Saylor v. Culver

• Decision Date: 20 June 1882
• Docket Number: Case No. 3483.
• Court: Texas Supreme Court
• Parties: LANE & SAYLOR AND J. H. ROBINSON v. SCOTT & CULVER.

57 Tex. 367

LANE & SAYLOR AND J. H. ROBINSON

v.SCOTT & CULVER.

Case No. 3483.

Supreme Court of Texas.

Jun. 20, 1882.

APPEAL from Travis. Tried below before the Hon. E. B. Turner.

Suit by M. S. Culver and James F. Scott, on the bond of R. N?? Lane and W. A. Saylor, with J. H. Robinson as surety, conditioned that Lane and Saylor comply with the terms of their agreement with Culver and Scott, made the same day. By the terms of that agreement, Culver and Scott were to deliver four thousand beef cattle of specified quality, at Houston, as follows: Five hundred on July 1st; five hundred on July 15th; one thousand on August 15th; one thousand on September 15th; and one thousand on October 15, 1873; it being specified that three days were to be allowed after each day, to complete the delivery. Lane and Saylor agreed to pay at the rate of sixteeen dollars per head on the delivery of each lot. The agreement provided that each party was to enter into bond, with sureties, in the sum of $5,000, for the faithful performance of their stipulations.

Before the 1st of July, the time for the delivery of the first lot, Lane and Saylor requested the postponement of any delivery until July 25th, and the plaintiffs both testified that they delayed the delivery because of that request.

The amended petition of plaintiffs alleged a tender or offer to deliver one thousand cattle on July 25th, and the refusal of defendants to receive them.

The defendants denied the allegations of the original and amended petition; and the defendant Robinson, under oath, pleaded that he was only surety, and that the contract had been altered without his knowledge or consent.

The jury found for the amount of the bond against all of the defendants, and judgment was rendered accordingly. A motion for new trial was overruled, and defendants appealed.

Terrell & Walker and H. L. Bentley, for appellants.--The extension of the time for delivery of the first two lots of cattle was a material alteration of the contract, and not being consented to by Robinson, was not binding upon him. The alteration discharged the bond. They cited Yeary v. Smith, 45 Tex., 71;Claiborne v. Birge, 42 Tex., 102, and other Texas cases. Also, Story on Con., sec. 870; Chitty on Con., pp. 460-462; 3 Parsons on Con., 15, 720, 721; 1 Smith's Leading Cases, 956, 965, 966 (note, Master v. Miller); Wright v. Johnson, 8 Wend., 512;Dobbin v. Bradley, 17 Wend., 422;Berkhead v. Brown, 5 Hill, 641;6 Hill, 540, 543.

Shelly & Moore, for appellees.--The pleadings of the plaintiff are sustained by the facts proved. J. F. Scott, one of the plaintiffs, testified that he delayed delivering the first cattle by request of Saylor, by dispatch dated 13th of June, till 8th of July, and next by dispatch dated 27th of June, till 25th of July. The dispatches referred to read as follows:

“Austin, 13, 187-. To M. S. Culver, Banquette, care of D. Hirsch: Delay delivery of first lot to 8th July, if you can. Will suit all parties. W. A. SAYLOR.”

“Dated Austin, Texas, 27, 187-. Received at C. C., June 28th. To M. S. Culver & Co.: Arrangement made; deliver first five hundred 25th July; write fully. W. A. SAYLOR.”

Culver testified that there was a change made of the time of delivery of the cattle at the instance and request of Saylor, to suit their convenience. I received several telegrams from Austin about the matter in June, 1873. The reason, as I understood, the cattle were not received by Lane and Saylor, was their failure and inability to pay for them as they contracted to do.

This testimony is not contradicted by the defense.

The question then presented by the pleading and facts is this: A voluntary extension of time to the principal, though given without the surety's consent, will not release him. To release the surety the extension of time must be by a valid and binding contract. Frois v. Mayfield, 33 Tex., 804;Hunter v. Clark, 28 Tex., 162;Payne v. Powell, 14 Tex., 601;Cruger v. Burke, 11 Tex., 694;Burke v. Cruger, 8 Tex., 66;McKecknie v. Ward, 58 N. Y. 541.

In the case of McKecknie v. Ward, 58 N. Y., 541, which was an action on a bond, W. became surety on the bond of B. for the performance of an agreement between B. and plaintiffs, whereby “the agency for the sale of their ales” at S. was let to B., he agreeing to pay on the first of each month for the amount of ale delivered, and “not to purchase” ale of any but plaintiffs. The agreement might be terminated on three months' notice by either party. It was held that W. was not discharged as surety, although plaintiffs neglected or forebore to enforce full payment at the times stated in the agreement, and did not give notice to W. that B.'s account was in arrears. See, also, Clarke v. Sickler, 64 N. Y., 231;State v. Manning, 55 Mo., 142;Abel v. Alexander, 45 Ind., 523?? Parnham Sewing Machine Co. v. Brock, 113 Mass., 194.

BONNER, ASSOCIATE JUSTICE.

The charge of the court upon the question of the change of time for the performance of the contract, as it affected the liability of the surety, Robinson, is as follows: “Parties may change their contracts after they are entered into, and an extension of time does not necessarily release a surety; it would release him, provided he was injured by such extension, or if it appears from the evidence that the surety was put in any worse condi??than he would otherwise have been.”

This charge was excepted to at the time upon the following among other grounds: “2. The charge is defective in submitting to the jury whether the surety was injured by the extension, to determine whether the alteration was material.”

In addition to this defendant Robinson asked special charges, which were refused, to the effect that any material alteration in the term of the contract between plaintiffs Culver and Scott, and his principals, Lane and Saylor, without the consent of the surety, Robinson, would release him; and that the changes in the dates of the time of performance were material and would discharge him. These questions are presented by the assignment of errors, and are the material ones for our decision.

The statement of a few well established general propositions will aid in the proper disposition of this case.

Although a mere gratuitous indulgence by a creditor to the principal debtor--unless when demand is made under our statute (R. S., arts. 3660, 3661), by the surety upon the creditor, to institute proceedings--will not discharge the surety, for the reason that the latter has the right to pay off the debt, and be subrogated to the rights of the creditor, yet a valid agreement between the creditor and the principal, made without the consent of the surety, to extend the time of payment or performance for any definite period, will discharge the surety. This rests upon the reason that the surety, who, as such, derives no benefit from the contract, has the right to stand upon its terms strictly as made, and that to change them without his consent makes a new contract to which he is not a party, and which, consequently, is not binding on him. The inducement to have become surety, in the first instance, may have been that, if the contract should be carried out as originally made, he had the means for his own protection, when, if changed, his rights might be prejudiced. One of the essential elements of the contract of suretyship is the equity of the surety, which depends not so much on his relations with the creditor as on his right to indemnity from his principal, and the consequent obligation on the part of the creditor not to do any act by which this right might be prejudiced. The surety had the right to be subrogated to all the rights and privileges which the creditor had when the original contract was made. The creditor had the right to enforce his legal remedy, by suit or otherwise, as soon as the debt or cause of action became due; and the surety, therefore, had the consequent right, on failure of payment or performance on the part of his principal, to resort to a court of equity to enforce the terms of the contract on the part of the principal, or to discharge the obligation in the first instance, and thereby become subrogated to this right of the creditor to sue. This, however, he could not do, if, in the meanwhile, the creditor had made a binding agreement, varying in an essential particular the original contract. In such case the surety is not bound by that contract, for it has ceased to exist; nor by the new...