ance of lia

a single transaction between the parties, and is Continuextinguished as soon as that takes place. The bility. cases on this subject can scarcely be reconciled without entering into very minute distinctions (n). The question in each particular instance almost entirely depends on the construction of the particular expression used in wording the undertaking; the general rule necessarily being, that, where the intention of the defendant appears to have been, that he would be answerable at any time to the amount mentioned, it is a continuing guaranty -but that where his intention apparently was to limit his liability to a specific transaction, it is not a continuing guaranty.

guarauties.

Thus, where the words were, that the defendant Continuing would be liable, "for any debts not exceeding £100, "which J. S. may contract with you for goods

66

necessary in his business as a jeweller" (o) or, "for any goods which he (plaintiff) hath or may

66

supply J. S. with to the amount of £100”(p); -it was held to be a continuing guaranty. So, where the guaranty was "for goods to the amount "of £200 to be delivered according to the custom "of trading between J. S. and the plaintiff," it was

(n) See per Bayley, B. 1 Cr. & Mees. 51.

(0) Merle v. Wells, 2 Campb. 413; S. P. Bastow v. Bennett, 3 Campb. 220.

(p) Mason v. Pritchard, 12 East, 227. These decisions seem to depend upon the use of the indefinite word "any." See 3 Campb. 221.

guaranties.

Continuing held that the £200 was not intended to point out the extent to which the goods should be from time to time supplied under that guaranty, but to indicate the extent to which the surety was willing to pay on his undertaking as a continuing guaranty (9). Again, where the guaranty, on the face of it, was expressed to be by way of inducement to the plaintiffs to continue their dealings with J. S., it was held to be clearly the intention of the defendant that his guaranty should be continuing until revocation, or further notice (r). Where the guaranty expresses that the liability shall be to a certain amount and during a specified time, it is a continuing guaranty within such period (s).

Non-continuing guaranties.

On the other hand, where the words have reference to a particular dealing between the parties, the guaranty is not continuing. Thus, the words, "I agree to be answerable for the amount of five sacks of flour to be delivered to J. S." (t); or,

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I engage to guarantee the payment of J. S. to the extent of £60 at quarterly account for

(q) Hargreave v. Smee, 6 Bingh. 244; S. C. 3 M. & Payne, 573; see 3 Tyrwh. 169, per Bayley, B.

(r) Allan v. Kenning, 9 Bingh. 618; S. C. 2 M. & Scott, 769. It seems that a continuing guaranty may be revoked by parol; Brocklebank v. Moore, 2 Stark. Ev. 371, n. (2nd Ed).

(s) Simpson v. Manley, 2 Tyrwh. 87; S. C. 2 Cr. & J. 13. See Williams v. Rawlinson, 1 Ry. & M. 233.

(t) Kay v. Groves, 6 Bingh. 276; S. C. 3 M. & Payne, 634; see Bovill v. Turner, 2 Chit. Rep. 205; Kirby v. Marlborough (Duke), 2 M. & S. 18.

tinuing

goods to be purchased by him of the plain- Non-contiffs" (u); were held insufficient to constitute a guaranties. continuing guaranty. So, an engagement “to be "answerable for the payment of £50 in case J. S. does not pay for the gin which he receives from you," was held not to be a continuing guaranty (r).

of surety.

III. The party entering into a guaranty may be Discharge discharged from his liability by, 1. Time being given to the principal. 2. Laches on the part of the plaintiff. 3. Fraud, or improper dealing between the plaintiff and the principal. 4. Agreement to discharge, before breach.

to principal.

1. It is a general rule in the law of principal and Giving time surety, that, by giving time to the former, the surety is discharged; on the principle, that by so doing the plaintiff has, unauthorizedly, altered the relative situation of the parties, since the surety can no longer have the same remedy against the principal, as he would have had under the original contract (y). By the expression, giving time,' is

(u) Melville v. Hayden, 3 B. & A. 593. This case certainly approaches very closely to Mason v. Pritchard, (ubi supra); for the Court observed that the words "quarterly account" were immaterial; see 3 B. & A. 594. Indeed the only difference seems to be the word "any." Vid. supra, p. 387.

(x) Nicholson v. Paget, 1 Cr. & Mees. 48; S. C. 3 Tyrwh. 164; 5 C. & P. 395.

(y) This rule is the same now both at law and in equity. See

of surety.

Discharge meant, "extending the period at which the principal debtor was originally liable, on the contract between them, to pay the creditor, and extending it by a new and valid contract between the creditor and principal debtor, to which the surety does not assent" (*). Therefore, where the usual course of dealing between the plaintiff and the principal was to give six months' credit, it was held that, by extending the credit to nine months, the goods to be then paid for by a bill at two (thus virtually giving eleven months credit), the plaintiff had discharged the defendant from liability on his guaranty (a). If the guaranty does not specify the terms of credit to be given, it will be held to mean, not the ordinary credit of trade, but such fair and reasonable terms of credit as may be agreed upon between the parties (b).

Laches.

2. Laches on the part of the plaintiff will exonerate the defendant. Thus, where the defendant undertook to indorse bills given by J. S. to the plaintiffs in payment for goods, provided appli

per Lord Eldon, Ch., 3 Meriv. 277. Rees v. Berrington, 2 Ves. Jun. 540; Nisbet v. Smith, 2 Bro. C. C. 579.

(z) Per Curiam, 1 Cr. M. & R. 107.

(a) Combe v. Woolf, 8 Bingh. 156; S. C. 1 M. & Scott, 241; Howell v. Jones, 1 C. M. & R. 97; S. C. 4 Tyrwh. 548; Samuell v. Howarth, 3 Mer. 272.

(b) Simpson v. Manley, 2 Cr. & Jer. 12; S. C. 2 Tyrwh. 86. See above, p. 385, as to non-compliance with the strict terms and conditions of the contract.

notice.

cation was made within convenient and reasonable Discharge of surety. time, it was held that negligence on the part of the plaintiffs, in suffering an unreasonable time to elapse, discharged the surety (c). Where the payment of a bill of exchange given for the price of goods by the vendee is guaranteed by defendant, he is entitled to notice of dishonour, and the want of such notice will exonerate his liability (d). But Want of if the defendant is not a party to the bill, and his guarantie extends to the payment generally of the value of the goods themselves, and is not confined to the mere discharge of the security, it seems not necessary to prove notice of dishonour, or even presentment for payment, where the vendee is notoriously insolvent (e). And in the case of guaranties in general, notice to the surety, of default made on the part of the principal, is not requisite in order to charge the surety (ƒ).

case,

(c) Payne v. Ives, 3 D. & R. 664. The guaranty, in this did not speak of the time of making the application; but the Court held that a reasonable time must be intended. The bills were at 18 months, and 17 months and 10 days were allowed to elapse, and J. S. had become insolvent, before the defendant was applied to.

(d) Philips v. Astling, 2 Taunt. 206.

(e) Holborow v. Wilkins, 2 D. & R. 59; S. C. 1 B. & C. 10. See Swinyard v. Bowes, 5 M. & S. 62.

(f) Goring v. Edmonds, 6 Bingh. 94; S. C. 3 M. & P. 259; Peel v. Tatlock, 1 B. & P. 419. The case of bills of exchange seems to be peculiar, on the ground that the party guaranteeing is considered to be somewhat in the situation of an indorser.