LIABILITY UNDER GUARANTEE.

Auckland Star, Volume LVII, Issue 9, 12 January 1926, Page 5

LIABILITY UNDER GUARANTEE.

APPEAL ON LAW AND FACT. DISMISSED BY JUDGE. An appeal on law and fact from a judgment of tbe magistrate at Whangarei, which was heard last November, was the subject of a reserved judgment by His Honor Mr. Justice Reed at the Supreme Court this morning. The appellant was Thomas Orr Haycock (Mr. Biss), and the respondent St. Clair Jounneaux (Mr. Richmond). His Honor stated:— "The question to be determined is whether or not the appellant had been discharged from his liability under a guarantee which he gave to the respondent on the 20th October. 1020. It is in the following terms: 'To St. Clair Jounneaux. Whangarei. In consideration of the deeds of the Mama property sold by you having been made out lin my son's name, I hereby guarantee I payment to you of the principal moneys j and interest due thereon in accordance | with the arrangement made for the terms of payment of the purchase price and interest.' "It is contended that the appellant is not bound by the guarantee upon grounds which may be stated shortly as follows: (1) That material alterations were made in the terms of the principal contract between the respondent and the debtor (the appellant's son) without the knowledge or consent of the appellant (2) That even if such consent were given it was withdrawn before the altered contract was entered into. (3) That the principal debtor was released by the respondent, from his debt, and therefore his surety is also released. (4) That the guarantee was given subject to j a condition precedent which was never performed. It was also contended that the appellant was released by time being given to the principal debtor and a i promissory note taken for overdue in-; forest, but this ground was definitely abandoned before mc." li lt is contended that the guarantee was given subject to a condition precedent which was never performed. This point arises in connection with the stipulation, made by the solicitors, who were acting both for the appellant and i his son, when handing over the guarantee, that an undertaking by tbe respondent to secure a renewal of Finlayson"s mortgage for five years should be amended to extend to seven years. It is claimed that the undertaking was never amended and that the guarantee therefore never came into operation. An alleged copy of the undertaking I before the court; in it the five has no ll been altered to seven. But, there g a letter from the appellant's solicitors. "There' is no explanation as to where the document is that was before tl c solicitors when they wrote -this letter; it is clear, however, that they had an undertaking with the alteration from five to seven years. It is, however, immaterial; if, by inadvertence, the five was not altered to seven, it is clear that the provision for seven years could have been enforced. Moreover, the contract was carried out in its entirety, the mortgage that was given to the Public Trustee on the rearrangement of the ! finances being for seven years. "This disposes of the various grounds of appeal, and, for the reasons I have istated, I do not think any of them are j well founded. The appeal must be dis-' I missed with costs, £12 12/."