W.B. Saunders Co. v. Ducker

• Court: Maryland Supreme Court
• Writing for the Court: BURKE, J.
• Citation: W.B. Saunders Co. v. Ducker, 82 A. 154, 116 Md. 474 (Md. 1911)
• Decision Date: 15 November 1911
• Parties: W. B. SAUNDERS CO. v. DUCKER.

82 A. 154

116 Md. 474

W. B. SAUNDERS CO. v. DUCKER.

Court of Appeals of Maryland

November 15, 1911

Appeal from Superior Court of Baltimore City.

Action by the W. B. Saunders Company against Harry T. Ducker. From a judgment for defendant on demurrer to the declaration plaintiff appeals. Affirmed.

Argued before BOYD, C.J., and PEARCE, BURKE, THOMAS, PATTISON URNER, and STOCKBRIDGE, JJ.

J. Kemp Bartlett, for appellant. Edward N. Rich, for appellee.

BURKE J.

The appellant, a foreign corporation, sued Harry T. Ducker, the appellee, in the superior court of Baltimore city. The defendant demurred to the declaration. The court sustained the demurrer, with leave to amend. The plaintiff declined to amend, and judgment for costs was entered on the demurrer and from this judgment the plaintiff has brought this appeal.

The suit is on a guaranty in the penalty of $2,000 dated September 26, 1899, executed by the defendant under seal and delivered to W. B. Saunders of Philadelphia, Pa. The declaration is a lengthy one, but only such portions of it will be transcribed as will be necessary to dispose of the legal question presented by the appeal. Prior to the execution of the obligation sued on, the defendant caused to be incorporated under the laws of this state a corporation known as the "Medical & Standard Book Company of Baltimore City," and he became the president of this company, and continued as its president until the institution of this suit. The business of the corporation was that of a dealer in medical, trade, subscription, and other books. W. B. Saunders was a dealer in the class of books in which the corporation dealt, and it and the defendant solicited the agency for the sale of the books published by him. The guaranty recites that it was given for the faithful performance of services on the part of the corporation, which was then about to enter into the employ of W. B. Saunders, "and to act as his agent."

The conditions of the obligation are that the corporation, "while acting as his agent, will be from time to time intrusted with books, moneys, valuable documents and other property belonging to the said W. B. Saunders, and will be called upon to fill positions of trust and responsibility: Therefore I do firmly hold and bind myself, my heirs, executors, administrators or assigns in the above named sum, to make good and truly pay to the said W. B. Saunders, in lawful money, any loss or losses that he may sustain through the neglect or failure of the said Medical & Standard Book Company to faithfully discharge the duties and obligations imposed upon it by its position. Provided, however, that in the event of the faithful performance by the said Medical & Standard Book Company of all the duties and obligations imposed upon it and upon the surrender by it to W. B. Saunders of all the books, money, documents and other property to which he may be justly entitled at such time and in such manner as he directs, then this obligation shall be void; otherwise of full force and virtue. It is also stipulated that the suretyship hereby created shall cover and apply to the whole period of such agency under whatever agreements, express, implied, altered, renewed, or extended, said agency may from time to time be conducted, as well as when said agency shall be continued by the parties under any agreement which shall have expired by time." In October, 1901, the publishing business of W. B. Saunders was conducted by him alone under the firm name and style of W. B. Saunders & Co. and the Medical & Standard Book Company, and Harry T. Ducker solicited the agency of said company for the sale of its books, the said Ducker agreeing in writing "with the said publishing house that his aforesaid certain bond and obligation should extend to and cover the dealings of the said Medical & Standard Book Company of Baltimore city with both the trade book department and the subscription book department of the said publishing house." In January, 1906, the publishing business of W. B. Saunders was incorporated under the laws of Pennsylvania by the organization of the W. B. Saunders Company, and it is alleged that "all of the assets of said publishing house, including its claim against the said Medical & Standard Book Company of Baltimore City, for the proceeds of books sold and not accounted for, and against the said Harry T. Ducker, defendant, under his aforesaid bond and obligation, were assigned, transferred, and delivered to the said corporation, the plaintiff herein, with the knowledge and assent of the said Medical & Standard Book Company of Baltimore City and the said Harry T. Ducker, defendant."

Subsequently the Medical & Standard Book Company became insolvent, and receivers were appointed to take charge of its affairs. It is alleged that in March, 1910, the defendant requested the plaintiff to consent that at a sale all of the assets of the Medical & Standard Book Company remaining unsold in the hands of receivers should be sold to Edward Slye and others, the former treasurer and general manager of the Baltimore corporation, for $5,000, and that the "said Harry T. Ducker, defendant, promised and agreed with the said W. B. Saunders Company plaintiff that if it, the said W. B. Saunders Company, would consent that such sale would be made by the receivers of the said Medical & Standard Book Company of Baltimore city, that none of the rights of the said W. B. Saunders Company, plaintiff, against the said Harry T. Ducker, defendant, under the aforesaid bond and obligation of the said Harry T. Ducker, defendant, should be in any manner impaired or the liability of the said Harry T. Ducker, defendant, to the said W. B. Saunders Company, plaintiff, under said bond and obligation in any manner affected, impaired, or released." The declaration avers that the plaintiff relied upon the said promise and agreement of the defendant, and gave its consent to the sale of the assets of the Medical & Standard Book Company to Slye and others, and that the sale was accordingly made. It is then alleged "that the said Medical & Standard Book Company of Baltimore City, while acting as agent of the plaintiff, was from time to time intrusted with books belonging to the plaintiff, but it has failed to make good and truly pay to said plaintiff the proceeds or value of said books, whereby the plaintiff has sustained, through such failure of said Medical & Standard Book Company of Baltimore City, great loss and damage, to wit, the sum sixteen hundred and sixty-three dollars and forty-nine cents ($1,663.49), with interest thereon from the 30th day of April, 1910."

It is obvious from these allegations of the declaration that the plaintiff, the Pennsylvania corporation, seeks to hold the defendant liable on the guaranty for default of the Medical & Standard Book Company while acting as its agent, and the question is whether under the facts alleged these defaults are covered by or are within the terms of the bond.

The plaintiff's case cannot be aided by the paragraph of the declaration which has been adverted to referring to the sale of the assets of the insolvent company because the defendant did not promise or agree to be answerable for the defaults which are the basis of this suit. His agreement was that the rights of the plaintiff should not be impaired or the liability of the defendant affected by the sale. This is quite a different thing from a binding obligation to pay the debt due by the insolvent corporation to the plaintiff.

"A contract of guaranty or suretyship is said to be strictissimi juris, and one in which the guarantor has the right to prescribe the exact terms upon which he will enter into the obligation, and to insist on his discharge if those terms are not observed. It is not a question whether he is harmed by a deviation to which he has not assented. He may plant himself...