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law, that it has a meaning other than that which is expressed upon the instrument.
A guarantee being a contract of indemnity, to make good the default of the party for whom the guarantee is given, is therefore not an absolute debt, but an engagement to pay what shall be found due from the principal, and until that fact is known, is in the nature of a claim for unliquidated damages, and not the subject of a set-off, within the statute 2 Geo. 2, cap. 22 (8); consequently, if A. sues B. at law for a debt, and at the time of action brought, A, had become liable to B. under a guarantee in respect of monies advanced by B. at A.'s desire, to a third party, which monies the plaintiff, though he had been requested by the defendant to pay, had not paid; the demand of B. under the guarantee, being unliquidated and unascertained, is not a debt, within the meaning of the Statute, and cannot in that action be set off by B. against A.'s demand (h). So, on the other hand, if B. is the surety, and A. the party to whom the guarantee is given, and A. sues B. upon his guarantee, under which B. had become liable, B. cannot, if a sum of money is owing to him from A., set-off that sum against the demand made by A. against him upon the guarantee; for the Statute only applies to mutual debts (i). But if it had been agreed between the party to whom the guarantee had been given, and the surety, that the
respect of his liability under the guarantee, a stipulated sum in the nature of liquidated damages, so that the intervention of a jury for the purpose of ascertaining the quantum of damages which the former party had sustained, is (9) Sect. 13.
() Sampson v. Burton, 2 Brod. (h) Morley v. Inglis, 4 Bing. & B. 89; S. C. 4 J. B. Moo. 515 ; N. C. 58; Crawford v. Stirling, and see Grant v. the Royal Ex4 Esp. 207; and see Howlet v. change Assurance Company, 5 M. Strickland, Cowp. 56; Weigall v. & Sel. 439 ; Hardcastle v. NetherWaters, 6 T. R. 488.
wood, 5 B. & Ald. 93.
unnecessary; then it seems that the sum fixed upon and admitted as the specified amount of the surety's liability, may be considered as in the nature of an amount stated, and a set-off would be allowed (j.)
If the plaintiff in replevin be nonsuited for want of a plea in bar, the avowant may sue the sureties on the bond, and need not execute a writ of inquiry for his damages (k); but if the sureties have been relieved from their liability under the replevin bond, in consequence of the plaintiffs having obtained a verdict at law, the Court will not grant the defendant a new trial, even on payment of costs, without very clear grounds, for the landlord has other remedies for his rent, and a new trial would renew the liability of the sureties, from which, by such verdict, they were exempt; as the plaintiff might by another trial be called on to pay double costs (1).
If the defendant at law having given bail obtains the common injunction for want of an answer, the creditor cannot proceed against the bail without a breach of the injunction (m), for a proceeding against the bail must be treated as a proceeding against the party (3); but if the defendant has been taken on an attachment issued from the Court of Chancery for want of an answer, gives the usual bail bond to the sheriff, and still refuses to answer, the plaintiff may, at the same time, proceed to
(j) See Wienholt v. Roberts, 2 Camp. 586; Thorpe v. Thorpe, 3 B. & Ad.580; Fletcher v. Dyche, 2 T. R. 32; and the observation of Tindal, C. J., in Morley v. Inglis, 4 Bing. N. C. 58.
(k) Waterman v. Yea, 2 Wils. 41.
( Parry v. Duncan, 7 Bing. 243.
(m) Leonard v. Attwell, 17 Ves. 385 ; Stone v. Tuffin, Ambl. 32.
(3) And so conversely, if a bill in equity has been brought by the principal debtor against the creditor for an injunction, to restrain the latter from proceeding at law, and which bill is dismissed, the bail cannot bring another bill, taking up the same equity, unless there is collusion between the creditor and the principal. (Anon. 2 Ves. 630.)
enforce an answer by the process of the Court, and bring an action against him and his sureties on the bond given to the sheriffs under the attachment (n); for the sureties have no right to appear, except through their principal, who, being in contempt, could not himself have appeared, and the giving of a bail bond would be quite useless, if no proceedings could be taken on it (o).
Where, on the dissolution of partnership between P. and C., the stock in trade, book debts, &c. were assigned to P. in consideration of a sum of money to be paid by instalments, to secure which, P. and S., as her surety, gave their joint and several bonds to C., and a warrant of attorney to enter up judgment against them as on a mutuatus, and judgment was accordingly entered up against P. and S. jointly, and the last instalment of the money secured having become due, P. filed her bill in equity against C., alleging errors in the amount of the debts, and praying an account, an abatement out of the instalment, and an injunction to stay legal proceedings against the plaintiff, but to which bill S. was not a party ; a proceeding by C. against S. on the judgment, after the common injunction for want of an answer had been obtained by the plaintiff, was held not to be a breach of the injunction; the surety obligor not being entitled to the injunction, when he is not a party to the suit (p).
Where the plaintiff, against whom a writ of ne exeat regno had issued, had gone abroad after entering into the usual bond with sureties, Lord Eldon, C., upon the application of the creditor, ordered the sureties to pay into Court the sum for which the writ was marked, within six months,
(n) Beddell v. Page, 2 Sim. 224.
(0) Beddell v. Page, supra ; and see the observations of Lord Hardwicke, C., in Stone v. Tuffin,
(p) Chaplin v. Cooper, 1 Ves. & B. 16.
together with the costs of the application (9); although it was suggested on behalf of the sureties, that the money claimed by the party making the application was on account, and not then proved to be actually due, and that the principal had put in his answer, which had not been excepted to, and had gone abroad under a mistake as to the effect of his bond, the condition whereof he presumed to be satisfied by the putting in of his answer (r).
It is said (s), that the creditor is not entitled to recover against the surety, the costs of a fruitless suit against the debtor, unless he give the surety notice of his intention to sue.
If the principal has become bankrupt, the creditor may prove under the commission, or may resort to the surety without proving under the commission, unless the creditor is an annuity creditor, and the bankrupt is the grantor of the annuity, in which case, the value of the annuity must be ascertained by the commissioners (t); and this, notwithstanding the annuity was granted previously to the passing of the 6 Geo. 4, cap. 16 (u); and the creditor cannot sue the surety until he shall have proved for the value of the annuity (U); or even take out ex ecution against the surety, where judgment had been entered upon a warrant of attorney, issued out against the bankrupt, the grantor of the annuity, and his surety, previously to the passing of the 6 Geo. 4, cap. 16 (W); for by the 55th section of this act, it is required that the value of the annuity be ascertained before the annuity creditor sue the surety, and the sueing out of execution is equivalent to a suit.
(9) Utten v. Utten, 1 Meriv. (u) Bell v. Bilton, 4 Bing. 615; 51 ; and see Musgrave v. Medex, S.C. 1 Moo. & P. 574. i Meriv. 49.
(v) 6 Geo. 4, cap. 16, s. 55 ; (r) Utten v. Utten, supra.
Bell v. Bilton, supra ; and see the (s) Per Best, J., in Baker v. observation of Alderson, B., in Garratt, 3 Bing. 56.
Maber v. Hobbs, 2 You. & Coll. (t) 6 Geo. 4, cap. 16, s. 54; and see ex parte Parton, 2 Deac. 62; (w) Hone v. Morgan, 4 Man. & S. C. 3 Mont. & Ay. 5.
But the Insolvent Debtors' Act (x) contains no provision similar to the 55th section of the Bankrupt Act, and the grantee of an annuity may, upon the insolvency of the grantor, immediately resort to the surety (y), though the effect of such proceedings would be, that by a circuity of action, the insolvent would remain liable in respect of the annuity, notwithstanding he procures his discharge under the Insolvent Act (2).
If the surety, upon the bankruptcy of the principal debtor, think proper to contest the question of his liability with the creditor, and allow the creditor to go in under the commission of bankrupt issued against the principal debtor, and the creditor prove his debt, the creditor is entitled to sign the bankrupt's certificate of conformity, notwithstanding he receive notice from the surety not to do so (a); for it is the duty of the surety to pay the debt, and if he declines so doing, and thereby permits the creditor to prove, the signing of the certificate of conformity, (which is a power given by the Statute to the proving creditor,) is a moral obligation on the creditor, and which the creditoris morally bound to exercise, where the creditor is placed in the condition to exercise it by the laches of the surety, and where the creditor is satisfied that the bankrupt has conformed to the provisions of the Statute; but if the creditor has been fully paid by the surety, the creditor will, upon the (2) 7 Geo. 4, cap. 57.
relation to the Principal: after (y) Hocken v. Browne, 4 Bing. Payment; where the Principal is 400; Abbott v. Bruere, 5 Bing. Insolvent."
(a) Browne v. Carr, 7 Bing. (2) See post, “Of the Rights
508; S. C. 2 Russ. 600. and Remedies of the Surety, with
N. C. 598.