W.T. Rawleigh Co. v. Washburn
| Citation | 260 P. 1039,80 Mont. 308 |
| Decision Date | 25 October 1927 |
| Docket Number | 6153. |
| Parties | W. T. RAWLEIGH CO. v. WASHBURN et al. |
| Court | Montana Supreme Court |
Rehearing Denied Nov. 25, 1927.
Appeal from District Court, Fergus County; Wm. L. Ford, Judge.
Action by the W. T. Rawleigh Company against Douglas Washburn and others, wherein default judgment was rendered against defendant Washburn. From a judgment in favor of the remaining defendants, plaintiff appeals. Reversed and remanded, with directions.
Cheadle & Cheadle, of Lewistown, for appellant.
Belden & De Kalb, Merle C. Groene, and C. W. Buntin, all of Lewistown, for respondents.
In this case judgment by default was entered against the defendant Washburn for the full amount demanded by the plaintiff because of his failure to appear in the action. Upon issue joined the cause was brought on for trial before the court against the other defendants, a jury having been expressly waived. The action is predicated upon the written contract of the defendant Washburn with the plaintiff, and a guaranty in writing attached thereto, executed by the other defendants. By the allegations of its complaint the plaintiff seeks to hold the defendants, other than Washburn, responsible for the payment of the full amount due it from the defendant Washburn, by reason of the fact that the payment of Washburn's existing indebtedness at the time of the execution of his contract with it amounting to the sum of $2,188.71, was extended until December 31, 1922, in consideration of the execution of the contract of guaranty. Copies of both contracts are attached as parts of the complaint. The answering defendants, respondents here defended upon the ground of failure of consideration and fraud. The court made its findings of fact and conclusions of law in favor of the defendants, upon which judgment was duly entered. The plaintiff has appealed from the judgment.
The plaintiff's several assignments of error raise but one question determinative of this appeal, viz.: Did the court err in entering judgment in favor of the answering defendants? It appears that the plaintiff is an Illinois corporation, engaged in the manufacture and sale of family remedies, flavoring extracts, and the like. Its main office is maintained at Freeport, Illinois, but it established and conducted a shipping and distributing warehouse at Minneapolis, Minnesota. For some years prior to the year 1922, the defendant Douglas Washburn was engaged in selling the plaintiff's products in Fergus county. On or about January 3, 1922, he entered into a renewal contract in writing with the plaintiff, whereby it agreed to sell and deliver to him, f. o. b. cars Minneapolis, Minnesota, or Freeport, Illinois, until December 31, 1922, under the terms of the agreement, such of its products as he might order; the defendant Washburn agreeing to pay the plaintiff the invoice price of its products by him purchased, together with any balance remaining due from him at the time of the execution of his renewal contract. Provision is made that the contract shall terminate by limitation on December 31, 1922, and that the full amount due thereunder shall thereupon become promptly due, unless another renewal contract be entered into.
The plaintiff required the defendant Washburn to have the contract of guaranty executed by acceptable guarantors as a condition precedent to entering into the renewal contract with him. The defendants Martin Cook, Frank Gallas, and Rufus C. Smith, all residents of Fergus county, at Washburn's request signed the contract of guaranty, attached to Washburn's contract with the plaintiff, and accepted by the plaintiff on the date of the execution by it of the contract with Washburn. The consideration specifically mentioned in the contract of guaranty is the sum of $1 "the receipt of which is hereby expressly confessed and acknowledged, or in consideration of the above-named seller [the plaintiff] extending further credit to the said buyer [Washburn]." By the terms of the guaranty the respondents jointly and severally guaranteed to the plaintiff, "unconditionally, the payment in full of the balance due or owing said seller [the plaintiff] on account, as shown by its books at the date of the acceptance of this contract of guaranty by the seller, and the full and complete payment of all moneys due or owing, or that may become due or owing, said seller." And further it is provided therein:
Immediately following these words in capital letters, a space for signatures is provided, where the respondents signed the contract. Defendant Smith says he could read those words without his glasses. The defendant Gallas testified that he is very hard of hearing and cannot read English, and that he signed the contract of guaranty in reliance upon Washburn's representation that it consisted merely of "an accommodation of the Rawleigh medicine." The defendant Smith says that he had been acquainted with Washburn for about 30 years, and that the latter, on producing the contract, said, "Rufus, I have a paper I would like to have you sign." He testified:
Mr. Washburn then stated to him, "That's a recommendation for the company's goods here," and that it did not amount to anything. Thereupon he signed the agreement, placing reliance on Washburn's statements. Further, he explained that the year before he had signed another contract at Washburn's request, as to which he stated:
"I signed the other contract while I was in my field and did not have my glasses, and I couldn't make out what it was; so I signed it, as Washburn told me it was a recommendation of these goods."
At the date of the acceptance of the contract of guaranty by the plaintiff and the execution of its agreement with Washburn, January 3, 1922, there was due from Washburn to the plaintiff the sum of $2,188.71. Subsequently Washburn did not order and the plaintiff did not sell or deliver any of its merchandise to him; however, he paid the sum of $66.50 on his indebtedness, and at the time of the expiration of his contract he was owing a balance of $2,122.21, which amount the plaintiff seeks to recover in this action.
In accordance with the evidence on the subject, ...
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