In all these cases you must recollect that, if verbal evidence had been allowed, it would probably 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 instance 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 inquiries; but if you think fit to pursue the subject, you may refer to Raikes v. Todd, 8 Ad. & Ell. 846, 35 E. C. L. R.; Bentham v. Cooper, 5 M. & W. 628; Jarvis v. Wilkins, 7 M. & W. 410; Brooks v. Haigh, 10 Ad. & Ell. 323, 37 E. C. L. R.; 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 2501., in case Mr. P. should default in his capacity 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 from the terms of the guarantee. But the case of Haigh v. Brooks, 10 Ad. & Ell. 309, 37 E. C. L. R., 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 consideration of your being in advance to Messrs. John Lees & Co. in the sum of 10,0007., for the purchase of cotton, I do hereby give you my guarantee for that amount (say 10,0007.) 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. Lord Denman, C. J., remarks: "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

1 See note to next page.

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

[*53-*54]

*this branch of the Statute of Frauds, that

as prospective." The judgment in the Exchequer Chamber was given upon this ground; and Lord Abinger, C. B., said that "there was in the guarantee 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 & Co., on their account with you, commencing on the 1st November, 1831, not exceeding 2,0007." 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 several promises, that which is bad may be rejected without invalidating the remainder of the guarantee. There is no practical difference between past and

'The recent cases have affirmed Haigh v. Brooks, and while reiterating the rule which forbids the introduction of parol testimony to explain such instruments, have, at the same time, decided that evidence is admissible to show the circumstances of the parties at the time of making the guarantee; Bainbridge v. Wade, 1 Eng. Law and Eq. R. 236; Colbourn v. Dawson, 4 Id. 378; Edwards v. Jervis, 8 Com. Bench, 436, 65 E. C. L. R.; Butcher v. Stewart, 11 Mees. & Wels. 837. Thus in Goldshede v. Swan, 1 Excheq. 154, the words were, "In consideration of your having thus advanced to our client, Mr. Dolphin, £750, we promise," &c., and it being objected that the guarantee was bad, as referring to a past consideration, parol evidence was held to have been properly admitted to show that the instrument was signed simultaneously with a check given to Dolphin. 2 Similar to this was Wood v. Benson, 2 Cromp. & Jervis, 94, where the guarantee was: "I engage to pay for all the gas which may be consumed in the M. Theatre, during its occupation by A. B.; and I also engage to pay for all arrears which may now be due;" and the Court held that, as regarded the future supply, the statute did not apply; as to the past, the contract was void, as without consideration.

3

It is, of course, otherwise where the contract is an entire one, and incapable of apportionment, or if it is declared on as an entire pro

I think it ought to be mentioned. After the fourth *section of the Statute of Frauds had rendered

verbal guarantees unavailable, it became the [*55]

future considerations, so long as the guarantee discloses a sufficient consideration in law to support the promise (of which see the 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 (supra), 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 Johnson v. Nicholls, 1 C. B. 251, 50 E. C. L. R.

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, 30 E. C. L. R., 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 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, 44 E. C. L. R., where the guarantee was thus worded: "I hereby guarantee Mr.

mise; in which case, if any part of the contract be vitiated by the statute, there is a variance-a failure of proving the contract as laid; Lexington v. Clark, 2 Ventries, 223; Chate v. Beckett, 7 Term, 201; Thomas v. Williams, 10 Barn. & Cress. 664, 21 E. C. L. R.; Crawford v. Morrell, 8 Johnson, 253; Holloway v. Hampton, 4 B. Monroe, 415.

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*fashion in such cases to bring actions upon the case for false representations, under circumstances

John Jennings'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 some account contained in some ledger or book; and the case shows 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, 44 E. C. L. R., the defendant, having guaranteed the payment of goods to be supplied by the plaintiffs to A., up to the first of July, gave, on the 9th of April, the following additional guarantee: "In consideration of your extending the credit already given to A., and agreeing to draw upon him at three months from the first 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 construing the language of the second. For other cases of the con

1 So a guarantee, "If D. wishes to take goods of you, we are willing to lend our names as security for any amount he may wish," was held not to extend beyond the first delivery of goods; Rogers v. Warner, 8 Johnson, 119. The same construction was given in Aldrich v. Higgins, 16 Serg. & Rawle, 212, where the words were: "L. C. having a desire to enter into trade in a small way, we hereby offer ourselves as security to any gentleman who may feel disposed to give him credit not exceeding $700, or anything less, as he may think proper to contract;" in White v. Reed, 15 Connect. 457: "In any sum my son G. may become indebted to you, not exceeding $200, I will hold myself accountable;" in Anderson v. Blakely, 2 Watts & Serg. 237: "Mr. P. having informed me that he is making some purchases from you, and that you wish some reference, I would say that you might credit him with perfect safety, and that anything he might purchase from you I will see paid for," where the Court said: "There is more reason, perhaps, for giving a freer interpretation where the sum is, as in several of the cases, limited, because there the party intrenches himself within a certain amount, beyond which he can, in no case, be made liable. But when there is no restriction

in which, before the Act, the transaction would have been looked on as one of guarantee. For instance, if

struction put on these instruments, see Mayer v. Isaac, 6 M. & W. 605; Jenkins v. Reynolds, 3 B. & B. 14, 7 E. C. L. R.; Allan v.

of the amount, the guarantee should be carefully scanned, to see whether it justifies a party in the large construction contended for." And the same view was taken in Whitney v. Groot, 24 Wendell, 82, upon the words: "We consider I. V. good for all he may want of you, and we will sell him all he reasonably asks of us on credit, and we will indemnify the same." On the other hand, in Grant v. Risdal, 2 Harris & Johns. 186, "I will guarantee their engagements, should you think it necessary, for any transaction they may have with your house," was held to be a continuing guarantee till countermanded, but the reasons for the judgment are not reported. Instances of continuing guarantees will be found in Clark v. Burdett, 2 Hall, 197; Mussey v. Rayner, 22 Pick. 223; Bent v. Hartshorne, 1 Metcalf, 24; Douglass v. Reynolds, 7 Peters, 113; Lawrence v. M'Calmont, 2 Howard (U. S.) 426. As, for example, "Mr. R. is about to establish a store of books and stationery. He will commence on a limited scale, with the intention of enlarging the business next spring. He wishes to purchase school-books, &c., on a credit of four or six months, and paper, &c., on commission. For the faithful management of the business, and punctual fulfilment of contracts relating to it, the subscriber will hold himself responsible;" Mussy v. Rayner.

While it is undoubtedly true that each case must depend on the particular terms of the guarantee, aided by the attendant circumstances of the parties, it has been often suggested, if not held, that the language should be very strong to justify a court in holding a guarantee to be a continuing one, until notice given to the contrary; per Story, J., in Cremer v. Higginson, 1 Mason, 336; Nicholson v. Paget, 1 Crompt. & Meeson, 48; while, on the other hand, it has been more repeatedly held that the ordinary maxim, that the words of the instrument should be taken most strongly against the party using them, fully applied to guarantees; Mason v. Pritchard, 12 East, 227; Merle v. Wells, 2 Campbell, 413; Drummond v. Preestman, 12 Wheaton, 515; Douglass v. Reynolds, supra; Mayer v. Isaac, 6 Mees. & Welsby, 610, where the remarks in Nicholson v. Paget, supra, are disapproved.