Western Const. Co., Inc. v. Austin, 27828.

• Decision Date: 01 March 1940
• Docket Number: 27828.
• Citation: 99 P.2d 932,3 Wn.2d 58
• Parties: WESTERN CONST. CO., Inc., v. AUSTIN et al.
• Court: Washington Supreme Court

99 P.2d 932

3 Wn.2d 58

WESTERN CONST. CO., Inc., v. AUSTIN et al.

No. 27828.

Supreme Court of Washington

March 1, 1940

Department 2.

Action by the Western Construction Company, Inc., against Robert L Austin and another, copartners doing business as Austin Plumbing & Heating Company, Abe Sherman, doing business as Sherman Plumbing p Heating Company, and another, to recover an amount due plaintiff from defendant partners, whose payment thereof defendant Sherman guaranteed. From a judgment for plaintiff against defendant Sherman, he appeals.

Reversed.

Appeal from Superior Court, King County; Chester A. Batchelor Judge.

Charles F. Riddell and William C. Taylor, both of Seattle, for appellant.

Ralph B. Potts, of Seattle, for respondents.

BLAKE Chief Justice.

This is an action on a contract of guaranty. November 12, 1937 plaintiff entered into a contract with the United States government for the construction of a post office building at Snohomish. On November 26, plaintiff and Robert L. Austin entered into a contract whereby the latter agreed for a consideration of $6,330, to 'furnish all material and perform all labor for the plumbing and heating and sewer work.' On March 14, 1938, Austin assigned 'all moneys due and to become due for the performance of said contract' to the National Bank of Commerce of Seattle for the account of A. Sherman. The latter was engaged in the business of selling plumbing supplies under the trade name of Sherman Plumbing Supply Company. On February 11, 1938, he made an agreement with plaintiff as follows: (Exhibit 2)

'Agreement

'This Agreement made this eleventh day of February, Nineteen Hundred and Thirty-Eight, by and between Sherman Plumbing Supply Co. and/or A. Sherman and Western Construction Co. Inc.

'In Consideration of the Western Construction Co. Inc., acknowledging an assignment of the money due or to become due Austin Plumbing and Heating Company on the contract for the plumbing and heating for the Snohomish, Washington postoffice, to the National Bank of Commerce of Seattle, Washington, the Sherman Plumbing Supply Company guarantees that all bills for labor and material will be paid under the terms of the contract.

'Dated at Seattle, Washington, this 11th day of February, 1938.

'[signed] A. Sherman

'A. Sherman

'Sherman Plumbing Supply Company

'By [signed] A. Sherman

'Western Construction Co. Inc.

'By J. A. Johnson'

Plaintiff thereafter paid all monies which became due to Austin to the National Bank of Commerce for the use of Sherman until there was a balance due under Austin's contract of only $1,159.50. At the time this balance was due, it developed that Austin owed some $2,600 on account of heating and plumbing supplies that had gone into the job.

Upon Sherman's refusal to pay Austin's bills, plaintiff brought this action and recovered a judgment against him in the sum of $1,495.92. Sherman appeals.

Appellant urges that respondent's action must fail because no substantial damages were proved. Respondent's case was presented on the theory that it was only necessary to prove that Austin had incurred obligations for materials going into the job, the reasonable value thereof and failure to pay therefor. There was no proof whatsoever that respondent had incurred any individual liability to Austin's creditors. Nor was there proof of any steps taken by Austin's creditors to establish liability against respondent's bond furnished pursuant to Title 40, section 270, U.S.C.A. In other words, respondent failed to prove that either it or its bond was in any legal sense liable for Austin's obligations.

As we view the record, the recovery had by respondent was in the nature of a decree of specific performance, because the amount of the recovery was based solely upon Austin's obligations which Sherman had guaranteed but failed to pay. Such, however, is not the nature of an action for breach of a contract of guaranty. 1 Brandt, Suretyship and Guaranty, 3d Ed., § 142. The nature of the action is essentially one for damages for breach of contract. Noyes v. Adams, 76 Wash. 412, 136 P. 696; Meyer v. Hornby, 101 U.S 728, 25 L.Ed. 1078. The amount of the guarantor's liability is to be determined by the contract of guaranty. And that is to be construed in accordance with general rules of construction. 28 C.J. 963. In final analysis, that simply means...