Frederick Squire, Richard King, and John Squire, - Appellants; Mary Philippa Whitton, - Respondent
| Jurisdiction | England & Wales |
| Judgment Date | 14 February 1848 |
| Date | 14 February 1848 |
| Court | House of Lords |
English Reports Citation: 9 E.R. 785
House of Lords
Mews' Dig. v. 349. S.C. 12 Jur. 125. On point as to suretyship, see Archer v. Hudson, 1844, 7 Beav. 551; Lake v. Brutton, 1853, 18 Beav. 34; 8 De G. M. and G. 440; Small v. Currie, 1853, 2 Drew. 102.
Void Bond - Inoperative Agreement - Surety - Concealment.
SQUIRE V. WHITTON [1848] I H.L.C., 333 [333] FREDERICK SQUIRE, RICHARD KING, and JOHN SQUIRE,-Appellants; MARY PHILIPPA WHITTON,-Respondent [Feb. 11, 14, 1848]. [Mews' Dig. v. 349. S.C. 12 Jur. 125. On point as to suretyship, see Archer v. Hudson, 1844, 7 Beav. 551; Lake v. Brutton, 1853, 18 Beav. 34; 8 De G. M. and G. 440; Small v. Currie, 1853, 2 Drew. 102.] Void Bond-Inoperative Agreement-Surety-Concealment. A bond, void in law, may be enforced as an agreement in equity, subject to the effect of the equitable circumstances under which it was made. An instrument, purporting to be a bond, executed by the obligor, with blanks foi the name of the obligee, and therefore void in law, is inoperative in equity as an agreement, there being no second contracting party. A party joining as surety in a bond, ought to be informed of the nature of the obligation, name of the obligee, and the relation in which he stands to the principal obligor. M. induced W. to join his as surety in a bond for repayment of a loan, saying he only wanted time to realize securities, and he would hold her harmless. M. and S. being trustees of a fund, sold it, with consent of B., the cestui que trust, and thereby raised the loan for M., who informed W. that B. was the lender, but did not inform her how the loan was raised : Held that, B. not being in fact the lender, his personal representatives had no privity of contract with, nor equities against, W., and that, in consequence of the concealment from her of the real nature of the transaction, she was, in equity, altogether released from the bond. In the year 1833, Mr. William Morgan, a stock-broker in London, being suddenly required to provide a large sum of money, applied to his friends for pecuniary assistance, and, amongst others, to Mrs. Whitton, with whom he had been for many years on terms of intimate friendship, and was then co-executor with her of the will of her late husband. Mr. Morgan wrote to her the following letter : - [334] London, 7th August, 1833. " My dear friend,-On Friday Mrs. Morgan and myself went to Ramsgate, etc. But if any one regretted the loss of a friend, it is poor me, at this moment, at the loss of dear Mr. Whitton; for, to make short of my story, William (the writer's eldest son) in my absence, entered into a speculation most unaccountable, which I have to make good in seven days from the present; and in order to give time to realize other securities, may I ask the favour of you to join me in a bond for £10,000, which will give me time to make arrangements. You may depend upon it I will hold you harmless; but your answer must be by return of post, or it would be too late for my purpose. I shall take the first opportunity of seeing you, to state particulars ; in the meantime believe me, my dear friend, yours, etc., William Morgan." What answer, or whether any, was made to this letter did not appear; Mrs. Whitton being about seventy-six years of age, when she put in her answer to the bill, was not able to recollect (vide infra, p. 340); and Mr. Morgan in his answer said that by her particular desire he from time to time destroyed all the letters which he received from her. On the 9th August, 1833, a letter was written by the appellant John Squire, to Mr. Robert Farthing Beauchamp, who was then residing in Somersetshire, and was also an intimate friend of Mr. Morgan. That letter was not produced in the cause, but the purport of it appears, from Mr. Beauchamp's letter of the 11th of August, to have been to obtain the advance of £10,000 (vide infra, p. 337). Mr. Morgan, aware that the security of Mrs. Whitton was necessary to enable him to obtain the money, instructed Mr. Charles Morgan, one of his sons, then a [335] tflerk in the office of Mr. Gregson, the solicitor of Mrs. Whitton, to prepare a bond in the names of William Morgan and Mrs. Whitton, as the obligors for securing the said sum, and to leave blanks for the name of the obligee, and the rate of interest to be 785 I H.L.C., 336 SQUIRE V. WHITTON [1848] reserved. Mr. C. Morgan, pursuant to these instructions, prepared and engrossed a bond as follows : - " Know all men by these presents, that we, William Morgan, of Colneyhatch, in the county of Middlesex, esquire, and Mary Philippa Whitton, of Stonewall, in the parish of Chiddingstone, in the county of Kent, widow, are held and firmly bound to in the penal sum of £20,000 of good and lawful money of Great Britain, to be paid to the said , his certain attorney, executors, etc., for which payment, etc., we bind ourselves jointly, and each of us separately, etc., by these presents, sealed with our seals, dated this day of 1833. " Whereas the said , at the request of the said William Morgan, agreed to lend him the sum of £10,000, and upon the treaty of the said loan it was agreed that the repayment thereof should be secured by ihe joint and several bond of the above bounden William Morgan, and of Mary Philippi Whitton as his surety, in a sufficient penalty, at the time and in the manner mentioned in the condition hereunder written: Now, the condition of the above-written obliga tion is such, that if the said William Morgan and Mary Philippa Whitton, or either of them, their or either of their heirs, executors, or administrators, do and shall well and truly pay or cause to be paid unto the said , his executors, administrators, or assigns, the sum of £10,000 of lawful money of Great Britain, on or before the day of , which will be in the year 1834, with interest thereon, in the meantime, after the rate of for every £100 by the year, by equal half-yearly [336] payments, etc., then the above-written obligation shall be void, otherwise to be and remain in full force and virtue." This instrument was signed, sealed, etc., by " William Morgan " and " Mary P. Whitton," in the presence of " Charles Morgan, 18, Bedford-row, London," and " Samuel Tinkler, servant to Mrs. Whitton." On the 10th of August, 1833, Mr. William Morgan, with his son Charles, went to Mrs. Whitton'g, at Stonewall, taking with them the bond; and in the interview which he then had with her, apart from his son, he stated to her, as he alleged in his answer, that the object of his visit was to procure her execution of the bond, to enable him to borrow the £10,000, and his confident expectation that Mr. Beauchamp would lend him that sum upon her joining him in the bond, whereupon she expressed her willingness to join in such a bond. On the following morning, being Sunday, he had another interview in private with her,and she having again expressed her consent to join in the bond as a security to the person who should lend him the £10,000, Mr. Charles Morgan was then called into the room, and desired by his father to read aloud the engrossment of the bond preparatory to the same being executed, and he accordingly proceeded to do so in the presence and hearing of both; and on his coming to the blanks in the engrossment which had been left for the name of the obligee, he stated to Mrs. Whitton, that these blanks were for the name of the person who was to lend Mr. Morgan the £10,000, and would be filled up with his name when the money was advanced, or to that effect; and on his coming to the other blank, he stated to her that the same was for the rate of interest to be made payable on the bond, and would also be afterwards filled up. After he had read the whole of the engrossment, he explained to her the nature of the liability she would incur by executing the same, and that if the amount to be secured by the bond was not paid [337] by Mr. W. Morgan, she would be liable for the same; and he made use of this expression, " The effect of which is, that if my father cannot pay, you must." The bond was then executed with the blanks. On the 12th of August, 1833, Mr. Beauchamp's reply to the application made to him on the 9th, was. received in London by Mr. John Squire. It was as follows : - " Walford House, llth August, 1833. " My dear Squire,-Your letter of the 9th has completely upset me. I am indeed grieved beyond measure. What a distressing circumstance for poor Mr. and Mrs. Morgan, who deserve a better fate. You say that you and Rothschild have agreed to lend him each £5000, and I will with much pleasure do the same, provided you take care to see me perfectly secure. You say his friend Mrs. Whitton will join in a bond, or give a mortgage, which I doubt not is quite good; but you must ascertain if the 786 SQUIRE V. WHITTON [1848] I H.L.C., 338 property is at her own disposal and unencumbered, and if so, I would even advance the £10,000, provided he cannot procure it through any other channel, first, on bond, because you say there is not time to prepare the mortgage, and. afterwards on mortgage, at four and a half per cent. Recollect, I propose to lend stock, and not money, and for this reason, because I intend you to sell as much of the trust stock as you may require for this purpose. Of course the mortgage must be taken in your name and that of poor Morgan. Upon the first blush of the thing I had made up my mind to go to town, but I have had so much gout in my foot lately, that I do not feel quite equal to the journey, not being able to wear a boot. Do pray tell him this, and say how_very much both Mrs. Beauchamp and myself feel for him and Mrs. Morgan. Recollect the trust stock stands in the joint names of yourself and Morgan. As a proof that Mrs. Beauchamp with myself is anxious to assist them at this critical moment, she will add her sig-[338]-nature to this letter, acquiescing in the sale of part...
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