17 Ga. App. 229 | Ga. Ct. App. | 1915
Suit was brought in the city court of Athens by Charles A. Ver Nooy against J. N. Webb, principal, and R. J. Hancock, E. H. Youngkin, and W. C. Pitner, as securities, on a promissory note. Hpon the trial it was agreed that Webb, Young-
We come, then, to consider whether, under the evidence in this case, there was any act of the creditor which injured the surety, increased his risk, or exposed him to greater liability, so as to discharge him. An agreement with the principal to extend the time of payment for a consideration moving to the creditor may discharge a surety. What was the consideration moving to Ver Nooy, according to the evidence in this case, for the purpose of securing an extension of the time of payment? It was admitted that Webb agreed to pay an additional one-half of one per cent, as interest; and yet, under code section 3436, and in pursuance of a sound public policy which required such an agreement to be in writing, Webb’s oral agreement was futile. But if it be said that the agreement was executed and that Ver Nooy actually received the amount of the one-half of one per cent, as extra interest each year, in what respect did that increase the liability of the surety Pitner or expose him to greater liability ? He was still bound only by the terms of his contract, which provided for the payment of the principal and seven and a half per cent, interest thereon; and not only this, but the additional one-half of one per cent, per annum paid in excess of the interest must be .credited, as a matter of law, upon the principal of the indebtedness evidenced by the note, and thus his risk is actually decreased. This would be true under the contention of counsel for defendant in error, though of course, as contended by counsel for plaintiff in error, if the jury should
For the reasons stated, the instructions of the trial judge on the subject of the discharge of the surety upon the ground of a novation of which complaint is made, were erroneous. The jury could not consider the evidence of a parol agreement for the purpose of determining whether there had been a novation of the contract, because it was not a contract which could be changed by parol. The evidence of the parol agreement might be considered by the jury in determining whether the agreement tended to increase the risk of the surety or to expose him to greater liability if it should appear that the agreement for an extension included a provision for an extension for a definite time.
The court erred in overruling the motion for a new trial.
Judgment reversed.