Singer Manuf'g Co. v. Forsythe

• Decision Date: 23 November 1886
• Citation: 108 Ind. 334,9 N.E. 372
• Parties: Singer Manuf'g Co. v. Forsythe and others.
• Court: Indiana Supreme Court

108 Ind. 334

9 N.E. 372

Singer Manuf'g Co.

v.Forsythe and others.

Supreme Court of Indiana.

November 23, 1886.

Appeal from circuit court, Decatur county.

L. Maxwell and D. Wilson, for appellant.

The questions of law presented by the record are (1) whether, construing the bond and the contemporaneous agency agreement together, the former, which in terms covers every indebtedness or liability now existing, or which may hereafter in any manner exist or be incurred, must nevertheless, as matter of law, be confined to indebtedness accruing under the agency agreement; (2) if not, whether parol evidence can be received to show that such was the understanding and agreement of the parties; (3) if the second proposition is sustained, whether there is competent proof of any such parol agreement in this case.

Reading the two papers together, the result is simply that the company appoints Forsythe its agent, and, for the present agrees to furnish him with machines on consignment; taking a bond, however, to secure not merely his fidelity in that relation, but any and every indebtedness which might thereafter in any manner exist or be incurred. The admission of parol evidence to show that it was agreed that the bond should cover only obligations arising under the agency contract was in violation of elementary principles. Singer Manuf'g Co. v. Hester, 2 McCrary, 417; S. C. 6 Fed. Rep. 804; Domestic S. M. Co. v. Webster, 47 Iowa, 357. But parol evidence, if admissible at all to vary the terms of the bond, must surely be of a character to show a real agreement between the parties; and, if the agreement was made on either side by an agent, his authority to act in that behalf must be shown by the defendants, for on them rests the burden of proof, if they seek to vary the terms of the bond. There is no satisfactory evidence of any such agreement.Miller & Gavin and J. S. Scobey, for appellees.

Mitchell, J.

The complaint in this case charges that on the twenty-seventh day of October, 1874, William H. Forsythe, Columbus C. Burns, and Elias R. Forsythe executed a joint and several bond to the Singer Manufacturing Company, conditioned that William H. Forsythe should pay, or cause to be paid, any and every indebtedness or liability then existing, or which might thereafter in any manner exist or be incurred, on the part of William H. Forsythe, to the Singer Manufacturing Company, whether such liability should exist in the shape of book-accounts, notes, renewals, or extensions of notes, or accounts, acceptances, indorsements, or otherwise. A copy of the bond was filed with, and made part of, the complaint. The conditions of the bond are substantially as they are recited in the complaint. It was averred that thereafter, in the year 1877, on the faith of the bond, and in pursuance of its provisions, William H. Forsythe, for a valuable consideration, executed his four promissory notes, for amounts stated, to the Singer Manufacturing Company. Copies of the notes are set out. They are all payable at a bank in this state. The complaint also charges that, pursuant to the above-mentioned bond, William H. Forsythe transferred and delivered to the obligee in the bond a certain note, against one James H. Kersey, and that he (Forsythe) guarantied the payment of the same to the plaintiff. It avers that the note so transferred and guarantied is not collectible. It is alleged that all the notes are due and unpaid. Judgment is demanded as for a breach of the condition of the bond.

Neither the complaint, nor the bond, on its face, discloses, unless by implication, any consideration whatever, for the execution of the obligation sued on. It does not appear, either by averment in the complaint, or recital in the bond, that William H. Forsythe was indebted to the Singer Manufacturing Company at the time the bond was executed, or that there was any business transaction of any kind had, or under contemplation, between him and the company at the time the bond was delivered. So far nothing appears except that in 1874 the obligors signed and delivered the bond in suit to the Singer Manufacturing Company, and that three years thereafter the notes described in the complaint were received on the faith of the bond, for a valuable consideration moving to the maker and guarantor of the notes. No question is made as to the sufficiency of the complaint, and we express no opinion on that subject.

Answers were filed in which substantially the following facts are made to appear, viz.: That the sole and only consideration for the execution of the bond declared on was that, concurrently with its execution, the Singer Manufacturing Company, by a written agreement, constituted William H. Forsythe its agent for the sale of its sewing-machines in the county of Decatur, in the state of Indiana; the company agreeing to furnish him for sale, and to be leased, machines and accessories, at a discount of 35 per cent. from its regular list price. The contract stipulated that the agent should account monthly for all machines sold or leased by him, either with cash, or the note of the purchaser, or by giving his own promissory note, and, at the termination of the agency, return to the company all machines remaining unsold. The answer alleges that this contract of agency continued until the fifteenth day of May, 1875, when it was superseded by a new contract, and that this new contract was superseded by a third, on the third day of October, 1876, which was followed by a fourth, dated May 13, 1877; that finally, on the fourth day of October, 1877, the agency was terminated, and a full and final settlement had between the company and its agent. This settlement, according to the answer, resulted in an absolute sale by the company to William H. Forsythe of all the machines then unsold in the possession of the latter, and which had been consigned to him under the previous contracts of agency. The answer further avers that all of the foregoing contracts, except that executed contemporaneously with the bond in suit, were made without the knowledge or consent of the defendant, and that the notes sued on were executed in consideration of, and in payment for, the property purchased by William H. Forsythe from the company on the fourth day of October, 1877, when the previous contracts were annulled and canceled. There were also answers alleging that the bond had been executed without consideration.

Demurrers were overruled to all the answers which presented as a defense the facts above set out. Upon issues made, a trial was had, which resulted in a finding and judgment for the defendants below.

It is contended here that the demurrers to the answers above summarized should have been sustained, and that the court should have granted a new trial, because the finding was not sustained by any competent evidence. The position which the appellant's learned counsel seeks to maintain is that since the bond, in terms, covers every indebtedness of William H. Forsythe, whether existing at the time the bond was executed, or which might thereafter exist, or be in any manner incurred, it was not competent to aver, and prove by parol, that the sole...