Standard Supply Co v. Person

• Decision Date: 18 March 1908
• Citation: 60 S.E. 904,147 N.C. 106
• Court: North Carolina Supreme Court
• Parties: STANDARD SUPPLY CO. v. FINCH & PERSON et al.

60 S.E. 904

147 N.C. 106

STANDARD SUPPLY CO.

v.FINCH & PERSON et al.

Supreme Court of North Carolina.

March 18, 1908.

1. Guaranty—Consideration.

A mere guaranty of payment of an existing debt of another, without more, has no consideration.

[Ed. Note.—For cases in point, see Cent. Dig. vol. 25, Guaranty, §§ 14-16.]

2. Same—Extent of Guaranty.

Defendant declined to pay a bill of plaintiff against a firm, or to accept a draft therefor, stating it to be his rule to only pay after the firm had placed funds to his credit. Plaintiff then proposed that defendant accept a paper on certain terms, and he replied that he would pay their bill as soon as the firm's dry kiln got in operation. Held, that the guaranty did not include any future bills.

[Ed. Note.—For cases in point, see Cent. Dig. vol. 25, Guaranty, § 47.]

Appeal from Superior Court, New Hanover County; Biggs, Judge.

Action by the Standard Supply Company against Finch & Person and another. Judgment for plaintiff. Defendants appeal. Reversed, and new trial granted.

The evidence tended to show that plaintiff sold and delivered to Finch & Person, a partnership composed of S. II. Finch and W. R. Person, goods and material on account from February 2, 1906, to June 14th of same year, to the amount, with accrued interest, of $611.-45; that $159.70 of this account inclusive of interest, became due on May 10, 1906, and the remainder, to wit, $451.75, accrued after that date. Other evidence was introduced which plaintiff insisted established the liability of J. E. Person for the debt as guarantor of payment. The action was brought against Finch & Person, to whom the goods were sold, and also against J. E. Person, as guarantor of payment. Two issues were submitted for the consideration of the jury: (1) Are defendants Finch & Person indebted to plaintiff, and, if so, in what amount? (2) Is defendant J. E. Person liable for such indebtedness, and, if so, what part thereof? The court charged the jury that, if they believed the evidence, they would answer the first issue: "Yes, in the sum of $611.46, with interest on $600.94 from September 1, 1906." And the second issue: "Yes, in the sum of $461.-75, with interest on same from May 10, 1906." Verdict and judgment for plaintiff, and defendants excepted and appealed.

Rountree & Carr, for appellant.

Person. Meares & Ruark, for appellee.

HOKE, J. (after stating the facts as above). The court does not take the view of this evidence which seems to have impressed the trial judge. The account for these goods being originally an obligation of Finch & Person, and for which that firm still remains liable, any obligation of defendant J. E. Person, as guarantor, must be evidenced and established by written agreement, or some written note or memorandum of same, signed by him, or some person duly authorized to sign for him. Revisal 1905, § 974; Jenkins v. Holley, 140 N. C. 379, 53 S. E. 237, 111 Am. St. Rep. 890; Sheppard v. Newton, 139 N. C. 533, 52 S. E. 143. The plaintiff recognizes this as the law governing the case, and claims to have met this requirement by reason of certain written correspondence put in evidence, as follows:

"Pikeville, N. C, May 3, 1906. Standard Supply Company, Wilmington, N. C.—Gentlemen: Yours of May 1st to hand. I pay out the money Finch & Person have in my hands as they direct. That is, all their drafts and checks are sent to the bank at Fremont and placed to my credit, and from that amount I pay out as they direct. So, if they draw a draft on me, and do not have money enough to their credit to pay it, I do not pay until they do have. This is an arrangement of recent date. I have up to recently been paying their bills regardless of whether they had anything to their credit or not. I find that in order to make them more strict with their business that the responsibility of it must rest on their own shoulders from now on. With this explanation I trust my refusal to accept draft will be satisfactory to you. Respectfully, etc., J. E. Person."

"May 4, 1906. Dr. J. E. Person, Pikeville, N. C.—Dear Sir: Our extension of credit to Finch & Person has been on the basis of a letter received from you in which you stated that you were supporting this firm with your finances. We have depended entirely upon your responsibility in making accounts with them, knowing that you are perfectly responsible for any amounts which they would probably make in their joint interest. We shall have to ask of you to reconsider your determination not to accept a paper from these parties, as we know nothing of their responsibility and should not have...