Bell v. Bruen. 1 H.

guarantee, and its acceptance, and the construction put by the circuit court thereon, are stated in the opinion of the court.

This court having deemed certain extraneous facts, which preceded and accompanied the letter of guarantee, material to be considered in putting a construction thereon, those facts are here stated. They are, that on the 23d February, 1831, Thorn wrote to Bell and Grant a letter from which the following is an extract:

"My friends in Marseilles might secure many consign- [170] ments for me, if I could put them in a situation to make the necessary advances, and I therefore hope you will oblige me by opening the credit I ask for, and, if you require it, Mr. M. Bruen will give you his guarantee. I inclose a letter for Messrs. Archias and Co., which you will forward to * them, should you think [ *171 ] proper to open the credit; otherwise, I do not wish you to send it, as it relates entirely to this credit, and the manner in which the advances are to be made; it is understood, that no more than £2,000 are to be drawn for at any one time, and that the credit is then to be considered at an end, until your advances are covered by remittances from me, when you will again renew it."

On the 22d of March, 1831, Bell and Grant replied: "We have received, since the above, your letter of the 23d ult., with an inclosure for Messrs. Archias and Co., of Marseilles, which we forward to them to-day, with a confirmation of the credit you give them upon us to the amount of £2,000, for the purpose of making advances on consignments, and which we will accordingly thank you to have guaranteed to us, as you propose, by Mr. Matthias Bruen."

* In the trial of the cause in the court below, the plaintiffs [ *175 | proved that the credits given to the various houses who drew

the bills, were given by Bell and Grant in full reliance on the letter of guarantee which had been written to them by the defendant.

Lord and Sergeant, for the plaintiffs in error.

Choate, contrà.

[ *180 ]

* CATRON, J., delivered the opinion of the court. The original action was founded upon a guarantee given by Matthias Bruen to Bell and Grant, in favor of Wm. H. Thorn, by the following letter:

New York, 23d April, 1831.

MESSRS. BELL AND GRANT, London. DEAR SIRS: Our mutual friend, Mr. Wm. H. Thorn, has informed me that he has a credit for £2,000, given by you in his favor with Messrs. Archias and

Bell v. Bruen. 1 H.

[181] * Co., to give facilities to his business at Marseilles. In expressing my obligations to you for the continuation of your friendship to this gentleman, I take occasion to state, that you may consider this, as well as any and every other credit you may open in his favor, as being under my guarantee.

I am, dear sirs, your friend and servant,

M. BRUEN.

To this letter the following answer was given by Bell and Grant: London, 14th June, 1831.

your

MATTHIAS BRUEN, Esq., New York. We are in the receipt of favor of the 23d April, guaranteeing the credit opened on behalf of Mr. Wm. H. Thorn with Messrs. Archias and Co., of Marseilles, for £2,000, for the purpose of facilitating his business with that place; and, moreover, desiring us to consider as under your guarantee, also, all credits existing, or that we may hereafter open for said friend, of which we take due note. And we trust that Mr. Thorn, as well as your good self, will have every reason to be satisfied with the confidence which we feel a pleasure in assigning to both of you."

The declaration contains four counts:

1. That the plaintiffs, on the 31st of March, 1836, were requested by Thorn to open a credit in his favor, authorizing the firm of La Cave and Echicopar, of Cadiz, to draw on the plaintiffs to the extent of £2,500. That on the 22d November, 1836, La Cave and Echicopar drew for £385, which was advanced on the 12th February, 1837, by the plaintiffs, according to Thorn's request.

2. That on the 10th of October, 1834, at the request of Thorn, a credit was opened in his favor, authorizing R. Anderson and Co., of Gibraltar, to draw for £4,000. On the 16th December, 1834, Anderson and Co. drew for £318 12s. 6d. : which plaintiffs paid, 19th March, 1837.

3. That on the 15th of August, 1836, the plaintiffs opened a credit in favor of Thorn, authorizing Amac, Zipcey, and Co., of Smyrna, to draw for £3,500. Of this sum, the house at Smyrna drew £1,640: which plaintiffs paid, 8th April, 1837.

4. That on the 8th March, 1837, plaintiffs opened a credit to Thorn, himself, for £3,500, for which amount he drew bills; and which were paid, 17th June, 1837.

Much other correspondence and evidence was given to [*182] the *jury, that need not at present be referred to; but which appears in the statement of the case made out by the re

porter, and presented to us.

The evidence being closed, the defendant prayed the circuit court to instruct the jury, as matter of law, that the letter of guarantee, of

Bell v. Bruen. 1 H.

April 23, 1831, was confined to credits to be opened to the house of Archias and Co., or other houses with whom Thorn might deal at Marseilles; and therefore the plaintiffs could not recover from the defendant the advances made upon the bills of exchange given in evidence; being for the sums paid, as stated in the four counts of the declaration.

Thereupon the court did decide, as matter of law, "that by the true construction of the said letter of guarantee, of April 23, 1831, the same only embraced credits which should be opened for account of Wm. H. Thorn to the house of Archias and Co., of Marseilles ; and that the evidence of the other matters in this behalf proved, did not give the said letter of guarantee a more enlarged application. And therefore, that the jury ought to find a verdict for the defendant." The jury found accordingly; and it is this instruction of the court alone, that we are called upon to examine and revise. Does the letter of guarantee extend to, and cover the debts of Wm. H. Thorn sued for? is the question. It was an engagement to be executed in England, and must be construed and have effect, according to the laws of that country. Bank of the United States v. Daniel, 12 Pet. 54, 55. But it is necessary to remark that the law governing the agreement is the same in this country and in England; had it been made between merchants of different States of this Union, and intended to be executed at home, the same rules of construction would be adopted, and the same adjudications would apply.

It is insisted for the plaintiffs, that the circuit court erred in determining the question absolutely as a question of law, upon the construction of the letter; that it also erred in declaring the other circumstances did not allow of an application of the guarantee to the transactions in question; such other circumstances, being admitted, their effect on the extent and application of the guarantee was for the jury; and by deciding on their effect as matter of law, they were withdrawn from the jury.

*The letter of Bruen was an agreement to pay the debt [* 183] of another on his making default: by the statute of frauds, 29 Chas. II. such agreement must be in writing, and signed by the party to be charged; it cannot be added to, by verbal evidence; nor by written either, if not signed by the guarantor, unless the written evidence is, by a reference in the letter, adopted as part of it.

But as the statute does not prescribe the form of a binding agreement, it is sufficient that the material parts of it appear either expressed, or clearly to be implied; and correspondence and other evidence may be used to ascertain the true import and application of the agreement; by the aid of which extrinsic evidence, the proper

Bell v. Bruen. 1 H.

ocnstruction may be made. Such is the doctrine of this court, as will be seen by reference to the cases of Drummond v. Prestman, 12 Wheat. 515; Douglass v. Reynolds, 7 Pet. 113; Lee v. Dick, 10 Pet. 482.

In the present instance, the question having arisen, and construction been called for, the matters referred to in the letter of the defendant, were considered, (as circumstances attending the transaction,) to aid the court in arriving at a proper understanding of the engage ment: so soon as it was understood, its construction belonged to the court, and was, "matter of law," within the general rule applicable to all written instruments. It rested with the court to decide, whether the guarantee extended to, and covered the credits set forth in the declaration; and was the common case of asking the court to instruct the jury, that the plaintiff had not proved enough to entitle him to recover, admitting all his evidence to be true. In England, the same end is attained, by moving for a nonsuit.

For the defendant it is contended: That the letter of April 21, 1831, is a contract, preceded by a recital, and that the engagement extends no further than the recital.

The recital introduces in direct terms, or by reference, the entire arrangement made between plaintiffs and Thorn, by the letters of the 23d of February, 1831, and March 22, 1831; and the words "this credit," in the defendant's letter of 23d April, 1831, mean the first £2,000; and the words "and any and every other credit," mean the subsequent credits, to be opened under the same arrangement.

The general rule is well settled in controversies arising [184] on the construction of bonds, with conditions for the per

formance of duties, preceded by recitals, that where the undertaking is general, it shall be restrained, and its obligatory force limited within the recitals. The leading case, is Arlington v. Merricke, 2 Saund. 403. It has been followed by many others: Liverpool Waterwork Co. v. Harpley, 6 East, 507; Wardens, &c. v. Bostock, 5 Bos. & Pull. 175; Leadley v. Evans, 2 Bingh. 32; Pepin v. Cooper, 2 Barn. & Ad. 431, are some of the principal cases affirming the rule.

Where a mercantile guarantee is preceded by a recital, definite in its terms, and to which the general words obviously refer, the same rule applies, of limiting the liability, within the terms of the recital, in restraint of the general words. We find the courts constantly referring to the cases arising on bonds with conditions, for the rule of construction, and applying it to commercial guarantees; the most approved text-writers on this subject do the same; does the engagement before us fall within the rule? It recites:

Bell v. Bruen. 1 H.

"Our mutual friend, William H. Thorn, has informed me that he has a credit for £2,000, given by you in his favor with Messrs. Archias and Co., to give facilities to his business at Marseilles." The agreement is: "I take occasion to state, that you may consider this, as well as any and every other credit you may open in his favor, as being under my guarantee."

We are of opinion that the engagement should be construed as if it read: "You may consider this credit with Archias and Co. as being under my guarantee; as well as any and every other credit you may open in favor of William H. Thorn with any and every other person, as also being under my guarantee." And that therefore the first branch of the undertaking has reference to the recital; and that the latter part, is independent of it. To hold otherwise, would reject the general words" as well as any and every other credit" as unmeaning and useless; the agreement having the same effect, by the construction claimed for the defendant, if these words were struck out, as if they are left in it.

The general words, it is insisted, related to the character of the credit opened with Archias and Co., because it was an open and continuing credit, for £2,000. That this appears by the let

ters of Thorn to Bell and Grant, and to Archias and Co.; [ * 185 ] which are sufficiently referred to in the recital of the letter

to make them part thereof, and to extend it to the continuing credit with Archias and Co.

That the two letters of Thorn were sufficiently referred to, and could be read to establish the nature of the credit, and that it was open, we have no doubt; but their adoption was just as certain without the general words, as with them. The special reference to the recital, adopting it as explained by the letters, leaves the general words still without meaning, unless the guarantee extends beyond the credit opened with Archias and Co.

To make a proper application of the general words, it becomes necessary to lay down a definite rule of construction applicable to them, as the authorities are in conflict, and, to say the least, in considerable confusion, on the subject. The arguments are in direct conflict.

For the plaintiffs in error, (Bell and Grant,) it is contended : "That the guarantee by letters is to be taken, in case of doubt or ambiguity, on its face or otherwise, in the broadest sense which its language allows, and in which it has been acted on by the parties." Drummond v. Prestman, 12 Wheat.; Douglass v. Reynolds, 7 Pet.; Dick v. Lee, 10 Pet.; Mauran v. Bullus, 16 Pet.; Mason v. Pritchard, 12 East.; Merle v. Wells, 2 Campb. 413; Bent v. Hartshorne, 1 Met.;