Phœnix Brewing Co. v. Rumbarger

Citations

• 181 Pa. 251
• 37 A. 340
• 1897 Pa. LEXIS 537

Syllabus

<p>Principal and surety — Change of original agreement — Delay.</p> <p>In general any act of a creditor which prevents a surety from insisting on the fulfilment of a contract as originally made, or which entitles the principal debtor to delay, is a ground of defense in an action against the surety; but in order to exonerate the surety it must appear that the original obligation was changed by a binding agreement, and the new contract must be such as would be a valid defense by the principal debtor to an acLion on the original agreement.</p> <p>In an action against a surety upon a bond it appeared that the bond was conditioned that the principal should pay all accounts for beer and liquors purchased by him of the plaintiff in pursuance of a contract made and a course of dealing established “ when and as often as the same may-fall due, or when thereunto legally required.” Nothing was due when the bond was given. The beer was purchased every few days, and payments on account were made from time to time. The debt steadily increased, and at the end of fourteen months amounted to a large sum. Without any agreement between the parties as to the amount due on the open account, the principal, without any request and wholly of his own motion, gave two judgment notes to the creditor for the balance that appeared from his books to be due. The receipt of the notes was not acknowledged and the notes were not credited on the plaintiff’s books. At the end of three months payment of the whole account was demanded, but at the request of the principal, plaintiff waited until maturity of the second note, when judgment was entered on it and execution issued. Held, (1) that it must be presumed in the absence of any stipulation on the subject that it was contemplated by all the parties that there was to be an allowance of the usual credits; (2) that the court could not assume that the allowance of three or six months was unusual or unreasonable; (3) that there was no such giving of time t