130 Iowa 736 | Iowa | 1906
At the time of the execution of the contract of guaranty in question, plaintiff was a corporation doing business at Bridgeport, Conn., and the defendant Cutlery Works a corporation doing business at Cedar Rapids, this state. The other defendants named were officers of the latter corporation and engaged in the conduct of its business. Prior to July 8, 1902, materials had been purchased of plaintiff by the defendant company which had been only partially paid for. It does not appear upon what terms the credit had been extended. On the date named a further order was sent forward, calling for numerous items and with the request that certain of such items be given preference in shipment. Upon receipt of this order, plaintiff responded by making demand for security. The precise form of the demand does not appear from the record before us. To this the defendant company replied of date July 21st, saying: “ We are somewhat at a loss to know just what you want as to guarantee. As president and general manager, and as secretary and treasurer, we can give our individual assurances that the bills will be paid, at thirty days, as required, and inclose such a guarantee herewith.” The inclosure was in words as follows: “July 21, 1902. We, the undersigned, president and general manager, and secretary and treasurer, for the Iowa Cutlery Works and for ourselves individually,
Following the acceptance of the instrument of guaranty, the order for goods of date July 8th, as subsequently increased, was filled, and this was followed by several further orders, and shipments were made in compliance therewith. In April, 1903, the defendant company became insolvent, and its affairs passed into the hands of a receiver. In the meantime payments had been made to plaintiff on account sufficient to satisfy the amount due on July 8, 1902, and to reduce the amount of the order of that date to $103.88. Nothing was paid on the subsequent bills, which
Having these rules in mind, we may go to the record for the fact situation; and, as the evidence material to be considered is practically without dispute, we shall not feel ourselves bound to accept of the conclusions reached by the trial court. To begin with, it is evident that plaintiff was doubtful at least of the financial standing of the defendant company, and further credit was made conditioned on a guarantee of payment. Defendants Brewer and Hubbard were officers of the defendant company and engaged in the conduct of its business — a going concern —■ and presumably anxious for a prosperous continuance thereof. The character of the materials required to be purchased (castings in the rough for the manufacture of cutlery goods, as we understand), in the production of which plaintiff was specially engaged, were unusual in a sense, and not to be obtained on the open market. The defendant company was already indebted to the plaintiff, and an extension of credit was necessary to the procurement of further materials, and to enable the company to continue its business. In this situation, the order of July 8th was sent in, and met by the demand for security. The instrument of date July 21st was an attempt at compliance with such demand. It is to be noted that by the language thereof the parties signing “ do hereby agree . . . and guarantee that the bills for work done and material furnished . . . will be paid promptly when the same come due,” etc. The reference is to bills as they come due, and not to a bill as it comes due. It will be observed, also, that the agreement is not limited as to time or amount. It is true that such instrument was not signed by Hubbard, but it appears that he
Counsel for appellees, to rebut this conclusion and in contending for a limited guaranty, argue with much zeal that the plural form of words used in the instrument of July 28th should be accepted as having reference only to the installment shipments and invoices made under the order of July 8th as increased. And- such was the basis upon which the trial court planted its judgment. Considered apart from the other circumstances of the case, the argument is not without force. But in its last analysis the question, as we have seen, is one of intention, and this requires us to consider the course of dealing between the parties; the rejected instrument, and the letter accompanying it, as well as the ac
From what has been said, it follows that the judgment in favor of defendant Brown must be, and it is, affirmed. As to defendants Brewer and Hubbard, the judgment in favor of plaintiff is reversed, and the cause is remanded for further proceedings in harmony with this opinion. — Affirmed in part. Reversed in part.