The law of suretyship : covering personal suretyship, commercial guaranties, suretyship as related to negotiable instruments, bonds to secure private obligations, official and judicial bonds, surety companies

Front matter

Cornell University Library KF 1045.S79

The law of suretyship xovering personal

3 1924 018 848 261

Preface

The case law involving questions of suretyship is one of the largest constituents of the common law. The equities arising out of a suretyship relation are extended hy analogy to many transactions which cannot be denominated as obligations to pay the debt of another, but which come within the range of the essential elements of a suretyship undertaking.

Under this head may be classed generally all contracts in which two or more are jointly or severally bound for the same duty, also those contracts in which the debtor secures his obligations by the pledge or mortgage of his property, and many citations to this class of cases might be made which, though useful, would doubtless be an unnecessary encumbrance to a work in which the only aim is to present a direct statement of the law.

It is believed that all the distinctive features of a suretyship contract are illustrated by the cases cited in the text. There are in addition as many more cases which, because of statutory provisions or special conditions, have furnished a great variety of exceptional rulings.

The task of eliminating this class of precedents has been the most laborious, but possibly the most useful, feature of the work.

The past decade is of special interest to the student of the law of suretyship. The learning upon this subject is marked by a noticeable shifting in the attitude of the courts in refer - enee to the somewhat vexed problems involved. This is specially true in the matter of suretyship as related to negotiable instruments. The lack of harmony in the case law touching this branch of suretyship has defied all classification. The later cases, however, are bringing the subject into more rational accord.

VI. PEEFACE.

It is also true that the rights of the creditor or beneficiary of the suretyship are now receiving a more favorable constmction than was accorded by the earlier cases. This without doubt arises in part because of the advent of the Corporate Surety.

These corporations have challenged the attention of the courts to the more exact relations between the parties to a suretyship undertaking, and many of the later cases are in marked contrast to the earlier adjudications, which in many instances set down the law of suretyship as being merely a series of rules whereby a person bound to pay the debt of another is assisted in evading his liability.

The duty of legal editorship does not require more than to present with as much accuracy and precision as possible a statement of what the law is, and the sources from which it is derived, with some regard for the logical order in which the subject is developed. It excludes all speculation as to what the law ought to be.

The temptation, however, is exceptionally strong, in the field of Suretyship, to point out the importance of more uniformity in the solution of the problems presented.

The business of the great Commercial States in which the English Common Law is administered is today conducted upon a system of credit which involves the collateral obligations of third persons to an extent fully equal to the direct prom.ise of the debtor to pay, or to perform the duty contracted for, and there is a just demand for rules of universal aipplieation.

An examination of the cases with a view of pointing out a wider range of uniformity among the controlling precedents has been one of the distinct purposes of this work.

The author acknowledges his indebtedness to Geo. W. Piatt, Esq., of the Cincinnati Bar, who has read the manuscript and submitted many critical notes of value.

Aethue Adelbeet Stbaens.

Cleveland, December First, 1902.

Contents

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CHAPTEE I.

THE CONTRACT."