Rehearing
Denied Jan. 13, 1913.
Appeal
from Circuit Court, Marion County; C. P. Almon, Judge.
Action
by the W. T. Rawleigh Medical Company against Emit I. Wilson
and others for breach of contract. From a judgment for
defendants, plaintiff appeals. Affirmed.
Count 4
is as follows:
"The
plaintiff further claims of defendant Emit I. Wilson, as
principal, and Ollie E. Harris, Aaron M. Sullens, and
George M. Burleson, as sureties, the said sum of $447.09 as
damages under the terms of the following contract entered
into by the plaintiff and the defendants hereto, which said
contract is in the following language, to wit:
"
'Contract: Whereas, E. I. Wilson of Chalk Bluff
Alabama, desires to purchase of the W. T. Rawleigh
Medical Company of Freeport, Illinois, on credit and at
wholesale prices to sell again to consumers, medicines
extracts, spices, soaps, toilet articles, perfumes, stock
and poultry preparations, and other goods manufactured
and put up by it, paying his account for such goods in
installments as hereinafter provided: Therefore, he
hereby agrees to sell no other goods than those sold him
by said company, to sell all such goods at regular retail
prices to be indicated by it, and to have no other
business or employment. He further agrees to pay said
company for all goods purchased under this contract the
current wholesale prices of such goods by remitting in
cash each week to said company an amount equal to at
least one-half the receipts from his business until his
account is balanced, and for that purpose as evidence of
good faith he shall submit to said company weekly reports
of his business; provided, however, if he pays his
account in full on or before the 10th day of each month
he is to be allowed a discount of three per cent. (3%)
from current wholesale prices. Upon termination of this
contract from any cause or by either party, he further
agrees to settle in cash within a reasonable time the
balance due said company on account. Unless prevented by
strikes, fires, accidents, or causes beyond its control
said company agrees to fill and deliver on board cars at
place of shipment, his reasonable orders, provided his
account is in satisfactory condition, and to charge all
goods shipped him under this contract to his account at
current wholesale prices; also to notify him promptly of
any change in wholesale or retail prices. Said company
further agrees to furnish him free of charge on board
cars at place of shipment, a reasonable amount of
first-class advertising matter, report and order blanks,
and printed return envelopes for his use in conducting
his business; also to give him, free of charge, after he
has begun work, instructions and advice, through letters,
bulletins, and booklets, as to the best methods of
selling its products to consumers. This contract is
subject to acceptance at the home office of the company
and is to continue in force only so long as his account
and the amount of his purchases are satisfactory to said
company; provided, however, that said E. I. Wilson or his
guarantors may be released from this contract at any time
by paying in cash the balance due said company on
account. Dated at Freeport, Illinois, September 28, 1909.
"
'[Signed]
"
'The W. T. Rawleigh Medical Company,
"
'By W. T. Rawleigh, President.
"
'Emit I. Wilson.
"
'In consideration of the W. T. Rawleigh Medical Company
extending credit to the above-named person we hereby
guarantee to it, jointly and severally, the honest and
faithful performance of the said contract by him, waiving
acceptance and all notice and agree that any extention of
time or change of territory shall not release from
liability herein.
Names.
Occupations. P. O. Addresses.
Ollie
E. Harris Farming Fernando, Ala.
Aaron
M. Sullens Farming Chalk Bluff, Ala.
George
M. Burleson Farming Bear Creek, Ala.,
R. F.
D. No. 1.
"
'The above guarantors are entitled upon request at any
time to a statement of salesman's account.'
"And
plaintiff further alleges that, under the terms and
conditions of said contract, it sold the said defendant Emit
I. Wilson medicines, extracts, spices, soaps, toilet
articles, perfumes, stock and poultry preparations, and other
goods manufactured and put up by it from the time of the
execution of said contract up to the 21st day of October,
1910, to the amount of $692.15, and that there yet remains a
balance due on account in the said sum of $447.09, together
with the interest thereon from said 21st day of October,
1910, and that said sum is still due and unpaid. And
plaintiff further alleges that, although it has complied with
the terms and conditions of said contract on its part, the
said defendant Emit I. Wilson wholly failed to comply with
the terms of said contract on his part in this: That he
failed to remit in cash each week to the plaintiff an amount
equal to at least one-half the receipts from his business
until his account was balanced, but that the same now remains
unbalanced with an indebtedness due from said Emit I. Wilson
to the plaintiff in the sum of $447.09, with the interest
thereon, for which he and the other defendants herein are
severally and jointly liable, hence this suit."
The
defendant Sullens filed the following pleas:
"(1)
The defendant A. M. Sullens, for answer to the complaint
filed in this case, says that at the time of the execution of
the contract sued on in this case one E. I. Wilson, who is
the principal obligor in said bond or contract, represented
to defendant that he was signing a recommendation of the said
Wilson to the plaintiff company, which representation was
false and fraudulent, and by means of such representation
this defendant was deceived and induced to execute the
contract.
"(2)
The defendant says that he signed the name to said contract
or bond sued on with the distinct agreement between him and
the said E. I. Wilson, who was the principal obligor, that
the said bond or contract should not be delivered to the
plaintiff until signed by J. J. Lolley, and the defendant
says that the said E. I. Wilson delivered said bond or
contract without getting the said J. J. Lolley to sign it.
Wherefore, defendant is not bound thereby."
The
demurrers filed to plea 1 are as follows: "It is no
answer to the complaint; does not allege that E. I. Wilson
was the agent of plaintiff, and authorized to bind it in the
premises. For aught that appears, plaintiff is not bound by
any statement or recommendation made or alleged to have been
made by the said E. I. Wilson." To the second plea the
same demurrers as to the first plea, with these additional
grounds: "It is not alleged that plaintiff had any
notice or knowledge of the conditions set forth in said plea,
and for aught that appears plaintiff had no notice or
knowledge of any agreement so alleged to have been made by
the said Wilson. It is not shown that Wilson was authorized
to bind the plaintiff by said agreement. It is not shown that
Wilson was the agent of plaintiff, and that defendant had the
right to rely upon any agreement so made or alleged to have
been made. It is not shown that there was a fraudulent
collusion between the plaintiff and the principal obligor,
Wilson, to charge the defendant."
THOMAS
J.
The
reporter will set out count No. 4 of the complaint, which
fully states plaintiff's case; also pleas No. 1 and No. 2
of defendant A. M. Sullens, together with the demurrers to
said two pleas. The overruling of these demurrers by the
trial court, and an overruling by it of like demurrers to
like pleas filed by the other defendants O. E. Harris and
Geo. M. Burleson, which are not necessary to be set out,
raises the question as to the only errors here assigned.
It will
be observed that in the pleading as set out both
sides--plaintiff and defendants--treated the defendants
Sullens, Harris, and Burleson as sureties for the defendant
Wilson on the contract set out in said count No. 4 of the
complaint; whereas, they were only guarantors as decided by
this court on a construction of a like contract in the case
of W. T. Rawleigh Medical Co.
v. Tarpley et al., 59 So. 512. However, so far as the
principles of law involved on this appeal are concerned, we
discover no substantial difference between sureties and
guarantors, and will treat the case--as the respective
parties to the litigation and their counsel have done
all through the proceedings, including briefs filed here--on
the theory that said named defendants are sureties for the
defendant Wilson on said contract.
We
shall deal first with the sufficiency of the second plea as a
defense, tested by the demurrers. In Smith v
Kirkland, 81 Ala. 350, 1 So. 277, Judge Somerville,
speaking for our Supreme Court on the same question
differently raised, says: "It has been long settled in
this state by a line of decisions which seem to be supported
by the weight of authority that it is a good defense to an
action on a bond that a defendant, who is a surety, intrusted
the bond to the principal obligor as an escrow, with
authority to deliver it only on the express condition that
other named persons should join as sureties in its execution
prior to such delivery, and that the instrument was delivered
to the obligee in violation of this condition. Guild v.
Thomas, 54 Ala. 414 , and authorities
cited there; Bibb v. Reid, 3 Ala. 88. There are two
established modifications of this rule: (1) It does not apply
to...
