N. B. Trulock et al v. J. R. Blair

Oklahoma Supreme Court1899-06-15

8 Okla. 345

Summary · law.co

Holding. The judgment is reversed and a new trial awarded to the plaintiffs. Blair's promise to pay for ice was an original contract enforceable against him, not a collateral promise to guarantee another's debt, because the credit was extended based on Blair's express promise for his own benefit, and the entry of the account in McCormick's name was merely a bookkeeping accommodation at Blair's request.

The plaintiffs sold ice to Blair on credit, though the transaction was recorded in their books under the name of McCormick, who was Blair's employee. Blair had expressly promised to pay for the ice, which he ordered for use in his beer business. The lower court presumed that because the account was entered under McCormick's name, the debt belonged to McCormick and Blair's promise was merely collateral—a guarantee of another's debt that would be unenforceable without a written agreement.

The court rejected this reasoning, holding that the account entry was not conclusive proof of who received the credit. The court found that the plaintiffs extended credit based solely on Blair's promise and had no knowledge of McCormick's financial condition. Blair had requested that the account be kept in McCormick's name for his own accounting purposes, not to shift liability. Critically, Blair ordered the ice for his exclusive benefit—to preserve his own beer—and pursued the transaction persistently through multiple communications.

Because Blair's primary purpose was personal gain rather than becoming a surety for another's debt, his promise was enforceable as an original contract despite lacking written formalities. The court reversed the judgment and ordered a new trial in plaintiffs' favor.

Summary generated by law.co from the public-domain opinion. The opinion text itself is public domain.

Key issues

Whether a promise to pay for goods ordered and used for the promisor's own benefit is an original contract or a collateral guarantee of another's debt
Whether the manner in which a debt is recorded in a creditor's books is conclusive evidence of to whom credit was extended
Whether a promise outside the statute of frauds is enforceable when made for the promisor's primary benefit rather than as a surety

Procedural posture

The trial court entered judgment against the plaintiffs based on a demurrer (or upon the evidence), treating Blair's promise as an unenforceable collateral guarantee, and the plaintiffs appealed.

Authorities cited

No cited authorities resolved to law.co cases yet.

Opinion · public domain

majority opinion

Opinion of the court by

McAtee, J.:

For the, purposes- of the demurrer the truthfulness of all this testimony is conceded1. We presume that the judgment below was rendered upon the supposition that, inasmuch as the goods were -charged on the books of the company to McCormick, the debt was the debt of McCormick, and the promises made by Blair, -and his liability, if any, were collateral, and to pay -the debt of another, and therefore not binding. But the fact that the goods were charged on the books of the" company to McCormick was only evidence tending to .show that -the credit was given to McCormick, and was by no means conclusive. It was a fact open to explanation, and to be considered in connection with all the other testimoy offered by the plaintiffs, in order to determine to whom the credit was given. The ice was ordered by Blair upon the express promise that he would pay for it. McCormick was his employe in- the business of selling beer, and the ice was ordered for Hie purpose otf preserving the beer from spoiling, and the beer was Blair’s. The credit was given upon Blair’s account atone, as shown by this testimony, and was entered to the account of McCormick, in order to oblige Blair, and upon his own request. The plaintiffs had no knowledge otf McCormick, did not know his financial condition, and gave no credit to him. The evidence shows that the credit was extended exclusively to Blair. The fact that the account was entered in the name of McCormick did not necessarily imply that any credit was given to him at all. ■ Under the evidence in this case, we think it may be properly said that the only presumption which arises from that fact was that, imagfmuch as Blair requested that the account should be kept in- the name otf McCormick, he made the request for the purpose otf keeping his own account with McCormick clear. Upon this state of facts, the judgment should have been for the plaintiffs. The conclusion upon this evidence must be that the contract was an original contract with Blair, and that the promises made were not collateral to any agreement of the plaintiff company with McCormick. (Calahan v. Ward, 45 Kan. 545, 26 Pac. 53; Burkchalter v. Farmer, 5 Kan. 289; Amort v. Christofferson [Minn.] 59 N. W. 304; Maurin v. Fogelberg [Minn.] 32 N. W. 858.)

The object otf the order for the ice made by Blair; the purpose for which it was used, and for which he wanted it and for which he ordered it, which was for his own benefit; the persistence with which he ordered it by telegram; by letter, and by visits to El Remo; and the application of the ice to the preservation of his stock of beer,- — -clearly manifest that the Sole purpose of Blair was his own private-benefit, not the benefit of McCormick; and wherever the lealdin-g purpose of á person, who agrees to pay the debt of another is to- gain some advantage or promote some-interestor purpose of hi® own, and not to become a mere guarantor or surety for another’s debt, and the promise is made upon a sufficient consideration, it will be valid,, although not in writing, and the -contract is not within the statute of frauds. (Fitzgerald v. Morrissey, [Neb.] 15 N. W. 234; Clopper v. Poland, 12 Neb. 69, 10 N. W. 538; Nelson v. Boynton, 3 Metc. [Mass.] 396.)

The judgment of -the court below will be reversed, and. ■a new trial awarded to the plaintiffs in error.

All of the Justices concurring.