156 Iowa 144 | Iowa | 1912
Lead Opinion
Frohardt Bros. and Droge Bros, held two separate and independent claims against one Whitsett, and were theatening separately to attach Whitsett’s property, consisting of a livery stock, on which defendant had a chattel mortgage, and of which he had possession. Thereupon it is alleged that defendant promised to each of the respective creditors of Whitsett that if they would refrain from attaching Whitsett’s property in defendant’s hands and attacking the validity of defendant’s mortgage he would pay their respective claims, and this action is founded upon such oral promises. While the causes of action of the two plaintiffs are distinct and separate, they were, without objection, allowed to proceed as co-plaintiffs in this action. By separate appeals, the correctness of these two different portions of the final judgement is questioned. The appeal of the defendant from the judgment against him in favor of Frohardt Bros, will be first considered.
This ease is one of a class as to which it has been difficult for the courts to state any clear and consistent rule for the application of the statute of frauds, so far as it prohibits the introduction of oral evidence to prove a contract to pay the debt of another. There has been no difficulty in holding that agreements of guaranty, whether made before or after the guaranteed debt has been contracted, are covered by the statute, even though based on an independent consideration of detriment to the creditor or advantage to the guarantor. That is to say, adequate and lawful consideration for an oral contract of guarantee does not take it out of the statute. On the other hand it is' well settled (and no citation of authorities in support of the proposition is necessary) that an independent agree
While there was at one time, espdcially in the English courts, an inclination to treat as collateral, and therefore as within the statute of frauds every promise to pay the amount of another’s debt, the unmistakable weight of the more recent cases, especially in this country, has been in favor of sustaining, as against the statute of frauds, an oral promise to unqualifiedly and absolutely pay another’s debt on a consideration of advantage accruing to the promisor from such a promise. As was said in Emerson v. Slater, 22 How. 28, 43 (16 L. Ed. 360):
*148 Cases in which the guaranty or promise is collateral to the principal contract, but is made at the same time, and becomes an essential ground of the credit given to the principal debtor, are, in general, within the statute of frauds. Other cases arise which also fall within the statute, where the collateral agreement is subsequent to the execution of a debt, and was not the inducement to it, on the ground that the subsisting liability was the foundation of the promise on the part of the defendant, without any other direct and separate consideration moving between the parties. But whenever the main purpose and object of the promisor is not to answer for another, but to subserve some pecuniary or business purpose of his own, involving either a benefit to himself or damage to the other contracting _ party, his promise is not within the statute, although it may be in form a promise to pay the debt of another, and although the performance of it may incidentally have the effect of extinguishing that liability.
And in Nugent v. Wolfe, 111 Pa. 471 (4 Atl. 15, 56 Am. Rep. 291), this language is used, quoted with approval in Bailey v. Marshall, 174 Pa. 602 (34 Atl. 326):
It is difficult, if not impossible, to formulate a rule by which to determine, in every case, whether a promise, relating to the debt or liability of a third person, is or is not within the statute; but, as a general rule, when the leading object of the promise or agreement is to become guarantor or surety to the promisee for a debt, for which a third party is and continues to be primarily liable, the agreement, whether made before or after or at the time with the promise of the principal, is within the statute, and not binding, unless evidenced by writing. On the other hand, when the leading object of the promisor is to subserve some interest or purpose of his own, notwithstanding the effect is to pay or discharge the debt of another, his promise is not within the statute.
The following cases support the general proposition that, if the leading object of the promisor is not to become surety or guarantor of another, but to promote or sub-serve some interest of his own, his oral promise to pay
If the evidence is in conflict as to whether the promise is independent or collateral, the question is for the jury. Davis v. Patrick, 141 U. S. 479 (12 Sup. Ct. 58, 35 L. Ed. 826); McGowan Commercial Co. v. Midland Coal & Lumber Co., 41 Mont. 211 (108 Pac. 655); Johnson v. Bank, 60 W. Va. 320 (55 S. E. 394, 9 Ann. Cas. 893, and note. Some of the more recent of our own cases on the subject support the rule above announced. Pratt v. Fishwild, 121 Iowa, 642; Blake v. Robinson, 129 Iowa, 196; Harlan v. Harlan, 102 Iowa, 701; Carraher v. Allen, 112 Iowa, 168; Miller v. Adams, 142 Iowa, 515; Helt v. Smith, 74 Iowa, 667.
It is true that in some of these cases the facts involved did not necessarily require the announcement of such a rule as we are now recognizing. But we can not properly disregard the repeated announcement of such rule as having been made through misapprehension and oversight. Unless there are cases in this court which, as applied to the facts of this case, necessarily lead to a different result, we should give heed to our previous repeated statement of a general principle applicable to the case, although it may have been made under circumstances not giving rise to the precise question now before us. We fail to find among the cases in this court relied upon for appellant any deci
In Westheimer v. Peacock, 2 Iowa, 528, the statute of frauds was applied in an action brought against a father who had orally promised to pay his son’s debt; but the court said: “There is nothing to show that the defendant, when he made the promise, had in view or secured a benefit which accrued immediately to himself. On the contrary, his object was to obtain forbearance or benefit to his son. If for his own benefit, the promise would not be within the statute; if for the debtor, it would. And this distinction we think important, and one that is clearly recognized by the authorities.” In Sternburg v. Callanan, 14 Iowa, 251, the question was whether the defendant partnership had assumed the individual debt of one of the partners, and the court held the partnership was not bound, because there had been no novation, and held the jury should have been instructed that an oral promise by one of the partners to pay the individual debt of another partner could not be established by parol; but the question of the statute of frauds was not otherwise discussed. In Kauffman v. Harstock, 31 Iowa, 472, it was simply held that an agreement, upon certain contingencies, to step into the place of another, as to his debt, and to hold the creditor harmless, was within the statute of frauds. In Dee v. Downs, 57 Iowa, 589, was involved only the question whether an agreement to become surety for another was within the statute. In Vaughn v. Smith, 65 Iowa, 579, it was held that there was no new and indépendent consideration for the oral promise to answer for the debt of another, and that it was therefore within the statute of frauds. In Walker v. Irwin, 94 Iowa, 448, it was pointed out that the oral agreement relied upon was hot an original agreement, but one .obligating the promisor to step into the place of the debtor and pay his liability upon certain conditions, and that it was therefore collateral, although the
None of these cases are at all inconsistent in principle with the rule that an oral agreement, entered into on consideration of benefit to the-promisor, and relied upon by the promisee to his detriment, to pay to the promisee the amount of the claim of the latter against a third person may be enforced, without regard to whether the effect of the agreement is to release such third person from his liability; and we reach the conclusion -that the court properly submitted to the jury the question whether the oral promise of the defendant to pay to Frohardt Bros, the-amount of their claim against Whitsett was an original and independent obligation, entered into on account of anticipated benefit to defendant, or whether it was merely a collateral agreement to pay Whitsett’s debt, and that the judgment against the defendant in favor of Frohardt Bros, should be affirmed.
The final adjudication may consist of many judgments, or, when the claim consists of several parts or items, such judgments may be for either of the parts, or any specific part or item, of such aggregate claim, and against him on the other part thereof. Code, section 3769. It is not necessary now to determine whether the final adjudication as to the first and second counts was in-
The judgment of the trial court is therefore, on both appeals, Affirmed.
Dissenting Opinion
(dissenting in part). — I do not agree to the first branch of the majority opinion. It goes beyond any previous decision of this court. In practical effect, it is an evasion of the statute of frauds. My views are expressed in the former opinion filed in this case, which can be found in 132 N. W. 31.