Scharnagel v. Furst

• Decision Date: 24 March 1927
• Docket Number: 8 Div. 854
• Parties: SCHARNAGEL et al. v. FURST et al.
• Court: Alabama Supreme Court

112 So. 102

215 Ala. 528

SCHARNAGEL et al. v. FURST et al.

8 Div. 854

Supreme Court of Alabama

March 24, 1927

Appeal from Circuit Court, Franklin County; Chas. P. Almon, Judge.

Action by Frank E. Furst and another, doing business as Furst &amp Thomas, against W.C. Scharnagel and others. From a judgment for plaintiffs, defendants appeal. Transferred from Court of Appeals under Code, 1923, § 7326. Reversed and remanded.

Stell &amp Quillin, of Russellville, for appellants.

Williams & Chenault, of Russellville, for appellees.

SOMERVILLE J.

The complaint in this case exhibits the principal contract and the guaranty, and shows performance of the principal contract by the plaintiff, default in the payment of his accounts by the principal contractor, and default by the guarantors in the payment of their principal's debt according to the terms of their guaranty. These three essentials are all that needed to be shown, and the complaint was not subject to the objections urged by the demurrer. Nesbit v Bradford, 6 Ala. 746, 750; Leftkovitz v. Bank, 152 Ala. 521, 44 So. 617; 28 Corp.Jur. 1019, § 186. By the terms of the contract, notice of the default was waived, and the guaranty became absolute three months after the termination of the principal contract, and the guarantors were bound by their principal's written acknowledgment of his account--all of which is shown by the amended complaint. The defaulted obligation of the principal was nonpayment of the balance due on his account, and it would not be necessary to set out the items of the account even in a suit against the principal.

This contract, by its terms, did not become effective until its acceptance and approval by plaintiffs at their office in Freeport, Ill. The fact that it was deposited in the mail at Spruce Pine, Ala., on Sunday, for transmission to plaintiffs at Freeport, did not make it a Sunday contract, and the pleas of invalidity, based on that allegation were properly held bad on demurrer. The identical question, in relation to a contract like this, was decided in J.R. Watkins Co. v. Hill et al., 214 Ala. 507, 108 So. 244. Demurrers were properly sustained to pleas 8 and 9, but not to plea 7, averring merely that the contract was void because made on Sunday. However, of plea 7 defendants had the benefit under the plea of the general issue.

Some of the more important questions here presented were decided by this court in the very recent case of Furst & Thomas v. Shows et al., 110 So. 299, which was an action on a principal and guaranty contract identical with the one here shown, wherein, as here, it was urged in defense that some of the items sold to the principal were bottles of lemon and orange extract containing 85 per cent. of alcohol, and intended, within the knowledge of the plaintiffs, to be sold and used as a beverage.

It was there held that the sale of goods to the principal was interstate commerce; that lemon and orange extracts containing 85 per cent. of alcohol are legitimate articles of merchandise under federal laws; (but) that their local sale for beverage purposes would violate both state and federal laws; that the validity of the principal and guaranty contract was not affected by the illegality of the sales of those two items: and that, though their principal illegally sold these extracts as alcoholic beverages, this was no defense for the guarantors, unless the plaintiff knew or had notice that they were to be resold for that purpose at the time they made the original sale--as to which knowledge or notice the burden of proof was on the defendants.

Being articles of interstate commerce, those pleas were insufficient which alleged that the extracts were intoxicating bitters or beverages, and were sold in violation merely of state laws. They were defective also in not alleging that plaintiffs sold them as beverages, or with knowledge that they were to be so used. However, that defense was amply presented by several special pleas upon which the case was submitted, and the elimination of some of them on demurrer was not prejudicial, even if erroneous.

The rule undoubtedly is that anything that renders the obligation absolutely void and unenforceable against the principal is available to the guarantors also, in avoidance of their liability on the guaranty, even though their principal is not made a party defendant, and has not asserted the invalidity of his obligation. On the other hand, where the matter of defense shows that the contract is voidable only at the election of the principal, it is not available to his guarantors or sureties, unless it has been asserted by the principal himself. Evans v. Keeland, 9 Ala. 42, 46 47; ...