Lake v. Thomas

Citations

• 84 Md. 608
• 36 A. 437
• 1897 Md. LEXIS 12

Syllabus

<p>Principal and Surety— Guaranty of Faithful Performance of Duty by an Agent—Liability of Sureties—Changing Time of Settlement— Retaining Agent in Employment After Knowledge of His Defalcation—Notice to Surety of Defalcation of Agent—Pleading— Amended Pleas.</p> <p>K bond conditioned for the faithful performance of duty by an agent in ' paying over money collected by him, &c., provided that the agent should pay over the money upon the first call or demand of the principal. In an action against the sureties on the bond by the creditor a plea averred that the plaintiff changed the time and manner of settlement provided in the bond. Held, that this plea was bad because, according to the terms of the bond, this matter was left to the dis- ' cretion of the plaintiff, and also because the plea does not allege that the change was made before defalcation by the agent.</p> <p>While a surety is discharged if the contract is materially changed without his consent, yet an agreement between the creditor and the principal obligor, which is not a binding contract, to extend the time of payment or change the original contract does not operate to discharge the surety. The mere indulgence by the creditor in collecting a debt due him does not discharge the surety of the debtor.</p> <p>In an action on the above-mentioned bond another plea set forth that the plaintiff had knowledge of the defalcations of the agent shortly after the occurrence thereof, but kept the agent in his employment and permitted the defalcations to continue. Upon demurrer to the plea, Held., that the demurrer was properly sustained, because even assuming that the defendants were not liable for defalcations committed by the agent after knowledge by the plaintiff' of his prior defalcations, yet the fact that he was retained in his employment would not discharge the sureties from liability for such prior defalcation.</p> <p>The failure of the creditor in a bond of indemnity to give voluntary-information to the suret