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Verbal

Evidence

inadmissible to supply the

drawn, and it did not appear that Wakefield had any thing to do with the drawing, or had requested Saunders to advance any thing upon it, and, consequently, it did not appear that there was any consideration for his promise to pay it.

In all these cases you must recollect that, if verbal evidence had been allowed, it would proConsideration. bably have appeared clear enough that there was a good consideration for the promise sued on; but as it is indispensably necessary that the consideration should appear, not from such evidence, but from the instrument itself, it became necessary in every case to look narrowly at the words with a view of ascertaining, as in the instances I have just put, whether, though it do not appear in terms, it may not be collected by inference. I think I have sufficiently explained the nature of these enquiries; but if you think fit to pursue the subject, you may refer to Raikes v. Todd, 8 Ad. & Ell. 846.; Bentham v. Cooper, 5 M. & W. 628.; Jarvis v. Wilkins, 7 M. & W. 410.; Brooks v. Haigh, 10 Ad. & Ell. 323.; and Kennaway v. Treleavan, 5 M. & W. 498.; which are the last decisions on this branch of the law. (a)

(a) In Kennaway v. Treleavan the guarantee was thus worded:-"Gentlemen, I hereby guarantee to you the sum of 250l. in case Mr. P. should default in his capa

city of agent and traveller to you." It was held that the future employment of Mr. P. was the consideration of this promise, and that it sufficiently appeared by inference

Fraudulent

There is one thing which, though collateral to Actions for the Law of Contracts, relates so peculiarly to Misrepresent

con

from the terms of the guarantee. But the case of Haigh v. Brooks, 10 Ad. & Ell. 309. is the strongest on this point, and has carried the latitude of inference to its extreme length: it was cited in the recent case of Chapman v. Sutton, 15 Law Jour. C.P. 166.; and the guarantee was thus worded: "In sideration of your being in advance to Messrs. John Lees and Co. in the sum of 10,000l. for the purchase of cotton, I do hereby give you my guarantee for that amount (say 10,000%) on their behalf;" and it was held, that whether the consideration, "your being in advance,” was, or was not, a good consideration, depended upon the transaction to which the guarantee referred. remarks, "Being in advance Being in advance does not necessarily mean that the plaintiff was in advance at the time of the giving of the guarantee. It may have been intended as prospective." The judgment in the Exchequer Chamber was given upon this ground, and Lord ABINGER C. B. said that "there was in the gua

Lord DENMAN C. J.

rantee an ambiguity that might be explained by evidence, so as to make it a valid contract."

Raikes v. Todd, above cited, is a good illustration of an insufficient disclosure of consideration. The guarantee was thus expressed :—" Gentlemen, I hereby undertake to secure to you the payment of any sums of money you have advanced, or may hereafter advance, to Messrs. Davenport and Co. on their account with you, commencing on the 1st November, 1831, not exceeding 20007.:" here it was held that the guarantee disclosed no consideration for the past advances, and was to that extent invalid, but that it was good as regarded the future advances. Thus, if the guarantee consist of severable promises, that which is bad may be rejected without invalidating the remainder of the guarantee. There is no practical difference between past and future considerations, so long as the guarantee discloses a sufficient consideration in law to support the promise (of which see the

ations.

Adequacy of consideration.

Written correspond

ence.

Continuing
Guarantees.

this branch of the statute of Frauds, that I think it ought to be mentioned. After the fourth

next lecture). The consideration need not be co-extensive with the promise. (See Raikes v. Todd, per Ld. DENMAN C. J.) And the Courts will no longer enter into the question of adequacy of the consideration. See Chapman v. Sutton (suprà), which is the last case where the question of the sufficiency of the inference of a consideration has arisen. See also Lang v. Neville, 6 Jurist, 217., and Johnston v. Nicholls, 1 C. B. 251.

It is permissible to adduce in evidence of the consideration the written correspondence between the parties, if that correspondence has been referred to in the guarantee, but not otherwise. See Dobell v. Hutchinson, 3 Ad. & Ell. 355., and Higgins v. Dixon, 14 Law Jour. Q. B.

329.

The rules which govern the construction of contracts, and which will be afterwards considered, of course apply to guarantees. But there is one peculiarity attaching to them which it may be well to notice here. Guarantees are either for definite or indefinite sums or periods: where they

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are not limited as to the amount guaranteed, or, being so limited, are in either case intended to affect future transactions until revoked, they are termed continuing guarantees. The distinction between these two classes of guarantee is one of some nicety and often of importance, as regards the sufficiency of the consideration, which again frequently depends upon whether it be past or prospective.

The only safe rule of construction is to give the words used their natural meaning, taking into account the attendant circumstances which are admissible in evidence to throw light upon the intent of the parties to the instrument. This rule has been recently applied in the case of Allnutt v. Ashendon, 5 M. & Gr. 392., where the guarantee was thus worded: "I hereby guarantee Mr. John Jenning's account with you for wine and spirits, to the amount of 1007." This was held to apply to an existing account; for, said TINDAL C. J., "by account I understand the parties to mean

section of the statute of Frauds had rendered verbal guarantees unavailable, it became the

some account contained in some ledger or book; and the case shews that there was such an account existing at that time. The natural construction of the guarantee therefore is, that it relates to that account." In the subsequent case of Hitchcock v. Humfrey, 5 M. & Gr. 559. the defendant, having guaranteed the payment of goods to be supplied by the plaintiffs to A. up to the 1st of July, gave on the 9th of April the following additional guarantee:

"In considera

tion of your extending the credit already given to A., and agreeing to draw upon him at three months from the 1st of the following month, for all goods purchased up to the 20th of the preceding month, I hereby guarantee the payment of any sum that shall be due and owing to you upon his account for goods supplied." This was held to be a continuing guarantee the words "following month" and "preceding month" being held to have a general application, the terms of the first guarantee being taken into account in con

struing the language of the second. For other cases of the construction put on these instruments, see Mayer v. Isaac, 6 M. & W. 605.; Jenkins v. Reynolds, 3 B. & B. 14.; Allan v. Kenning, 9 Bing. 618.; Batson v. Spearman, 9 Ad. & Ell. 298. ; Hargreave v. Smee, 6 Bing. 244.; Nicholson v. Paget, 1 C. & M. 48.; Martinv. Wright, 14 Law Jour. Q. B. 142.; and Johnston v. Nicholls, suprà.

The cases turn, as remarked by the Lord Chief Justice in that of Martin v. Wright, on the particular terms of each guarantee, and it is therefore impossible to lay down any less general rule of construction than that which we have endeavoured to give.

Promises to answer for Tortious defaults. tortious defaults are within the operation of the statute as well as guarantees of credit. Kirkham v. Marter, 2 B. & Ald. 613. is a leading authority on this point. A. having killed B.'s horse, C. guarantees to B., the owner, to answer for the damage: this was held to be within the statute. Lord C. J. ABBOTT

fashion in such cases to bring actions upon the case for false representations under circumstances in which, before the Act, the transaction would have been looked on as one of guarantee. For instance, if A. went to a tradesman to persuade him to supply goods to B. by assuring him that he should be paid for them, the tradesman, in case of B.'s default, could not, it is true, bring an action of assumpsit as upon a warranty, because there was no written memorandum of what passed; but he brought an action on the case in which he accused A. of having knowingly deceived him as to B.'s ability to pay: and if the jury thought this case made out (as a jury composed of tradesmen were very apt to do), he succeeded in his action, and received pretty nearly the same sum as he would have done if there had been a guarantee. However, as this was a palpable evasion of the statute of Frauds, the legislature put an end to it by enacting in statute 9 Geo. 4. c. 14., commonly called Lord Tenterden's Act, 9 Geo. 4. c. 14. "that no action should be brought to charge any person by reason of any representation or assurance made or given concerning or relating to

Lord Tenter

den's Act,

s. 6.

Shares in Joint
Stock Com-

panies.

distinguished this case from
that of Read v. Nash, 1
Wils. 305., but which Ser-
geant Williams thinks it
overrules. 1 Saund. 211 c,
n. l.

Shares in a Joint Stock

Company are mere choses in action, but Railway Shares, it is submitted, inasmuch as they give an interest in land, would fall under the operation of the 4th section.

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