| Tex. App. | Nov 24, 1910
Lead Opinion
(after stating the facts as above). Appellant insists that he was not liable on the guaranty sued on because he was induced to execute it in reliance on a representation made to him by Males that the one first maturing of the two Siebold $500 notes had been paid, when, in fact, it had not been paid. But it does not appear from anything in the record that in making the representation Males was authorized to act for, or even that he assumed to act for, appellee. Appellee’s rights under the guaranty could not, it should he needless to say, be affected by a misrepresentation made by a person who was without authority to act for him in making it.
Appellant next insists that he was not liable because of a recital in the guaranty that said note had been paid. But the recital was his own, and certainly he should not be heard to complain that it was false. Evidently the insistence is made on the theory that the representation should be treated as having been made by appellee to appellant, because the instrument contdining it was written at appellee’s instance by his attorney. We think it is plain that such a theory is not maintainable. Appellee was not willing to purchase the notes Males wished to sell to him unless the first of said two Siebold notes had been paid and the payment of the other one by Crites was guaranteed by some one acceptable to him. He was in the attitude of saying to Males: “If you will have Darnell to execute an instrument recited as a fact that the first of the two Siebold notes has been, as you assure me it has
The remaining contention is that appellant was not liable on the guaranty, because, in the negotiations resulting in the conveyance of the lot to appellee (then the holder of all the incumbrances existing on it) by Crites, the lien existing to secure the payment of the second as well as the others of said Sie-bold notes had been canceled, and Crites had been released by appellee from liability on account of his (Crites’) undertaking to pay the same. It is true as a general rule that, if the principal debtor is released by the creditor, the guarantor (is thereby also discharged. It is also true as a general rule that, if the creditor relinquishes a lien he has on property of the principal debtor to secure the debt, the guarantor is to the extent of the value of the lien relinquished discharged from liability. 1 Brandt, §§ 164, 480. But it is also true that if the guarantor consents that the principal shall be released, and that the security shall be relinquished, he will not thereby become discharged of liability on his guaranty. 1 Brandt, §§ 165, 480, and note 12. The trial court found as facts that Males acted with appellee in the negotiations resulting in the release of Crites and the ex-tinguishment of the lien of the Siebold notes on the lot, and that appellant, when requested by appellee to advise with reference to same, replied that “whatever Males did was all right.” In view of the judgment rendered, we think this finding should be construed as a finding that appellant consented to and acquiesced in the arrangement made with Crites.
"We are of the opinion that error in the judgment rendered has not been shown. Therefore it is affirmed.
Rehearing
On Motion for Rehearing.
It is insisted that the conclusion reached ty us that appellant had no right to complain because of the falsity of the recital in his guaranty of the payment by Crites of the second of the two Siebold $500 notes that the first one had been paid was erroneous and in conflict with the conclusion reached by other courts in a number of eases cited in the motion, presenting, appellant contends, a similar state of facts. Of the cases so cited GBlaney v. Rogers, 174 Mass. 277, 54 N. E. 561, seems to be most relied upon as being directly in point on its facts. There a recovery, it seems, was sought against a surety on a bond prepared by the plaintiffs’ attorneys for a breach of an undertaking on the part of the principal that certain buildings recited to be in process of construction upon certain lots “should be finished in good and workmanlike manner.” The plaintiffs at the time the bond was prepared by their attorneys and the surety at the time it executed the bond, relying upon the recital, supposed buildings were being erected upon the lots, -but as a matter of fact there were no buildings in process of construction upon same. The court held that the surety was not bound by the recital in the bond, and therefore was not liable, because the recital “was induced by a mutual mistake of fact without any (fault or negligence on the part of the” surety. It will be noted that the mistake of the parties in that case was with reference to an essential element of their contract; that is, its subject-matter, to wit, buildings they supposed to be in process of erection on the lots. It is well settled that, except in cases where the uncertainty of the existence of the thing is the essence of the agreement, a mutual mistake' of the parties as to the existence of the subject-matter of their contract will invalidate it. 20 A. & E. Ency. Law, 813; 1 Page on 'Contracts, §§ 60, 71. Here the mistake was not with reference to an essential element of .the contract of guaranty, but was with reference to a "matter collateral to it. The note appellant undertook to guarantee that Crites would pay was in existence and was a valid and subsisting charge against the lot, as the parties supposed it to be. The matter about which they w^re mistaken was as to the payment of the other $500 note — a thing collateral to the one they contracted about. It is well settled that in such a case the mistake does not invalidate the contract. “Whatever may be thought,” says Mr. Page, “of the propriety from a' moral standpoint of holding a person to a contract into which he entered under a mistake as to a collateral material fact, the law is confronted with the necessity of adopting a rule which will make it possible to enforce contracts at all. Accordingly the rule adopted by the great weight of authority is that mere mistake in the inducement is not operative, and that a contract induced by reason thereof is perfectly enforceable and valid. A mistake of this sort is an error for which the law furnishes no relief.” 1 Page on Contracts, § 155.
The motion is overruled.