[REFERENCES ARE TO PAGES.] St. Louis Dressed Beef & P. Co. v. Maryland Casualty Co., 201 U. Strouse v. American Credit Indemnity Co., 91 Md. 244. 555 Tausig v. Reid, 145 Ill. 486...... 172 Thompson v. Glover, 78 Ky. 193....... 187 T. M. Sinclair & Co. v. National Surety Co., 107 N. W. Rep. 184 (Iowa) 466 ...... Trustee of Schools v. Scheick, 119 Ill. 579. 120 Union Bank v. Coster's Executors, 3 N. Y. 203. 395 Union Mutual Life Ins. Co. v. Hanford, 143 U. S. 185.... 315 Weikle v. Minneapolis, St. P. & S. S. M. Ry. Co., 64 Minn. 296...... 13 263 Wendlandt v. Sohre, 37 Minn. 162.. 403 Wheeler v. Real Estate Title Ins. & Trust Co., 160 Pa. St. 408...... 582 White v. Boone, 71 Tex. 712..... 301 Wilcox v. Draper, 12 Nebraska 138.. 140 Willoughby v. Fidelity & Deposit Co., 16 Okl. 546. 476 Wilson v. Tebbetts, 29 Ark. 579..... 321 Winn v. Sanford, 148 Mass. 39. 135 CASES ON SURETYSHIP AND GUARANTY a. CHAPTER I. NATURE OF CONTRACT. Contracts of Suretyship and Guaranty are conditional or absolute agreements to answer for the debt, default or miscarriage of another. MERCHANTS' NAT. BANK. v. CITIZENS' STATE BANK. 1895. 93 Iowa 650; 61 N. W. Rep. 1065. Appeal from district court, Pottawattamie county; A. B. Thornell, Judge. Action at law on an alleged guaranty of a draft. At the conclusion of the evidence for the plaintiff, the court sustained a motion to direct the jury to return a verdict for the defendant. A verdict was returned as directed, and upon it a judgment in favor of the defendant for costs was rendered. The plaintiff appeals. Affirmed. ROBINSON, J. In December, 1889, B. Arentz was engaged at Ocala, Fla., in the business of buying and selling oranges, and O. W. Butts was in the wholesale fruit and commission business in Council Bluffs, Iowa. Butts had ordered of Arentz a car load of oranges, which was shipped from Ocala to Council Bluffs, the bill of lading being taken in the name of Arentz. He drew a draft on Butts for $560, the price of the oranges, payable to the plaintiff, a banking association organized under acts of congress, and doing business at Ocala, Fla., at 30 days after sight. Before the plaintiff took the draft, it required a guaranty of payment by a bank in Council Bluffs. Arentz notified Butts of the demand, and he induced the cashier of the defendant, a corporation of this state, to sign and send to the plaintiff a telegram, of which the following is a copy: "Council Bluffs, Iowa, Dec. 11, 1889. To Merchants' National Bank, Ocala, Fla.: Will guaranty Butts' draft for car oranges from B. Arentz. Citizens' State Bank. Chas. R. Hannan, Cashier." When the telegram was received, the plaintiff purchased the draft, taking the bill of lading, which was attached to it, and forwarded them for collection. The oranges arrived in Council Bluffs in bad order, and Butts refused to receive them, and refused to accept the draft. The defendant refused to pay the draft. Arentz is insolvent, and this action is brought against the bank on its guaranty. The answer of the defendant alleges that the guaranty was of the solvency and ability to pay of Butts; that the oranges were never delivered to him, and that he never accepted the draft, nor became a party to it; that the defendant is a corporation, and had no power to enter into a contract to guaranty the payment of a draft; and that there was no consideration for the guaranty. In a reply, the plaintiff alleged that it was usual and customary for the defendant and for banks, where it was doing business, to make such guaranties; that, at the time the one in question was made, an arrangement had been entered into between the defendant and Butts by which he was to hold the defendant harmless on the guaranty, and that it had money and other property in its possession which belonged to him, of a value exceeding its possible liability on the guaranty; that, by reason of these facts, the defendant is estopped to assert that the guaranty was executed without authority and without consideration. The appellant contends that the guaranty was authorized by the articles of incorporation of the defendant; that, if it was not, the plaintiff was a good-faith purchaser of the draft for value, and, as such, is entitled to protection, that, as the reply was not assailed, an estoppel must be regarded as sufficiently pleaded; that the court erred in excluding evidence which tended to prove an estoppel, and erred in taking the case from the jury. The appellant may be right in its claim in regard to these matters, and not be entitled to recover in this action. If it be conceded that the guaranty was valid, the question which remains to be determined is whether it created any liability under the facts which the evidence tends to establish. As has been stated, the draft was for a car load of oranges, which was never received by Butts. The bill of lading was taken in the name |