17 Utah 43 | Utah | 1898
Lead Opinion
This action was originally brought to recover upon a written guaranty made by the defendants to the Deseret National Bank of Salt Lake City of which the following is a copy:
“Salt Lake City, Utah, March 17, 1892.
“For value received, we or either of us promise to pay to the Deseret National Bank of Salt Lake City any and all sums of money which the said bank may loan or advance to the Burton-Gardner Company upon notes, or on their accounts, to the amount of $25,000, and with inter
“W. S. BurtoN. Elias Morris.
“L. G. Hardy. W. 0. BurtoN.
“E. M. Weller. O. H. Hardy.
“HENRY DlNWOODEY.”
Three amended complaints were afterwards filed, based upon the express writing of the written guaranty set out in the original complaint. Demurrers thereto were sustained, and the fourth amended complaint, upon which the trial was had, was filed August 31, 1895. The theory -upon which the original and three amended complaints were based, was that the written guaranty covered past, as well as future, indebtedness of the Burton-Gardner Company. In this fourth amended complaint the plaintiff seeks to reform the written guaranty, above set out, so as to make it cover past indebtedness, represented by two notes of the Burton-Gardner Company, for $20,000, which were indorsed by all the defendants, except the appellant, Dinwoodey, as well as future loans and advances thereafter made by the bank to the Burton-Gardner Company. This reformation is asked for on the ground of mutual mistake on the part of the plaintiff and defendants, and each of them, as guarantors of the paper. The trial' court reformed the written guaranty as prayed for in the complaint, and rendered judgment against the defendants for prior indebtedness, as shown by the two notes of $10,000 •each, which had been renewed by making new notes of the Burton-Gardner Company for advances made after the guaranty was executed. From this judgment the defendants appeal to this court.
The defendants filed their answer, in which they denied •all the material allegations of the complaint, except the
It is contended by respondent that, at the time of the execution of the written guaranty by appellant, viz.: March 17, 1892, the Burton-Gardner Company was indebted to respondent in the sum of $20,000, upon two certain promissory notes, not yet due; and, desiring to borrow more money from respondent, the appellant executed the guaranty in suit to secure the payment of such back indebtedness, as well as all future advances to be made to said Burton-Gardner Company, not, however, to exceed $25,-000; and, by inadvertence and mutual mistake of the plaintiff and defendants, the said guaranty failed to state specifically and in terms said indebtedness covered by said two notes; and they ask that, by a decree of the court, said guaranty be so reformed and corrected as to cover said two notes, the past indebtedness of the said Burton-Gardner Company to respondent, as well as future advances to be made, as they say was the true agreement, understanding, and intention of the parties. This is denied by the appellants, and they say that the guaranty was
H. S. Young, a witness for the plaintiff, testified, in substance, as follows: “Dinwoodey said he would not indorse the notes of the Burton-Gardner Company. At another time he said he would sign the notes. At another time Dinwoodey said to go ahead and get judgment, and he would buy the judgment; told me to figure up the amount of the Burton-Gardner Company’s debts, and draw a note for a long time, and at a low rate of interest, and hé would sign it. I drew the note, and he said he wanted to see the other directors of the Burton-Gardner Company and
W. S. Burton, a witness for the plaintiff, testified, in substance, as follows: “Dinwoodey said he would sign the Burton-Gardner Company notes. I told Dinwoodey that we needed more -money, and could get it at the Deseret National Bank, if all the directors would sign the guaranty. He first declined, and then signed the guaranty. I told him that we would have to have some more money, and he agreed that he would sign with the other directors of the Burton-Gardner Company in getting that money. I called on Dinwoodey, and handed him the guaranty. He read it, handed it back, and declined, to sign it. I did not explain the paper to him. He read it himself. After-wards, in company with L. G. Hardy, I told Dinwoodey that we must have some more money. I said, ‘The bank will advance the amount required, if you will sign this paper with us;’ and he then signed the guaranty. He (Dinwoodey) told me on several occasions that he would not sign for the Burton-Gardner Company, and afterwards said he would. I did not tell any of the defendants that the guaranty was to cover back indebtedness of the Burton-Gardner Company. I took the guaranty to them to sign, for the purpose of getting more money from the bank. There never was any meeting of the board of directors at which any concurrent action was taken relative to the guaranty.”
L. S. Hills, a witness for the plaintiff, testified, in substance, as follows: “Dinwoodey came to the bank, and
John C. Cutler, a witness for the plaintiff, testified, in substance, as follows: “Dinwoodey agreed to sign the note for the whole amount that the Burton-Gardner Company was owing, if he could get a long-time note and low interest. When the written guaranty was brought out by Mr. Young, Mr. Dinwoodey said: ‘I am liable for it; I am liable for that, and will have to protect it.’ ”
James T. Little, a witness for the plaintiff, testified, in substance, “that at a meeting of the board of directors Din-woodey said he would give a note for the amount of the Burton-Gardner Company notes, if it was for a long time and a low rate of interest. The guaranty was there. I do not remember the exact language used by Dinwoodey on that occasion.”
Leonard G. Hardy, a witness for the defendant, testified, in substance, as follows: “I first heard of the guaranty (Exhibit A) some time in March, 1892. I came into the bank one day (it would be some time about the 17th of March), when Mr. Young handed me that guaranty, and asked me to sign it. That was the first time I had ever heard of it in that shape; had heard of it, but in a general way. We talked about getting securities for the company, but no definite plan had ever been devised in the matter. This was the first time I had ever heard of this particular guaranty. The first time I ever saw it, Mr. Young asked me to sign it, that they might have the paper there, to avoid running around to get signatures every time the company wanted to borrow money. Nothing at all was said about past notes. He simply spoke of the company desiring to get money, and this was for that pur
W. S. Burton, recalled by defendants, testified, in substance, as follows. “I took the guaranty around to part of the signers personally. When I presented it to the defendants, with the exception of Mr. Dinwoodey and L. G-. Hardy, I don’t think there was anything said with regard to the amount of money we wanted to obtain. I had previously told them that we wanted to borrow $2,500 more. I don’t think there was anything said as to the amount to be borrowed. I simply told them I wanted to get some more money, and that they had to sign the paper before I could get it. I had told them before that I wanted about $2,500 at that time. I told them at this particular time I wanted to get $2,500, and I had to explain to them that there was large contracts on hand,”
Elias Morris, a witness called for the defendants, testified, in substance, as follows: “W. S. Burton didn’t, at any time prior to March 17,1892, say to me, or in my presence, that the Deseret National Bank was in any way dissatisfied with the security they then had for the indebtedness of the Burton-G-ardner Company at any time. I never heard of the written guaranty (Exhibit A) until Mr. Burton came around with the paper to be signed. I think I signed it the same day he brought it. I didn’t converse with any one except W. S. Burton before signing it. He said that we were very short of means or funds to go on
Henry Dinwoodey testified, in substance, as follows: “The first time I saw Exhibit A was in March, 1892. I first heard of it when it was presented to me, some two or three days before I signed it. W. S. Burton presented it to me. I- told Mr. Burton, after I looked at it and read it, that I didn’t want to sign it. I didn’t want to be mixed up with the affairs at all, and I said that I wouldn’t sign it. He told me that he wanted to raise some money to finish some contracts that they had under way, and that that was the reason he wanted me to sign it. He didn’t state any specific amount of money that he wanted. I think that was all the first conversation. I saw Exhibit A again two or three days after. W. S. Burton and L.
O. H. Hardy, a witness for the defendants, testified, in substance, as follows: “I first heard of this guaranty (Ex-hibí t A) about the time it was presented, in March, 1892. Never heard of it before. It was probably three or four days before I signed it after I first heard of it. W. S. Burton presented it to me. He told me that it was for — he said that they wanted some money for immediate use; that they had some contracts that they wanted to finish, and they wanted some money to finish them with. I was al
It must be evident, from the above evidence, which is, in
We are clearly of the opinion, therefore, that respondent is not entitled to have said written instrument reformed, either upon the theory of mutual mistake in its execution, or mistake of law, there being no fraud or deception charged in the pleadings, or attempted to be proven upon the trial, but that the parties must stand upon the instrument as it appears upon its face and the rights accruing therefrom.
This brings us to the consideration of the legal effect of the instrument and the rights accruing thereunder. Language, although not a perfect medium of thought or intention, is yet the most perfect which we possess. Whenever it is employed in any legal instrument it must be taken as the expression of the real intention or thoughts of the persons using it. If there shall be no ambiguity apparent,
Tested by the above rules, what are the terms of the contract? It says: “For value received, we, or either of us, promise to pay to the Deseret National Bank of Salt Lake City any and all sums of money which the said bank may loan or advance to the Burton-Gardner Company upon notes, or on their accounts, to the amount of $25,000, and with interest on said loan or advances from the time the same are made, respectively, at the rate of ten per cent, per annum until paid; said payment to be made upon demand.” Can any person say that there is a word in said instrument that makes the slightest reference, directly or indirectly, to any past transaction? To do so, it seems to us, would be to entirely disregard all rules of interpretation. We must therefore hold that, under the written instrument, the appellant was liable only for loans and advances made to the Burton-Gardner Company after the execution of the instrument, and not for pre-existing debts, in accordance with the terms of the contract.
But it is contended that respondent’s Exhibits F and G, being twd promissory notes of the Burton-Gardner Company to respondent bank, for $10,000 each, dated April 17, 1892, and May 16, 1892, respectively, were new loans or
The evidence in this case discloses no express agreement between the parties binding the appellant upon this sub
Numerous other errors are complained of, but their determination is unnecessary. The findings, judgment, and decree of the lower court reforming the contract, and entering judgment against the appellant, are reversed and set aside, and the case is remanded to the trial court, with directions to said court to make an accounting between the parties, and ascertain the amount of money advanced on notes, overdrafts, or otherwise by the bank to Burton-Gardner Company at and subsequent to the date of the making of the written Exhibit A by the appellant, Din-woodey, on March 17, 1892, together with the interest thereon, and to render judgment against said appellant, Dinwoodey, for such amount found due, in accordance with this opinion, together with costs of this appeal; and the court below will assess its costs as it may seem proper in the premises.
Concurrence Opinion
(concurring as to tbe conclusion of tbe court, except as to tbe taxation of costs.)
Tbe plaintiff claimed about $4,000 advanced to Burton-Gardner Company after tbe execution of tbe note or guaranty described in tbe opinion of tbe court, and $20,000 advanced to that company before that time. Tbe defendant Dinwoodey offered to pay the advancement made after tbe execution of tbe guaranty, but refused to pay tbe $20,-000 advanced before. Tbe court below held on demurrer that Dinwoodey was not bound by tbe guaranty to pay tbe last-named sum, and tbe plaintiff amended its complaint, alleging a-mutual mistake in drawing tbe guaranty, and that it was intended to cover tbe advances before its date as well as after. Tbis Dinwoodey denied, and tbe court entered a decree reforming tbe guaranty, and entered judgment against Dinwoodey for.tbe $20,000 as well as the amount of tbe advancements after tbe execution of tbe guaranty. To reverse tbe decree reforming tbe guaranty and tbe judgment as to tbe $20,000, Dinwoodey appealed, and tbis court reversed tbe decree reforming tbe guaranty and tbe judgment, so far as it included tbe $20,-000, and directs tbe court below to enter judgment only for tbe amount of tbe subsequent advances. Tbe appellant succeeds on bis appeal, and yet tbe opinion of tbe court taxes the costs of tbe appeal against him, amounting to about $800. Tbis I believe to be wrong.' Those costs should have been taxed against tbe plaintiff, the party defeated. Dinwoodey could only get rid of tbe $20,000 by tbe appeal.