of the contract,’ and that the surety or guarantor will not be held answerable unless the contract is strictly pursued. We are unable to see how this court is aided, or plaintiff in error benefited, by the rules here invoked. They can only be applied when it is determined what is the legal effect of the guaranty in question, or, in other words, the scope of the undertaking of the guarantors. The contract must be construed by and from its own terms and provisions, as far as they furnish a guide, and in aid thereof the circumstances of the making of the contract may be taken into consideration. By the express words of the contract, the makers guaranty the ‘payment, upon demand, of all moneys, debts, obligations and demands, of whatever nature or character, now due or which may hereafter become due from the Berner-Mayer Company.’ The language is broad, and, if given the interpretation it would usually import, must be held to cover not only the indebtedness existing at the time of the execution of the guaranty, and which might then be due or might thereafter become due, but also such indebtedness as might, in due course of trade, thereafter be created and become due. If a guaranty is clear in its terms, it must be interpreted and construed according to the language used; ‘that is to say, the parties must be presumed to have meant that which their language clearly imports. It is not what one of the parties may have intended, but what is shown by the contract to have been the intention of both parties.’ Peoria Savings, Loan & Trust Co. v. Elder, 165 Ill. 55, 45 N. E. 1083.

Upon examination of the contract in question, it appears from its recitals that defendant in error had sold and delivered goods to the Berner-Mayer Company on open account, and that the latter owed the defendant in error for goods so sold and for other accounts. It also appears that the guarantors were ‘interested in the said Berner-Mayer Company, as stockholders and directors thereof’; that defendant in error had refused to permit the indebtedness of the Berner-Mayer Company to increase until the present indebtedness was amply secured; that the guarantors desired that the defendant in error should continue to sell goods to the said Berner-Mayer Company, and so requested; that the guarantors agreed to furnish to defendant in error security of all accounts, ‘due and to become due.’ From these recitals, it is evident that plaintiff in error and his co-guarantors knew not only that defendant in error had been selling the Berner-Mayer Company goods upon open account, but that these accounts so existing comprised both classes of debts; that is, those that were due, and those that were not due, but were to become due. Furthermore, as directors of the Berner-Mayer Company, it was the duty of the guarantors to have knowledge of its affairs, and the nature, extent, and character of its indebtedness, and the recitals of their undertaking tend most strongly to show that they did know. They desired defendant in error to continue to extend credit to the Berner-Mayer Company, and agreed that they would, on demand, pay defendant in error all moneys, debts, obligations, and demands, of whatever nature or character, then due, or that might thereafter become due. Their guaranty was not, by such language, limited to sales on open account that should be payable by the Berner-Mayer Company upon demand of defendant in error, but ‘moneys, debts,...