CHARLES S. TOBIN AND DAVID L. TOBIN, APPELLANTS,
v.
IOWA HOME MUTUAL CASUALTY COMPANY, APPELLEE
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Charles S. Tobin and David L. Tobin appealed a judgment holding them liable as guarantors of a contract. The trial court vacated the initial judgment, ordered a new trial on whether the guaranty was general or special, and upon retrial reinstated judgment, finding that even if the guaranty was special, it was assignable because the assignment occurred after a breach and cause of action had arisen.
The trial court properly held that even if the guaranty was special, it was assignable and enforceable by the plaintiff-assignee because the assignment occurred after breach, liability arose, and suit had been instituted. The distinction between general and special guaranty was therefore immaterial to liability.
“the assignment to which the defendants object, took place after a breach giving rise to liability, after a cause of action had arisen, and suit had been instituted thereon; and therefore the defendants cannot complain of the assignment”
Establishes the critical distinction that makes a special guaranty assignable when assignment occurs after breach and cause of action arises
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Join FLexlaw to unlock all legal intelligenceThe trial court entered judgment against Underwriters Management Corporation and Charles S. Tobin and David L. Tobin as guarantors. The trial court th…
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Trial of this cause without a jury resulted in a judgment for $60,151.37 against the appellants Underwriters Management Corporation and Charles S. Tobin and David L. Tobin. The basis for judgment against the individuals was as guarantors.
Thereafter the trial court vacated the judgment as to the individuals, and granted them a new trial with provision that “the issue of whether the guaranty was a general or special Guaranty shall be set for trial by this court on a date certain by subsequent order of this court.”
On retrial as thus provided for the court reinstated the judgment against all three defendants. That order, omitting the part restoring judgment against the defendants, was as follows:
“This cause having come on for final hearing before the court, without a jury on the issue of general or special guaranty pursuant to order setting aside judgment as to Charles S. Tobin and David L. Tobin, individually, dated June 3, 1965, the court having heard the testimony of witnesses on the 10th day of August, 1966; having considered the evidence offered by the parties; having examined the authorities cited by counsel hereto, and having heard argument by counsel for all parties hereto, and the court being otherwise duly and fully advised in the premises, finds against the defendants, Charles S. Tobin and David L. Tobin, on the issue of general or special guaranty, and in so doing the court specifically finds that it is immaterial in this cause whether or not the guaranty in question is a general or special guaranty. If .it is a general guaranty, it was freely assignable. If on the other hand it was a special guaranty, this court finds that the assignment to which the defendants object, took place after a breach giving rise to liability, after a cause of action had arisen, and suit had been instituted thereon; and therefore the defendants cannot complain of the assignment, * * * ”
Appellants contend that by granting a new trial on the stated issue the trial court fixed the law of the case to be that if it should be shown the guaranty was special, recovery could not be had by the plaintiff as assignee thereof (Lee v. Rubin, Fla.App.1960, 117 So.2d 230), and therefore the court erred in subsequently holding it was immaterial whether the guaranty was general or special. We reject that argument as unfounded. The basis for that holding, as explained in the trial court’s order, was that the assignment was shown to have been made “after a breach giving rise to the liability, after a cause of action had arisen and suit had been instituted thereon.” In imposing liability of the guarantors on that basis the trial court was not in error. Burkhardt v. Bank of America National Trust Savings Association, 127 Colo. 251, 256 P.2d 234, 41 A.L.R.2d 1207; 38 C.J.S., Guaranty § 42c, Special Guaranty.
*487Contentions presented by the appellants, (1) that the court erred in refusing to transfer the cause to equity and (2) that the evidence was insufficient to support the judgment, were considered in the light of the record and briefs and found to be without merit.
Affirmed.
Cases With Similar Vibessemantic neighbors from the corpus
Citator
Cited By
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NEW Holland, Inc. v. Trunk, 579 So. 2d 215 (Fla. 5th DCA 1991)…wever, has been recognized in Florida and other states, that a named creditor may, following breach of a special guaranty, assign his cause of action against the guarantor. Brunswick, 471 So. 2d at 618, citing Tobin v. Iowa Home Mutual Casualty Co., 209 So. 2d 485 (Fla. 3d DCA 1968) (upholding assignment made after breach giving rise to liability, after cause of action had accrued and legal action had been instituted); Burkhardt v. Bank of American National Trust & Savings Assoc., 127 Col. 251, 256 P. 2d 234…
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Brunswick Corp. v. Creel, 471 So. 2d 617 (Fla. 5th DCA 1985)…able. However, as noted above, this is a general rule and exceptions have been recognized such as that an obligee may, following breach of a special guaranty, assign his cause of action against the guarantor. Tobin v. Iowa Home Mutual Casualty Co., 209 So. 2d 485 (Fla. 3d DCA 1968); Burkhardt v. Bank of America Nat. Trust & Sav. Assoc., 127 Colo. 251, 256 P. 2d 234 (1953); In re Klink’s Estate, 310 Ill.App. 609, 35 N.E. 2d 684 (1941). See generally 38 C.J.S. Guaranty § 42(c). Indeed, at least one court has r…1 / 2
Authorities Cited
- Eve LEE and Morris Rosenberg v. Rubin, 117 So. 2d 230 (Fla. 2d DCA 1960)