Opinion
(January Term, 1868.)
A creditor having, in March, 1863, refused to accept Confederate or State notes in payment of debts contracted before the late war, the debtor brought to him a bond upon a third party for the amount due, payable to the creditor, who agreed to take it in discharge of the debt, provided the debtor would sign it as surety. He did so and the former evidences of indebtedness were canceled: Held, that the debtor became a guarantor of the bond and was liable in assumpsit for the full amount, without reference to the laws providing for a scale of debts contracted during the war.
( Carpenter v. Wall, 4 D. B., 144, and Green v. Thornton, 4 Jon., 230, cited and approved.)
ASSUMPSIT, tried before Mitchell, J., at Fall Term, 1867, of the Superior Court of ROCKINGHAM, upon the following case agreed:
Merrimon for appellant.
Phillips Battle, contra.
The defendant's intestate, in the years 1856 and 1857 became indebted to the plaintiff for borrowed money and executed bonds therefore at the dates of the loans. The principal and interest amounted on 14 March, 1863, to $3,000. On that day Scales offered to pay off his bonds in Confederate notes or State money, and the plaintiff refused to accept them. Thereupon Scales procured the bond of the county of Rockingham for $3,000, payable to the plaintiff, but upon what consideration the plaintiff was ignorant. Scales tendered it to the plaintiff in payment of his bonds, and he refused to accept it unless Scales would become surety for the county. Scales signed as surety at the foot of the bond, and thereupon the bonds given for the borrowed money were surrendered.
The plaintiff contended that the defendant was liable for $3,000, with interest from 14 March, 1863. The defendant insisted that he was entitled to the benefit of the scale of depreciation under the act (432) of Assembly of 1866, ch. 39. It was agreed that if the court should be of opinion with the defendant, judgment should be entered for $750 and interest; but if with the plaintiff, for $3,000 and interest.
Upon the case agreed his Honor gave judgment for $3,000, with interest from 14 March, 1863, and the defendant appealed.
The judgment rendered by his Honor in the court below upon the case agreed is undoubtedly correct. The argument of the defendant's counsel to the contrary is based upon the fallacious idea that the intestate of the defendant was bound as the surety of the county of Rockingham, in the ordinary sense in which the word surety is used in connection with a principal. But in legal effect he was not a surety, but a guarantor. A guaranty is defined to be "a promise to answer for the payment of some debt, or the performance of some duty, in case of the failure of another person, who is himself liable in the first instance to such payment or performance." Carpenter v. Wall, 4 Dev. Bat., 144; Fell on Guar.; 1 Smith Mer. Law, 277. The present case comes directly within that definition. The county of Rockingham became bound to pay the plaintiff, as soon as its bond was delivered to him, the sum of three thousand dollars, and the defendant's intestate promised in consideration of the transaction between him and the plaintiff, to pay the debt in case of the failure of the obligor to do so.
The transaction between the parties to the guaranty required a consideration for its support. Here there was a consideration, which was the discharge of debts due from the intestate to the plaintiff, which were admitted to have been of the value in specie of three thousand dollars. To such a claim it is manifest from its express (433) words that the act of 1866, ch. 38, entitled "An act relating to debts contracted during the late war," did not intend to apply the scale of depreciation provided for in chapter 39 of the laws passed at the same session.
In opposition to this view of the case, it was urged by the defendant's counsel that the intestate signed the county bond professedly as surety, and not as guarantor, and that, therefore, he cannot be bound as guarantor. The case of Green v. Thornton, 4 Jon., 230, is directly in point against this objection. In that case the defendant, whose name was signed to an instrument purporting to be an indenture between the plaintiff and another person, was held to be a guarantor, though the word "security" was added to his name. It is true that the plaintiff failed to recover against him, because he could not prove any consideration for the contract of guaranty; but, in the present case an ample consideration was proved, and the plaintiff is not prohibited by the act of 1866, above referred to, from recovering to the extent of it. The judgment is affirmed.
PER CURIAM. Judgment affirmed.
Cited: James v. Long, 68 N.C. 219; Bryan v. Harrison, 71 N.C. 480; Trust Co. v. Godwin, 190 N.C. 519.
(434)