Mills v. Travis

• Decision Date: 09 February 1894
• Citation: 56 Minn. 480,58 N.W. 36
• Parties: WINNEBAGO PAPER MILLS v. TRAVIS.
• Court: Minnesota Supreme Court

56 Minn. 480

58 N.W. 36

WINNEBAGO PAPER MILLS

v.TRAVIS.

Supreme Court of Minnesota.

Feb. 9, 1894.

(Syllabus by the Court.)

1. To charge a guarantor upon a letter of guaranty addressed to a particular person, or to persons generally, for a future credit to be given the party in whose favor, and at whose request, the letter was drawn, and to whom it was delivered by the guarantor, notice must be given, within a reasonable time, to the latter, that the person giving the credit has accepted or acted upon the guaranty, and has given credit on the faith of it. Such notice need not be in any particular form, and may be inferred from facts and circumstances.

2. The rule laid down in Hersey v. Bennett, 28 Minn. 86, 9 N. W. 590, as to the application of payments upon an open, continuous account consisting of many items, no appropriation being made by either party, followed and applied.

Appeal from district court, Hennepin county; Henry G. Hicks, Judge.

Action by the Winnebago Paper Mills against John F. Travis to recover on a written guaranty. Judgment was ordered for defendant, and, from an order denying a new trial, plaintiff appeals. Affirmed.

C. E. Brame, for appellant.

Edward H. Crooker, for respondent.

COLLINS, J.

According to the findings of the trial court in this action, one Jordan was indebted to plaintiff in the sum of $2,273.86 on account of paper sold and delivered prior to January 23, 1888. On that day defendant, at Jordan's request, executed and delivered to him a writing in the following words: “Minneapolis, Minn., January 23d, 1888. To the Winnebago Paper Mills, Neenah, Wis.: R. H. Jordan, of Minneapolis, Minnesota, being indebted to you for paper sold him heretofore, and desiring to purchase paper upon credit from you from time to time in the future, I, for value received, guaranty the payment of R. H. Jordan's account with you as it now exists, until further notice, to the amount of two thousand dollars. John F. Travis. [Seal.]” Jordan afterwards delivered this writing to plaintiff, and, relying upon it, there was sold and delivered to him, between its date and the 20th day of December, 1889, paper of the value of $27,067.22, and payments made from time to time, on account, to the amount of $18,105.09. The sales made prior to, or the items which constituted the indebtedness existing at, the date of the writing, and the sales made or the items which made up the indebtedness accruing after the execution of the writing, were and are one continuous account, the sales or items first mentioned being the first items in the account. When payments were made amounting to over $18,000, as before stated, no special appropriation thereof was made by either debtor or creditor, but each payment was credited as a payment on account in the ordinary way. No consideration for the execution and delivery of the writing was shown except future sales to Jordan, on credit, made by plaintiff. The court also found that defendant never had any notice or knowledge that plaintiff had accepted the so-called “guaranty,” or that it would, or had, made any sales relying on the same, until about August 1, 1892, some 4 1/2 years after its execution, and 2 1/2 years after the last sale was made to Jordan. Meantime the latter had become insolvent. There were other findings not necessary to consider, as we regard the case. Judgment was ordered for defendant, and plaintiff appeals from an order denying its motion for a new trial.

1. We shall first dispose of the question whether defendant guarantor was entitled to notice, within a reasonable time, that his letter of guaranty, so far as it related to future sales, had been accepted by plaintiff, (guarantee,) and had been, or would be, acted upon by sales to Jordan on credit and upon faith of it. It is not claimed that notice was given within a reasonable time, or that such...