Wis. Marine & Fire Ins. Co. Bank v. Wilkin

• Court: Wisconsin Supreme Court
• Writing for the Court: MARSHALL
• Citation: Wis. Marine & Fire Ins. Co. Bank v. Wilkin, 95 Wis. 111, 69 N.W. 354 (Wis. 1896)
• Decision Date: 15 December 1896
• Parties: WISCONSIN MARINE & FIRE INS. CO. BANK v. WILKIN ET AL.

95 Wis. 111

69 N.W. 354

WISCONSIN MARINE & FIRE INS. CO. BANK

v.WILKIN ET AL.

Supreme Court of Wisconsin.

Dec. 15, 1896.

Appeal from circuit court, Milwaukee county; D. H. Johnson, Judge.

Action by the Wisconsin Marine & Fire Insurance Company Bank against Theodore S. Wilkin and others. From the judgment, plaintiff appeals. Reversed.

This is an action on a contract of guaranty, which is in the following words: “Whereas, the Wilkin Manufacturing Company, of Milwaukee, is indebted to the Wisconsin Marine & Fire Insurance Company Bank, of Milwaukee, Wisconsin, in the sum of about $9,000 (nine thousand dollars); and whereas, the said company may hereafter become indebted to said bank for additional amounts; now, therefore, in consideration of the premises, and of one dollar to each of us in hand paid, the receipt whereof is hereby acknowledged, we and each of us do hereby agree upon demand to pay, or cause to be paid, to said Wisconsin Marine & Fire Insurance Company Bank, all loans, drafts, overdrafts, indorsements, accounts, checks, notes, interest, demands, and liabilities, of every kind and description, now owing, or which may hereafter become due or owing, by said Wilkin Manufacturing Company to said Wisconsin Marine & Fire Insurance Company Bank. It is understood that we each waive notice of demand and notice and protest of every kind, and agree that said bank may without notice grant extensions of time to said company, and may from time to time renew any obligations of said company. This is a continuing guaranty. It is understood that we are to pay any sums which may accrue hereunder in the proportion which the amount of stock now held by each of us in said company bears in the whole amount of capital paid in by said company. In witness whereof, we have hereunto set our hands and seals, this ninth day of Jany., A. D. 1888.” The instrument was signed by all the defendants. The answer of the defendants set forth the amount of paid-up stock of each defendant in the Wilkin Manufacturing Company, and the total amount of paid-up stock of the company at the date of the execution of the contract. The respondents claimed that their liability to plaintiff was in the proportion which the amount of stock held by each, at the date of the contract, bore to the whole amount of capital paid in at that time. The trial court construed the contract in accordance with such contention, and found that defendants Moris and Wilkin were not the owners of stock at all; hence not liable on the contract. The case was tried by the court. Appropriate exceptions were filed to raise the questions considered in the opinion. Judgment was rendered in accordance with the findings, against each defendant, for such proportion of the indebtedness of the Wilkin Manufacturing Company to the plaintiff as the amount of stock of such defendant in such company bore to the whole amount of its paid-up stock at the date of the contract. Plaintiff appealed from the judgment.

Miller, Noyes, Miller & Wahl and Fish & Cary, for appellant.

Joshua Stark and Winkler, Flanders, Smith, Bottum & Vilas, for respondents.

MARSHALL, J. (after stating the facts).

This case turns on the construction of the contract of guaranty. The learned trial judge held that, by the terms of the contract, there was created a several, not a joint, liability; that each of the defendants who signed as guarantor became liable only for such portion of the indebtedness of the Wilkin Manufacturing Company as the amount of stock held by him in such company, at the date of the contract, bore to the whole amount of capital then paid in to said company. It is claimed on the part of appellant that the contract is a joint and several obligation; that each of the signers is liable to the plaintiff for the whole indebtedness of their principal; and that the last clause of the agreement, which the respondents contend limits the liability of each of the guarantors to the proportion of the debts of the manufacturing company which such guarantor's stock, at the date of the contract, bore to the total paid-up stock of the corporation, has no other effect than to furnish a rule for contribution between the several guarantors. Considerable evidence was received, under objection, respecting the transactions leading up to the signing of the contract, and numerous errors are assigned on the rulings of the court in that regard; but the view we take of the case renders it unnecessary to consider such alleged errors.

The rules that govern the judicial construction of contracts, rightly understood and properly applied, will leave no reasonable doubt respecting the legal effect of the one in question. It must be borne in mind that the office of judicial construction is not to make contracts or to reform them, but to determine what the parties contracted to do; not necessarily what they intended to agree to, but what, in a legal sense, they did agree to, as evidenced by the language they saw fit to use. If the meaning of the language is ambiguous, the construction may be aided by resort to proof of the situation of the parties, their acts, and of the subject-matter. Nilson v. Morse, 52 Wis. 240, 9 N. W. 1;Sigerson v. Cushing, 14 Wis. 527. It is said that the intention of the parties is to be sought for in the instrument itself, and that particular words and sentences must be construed so as to subserve such intention (Weiseger v. Wheeler, Id. 101; Johnson v. Insurance Co., 39 Wis. 87); but that must be taken in connection with the proviso that no intention, however manifest, can be effectuated unless it is consistent with a meaning that may reasonably be attributed to the language of the contract. So, after all, judicial construction comes down to this: What did the parties mean by the language they used? Weiseger v. Wheeler, supra; Johnson v. Insurance Co., supra; T. B. Scott Lumber Co. v. Hafner-Lothman Manuf'g Co., 91 Wis. 667, 65 N. W. 513;Jacobs v. Spalding, 71 Wis. 177, 36 N. W. 608;Braun v. Rendering Co., 92 Wis. 245, 66 N. W. 196;Gibbons v. Grinsel, 79 Wis. 365, 48 N. W. 255. Nevertheless, while what the parties themselves meant is a test, it is not the only test of what a contract is in legal effect, for there is a limit, as indicated, beyond which the courts cannot go in that regard, expressed by standard text writers, and substantially all judicial authority, in the language of Parsons on Contracts (volume 2, § 494), as follows: “Courts cannot adopt a construction of any legal instrument which shall do violence to the rules of language or the rules of law.” Parkhurst v. Smith, Willes, 332. “If we go beyond this,” says Chief Baron Eyre, in Gibson v. Minet, 1 H. Bl. 569, “we no longer construe men's deeds, but we make deeds for them.” In short, that meaning cannot be given to a contract which cannot be reasonably drawn from its language, for the purpose of carrying out the intention of the parties thereto, however clearly established. It follows from the foregoing that, if a contract is so worded that it cannot be construed so as to carry out fully the intention of the parties, a court of law is powerless to do more than to enforce it so far as possible, within the principles indicated. Stating the rule in the language of Parsons on Contracts (volume 2, p. 494): “The rules of judicial construction do not require that the court should always construe a contract to mean what the parties meant, but that it should give to the contract such construction as will bring it as near the actual meaning of the parties, as the words they saw fit to employ, when properly construed, and the rules of law, will permit.” There is another familiar rule that should be observed in the construction of this contract. That is that effect should be given, if possible, to all its parts. To that end, no part of the agreement should be rejected as void for uncertainty, or otherwise, if it will admit of any reasonable construction so as to...