2 If several persons at the same time, acting together, sign a bond as surety for the principal, and one surety's name is afterwards erased by him without the knowledge of the others, they are released, although a statute provided that the bond must be approved before the principal entered upon his duties, and the alteration was made before the approval. Smith v. United States, 2 Wall. 219 (1864). And see Martin v. Thomas, 24 How. 315; Howe v. Peabody, 2 Gray, 556; Burchfield v. Moore, 3 El. & B. 683; 25 Eng. Law & Eq. 123. If a person gives to a landlord a guaranty for the rent of a farm occupied by a certain tenant, and the tenancy which existed at the time it was given is changed, this is a discharge of the guarantor. Tayleur v. Wildin, Law R. 3 Exch. 303 (1868). If goods have been sold and delivered upon a guaranty of the payment of the purchase-money, the guarantor is not discharged by the return of a portion of them by the vendee, with complaint of dissatisfaction, and a subsequent acceptance thereof by him under a new agreement by which his objections were waived, and a discount from the original price for all the goods was made; and in such case the vendee is entitled only to the time of credit fixed by the original contract, if no extension thereof has been granted, and the vendor, in an action against the guarantor, may properly declare on the original sale. Rice v. Filene, 6 Allen, 230 (1863).
3 Rowan v. The Sharps' Rifle Manuf. Co., 33 Conn. 1 (1865).
4 Twopenny v. Young, 5 Dow. & Ry. 259; s. c. 3 B. & C. 208; Ernes v. Widdowson, 4 C. & P. 151; Agricultural Bank v. Bishop, 6 Gray, 317 has been discharged when once liable, he make a promise to pay, with full knowledge of his discharge, this will revive his liability without any new consideration.1
§ 1128. An exception to the general rule that an extension of time for the principal debtor discharges the surety arises when the fact that one of the parties is a surety is unknown to the creditor. Therefore, where a promissory note is signed by several without distinction, and the holder, not being aware of the fact that some of the signers are sureties, extends the time of payment to others, the sureties are not discharged.2 But it would seem that such a state of facts could not arise in the case of a guaranty, except, perhaps, in the anomalous case of an indorsement of a bill or note by a stranger before an indorsement by the payee.3
§ 1129. If two joint debtors, both being principals, enter into a subsequent arrangement, inter se, but with the creditor's knowledge, whereby one becomes principal and the other surety as to each other, and the creditor subsequently takes a bill of exchange giving time to the principal sufficient to discharge the other had he originally been a surety, he will in like manner be discharged, although he become surety after the original contract was entered into.4
§ 1130. If there be any condition in the terms of the guaranty precedent to the liability of the guarantor,1 it must be strictly complied with, or the guarantor will be discharged.2 Thus, if it be necessary to make a demand upon the surety, he will not be liable until it is made;8 and if no time be stated within which it must be made, it must be made within a reasonable time. Thus, where by the terms of a guaranty, the guarantors agreed "to indorse any bill or bills which Mr. J. S. may give to Messrs. P. & Co., and Messrs. P. & Co. to allow £5 per cent on the amount of the said bills for the said guaranty," and certain bills were given by J. S. to P. & Co., which they held in their hands for seventeen months and ten days, without requesting an indorsement from the guarantors, and at the end of that time J. S. became a bankrupt, it was held that the guarantors were not bound; and Bayley, J. said, "The guaranty gives the plaintiff an option to have the indorsement or not; but it provides that they are not to pay the commission unless they do have the indorsement. Then the option ought to have been made in a reasonable time, and at any rate before that event occurred, of which, if the defendants had known, they would never have signed the guaranty." 4
(1856). As to the effect of a reservation of rights in Alabama, see Jemi-son v. Governor, 47 Ala. 390 (1872). If a plaintiff to whom a bond has been assigned by the defendant, the payment of which the defendant has guaranteed, takes another bond at a higher rate of interest from the obligor in the first bond as collateral to the original, and having a longer time to run, the receipt of interest on the said new bond does not release the defendant on his guaranty, although it appeared that the principal debtor became insolvent subsequent to the taking of the new bond. Bemsen v. Graves, 41 N. Y. 472 (1869).
1 Fowler v. Brooks, 13 N. H. 240; Woodman v. Eastman, 10 N. H. 359; The Bank v. Johnson, 9 Ala. 621; Thornton v. Wynn, 12 Wheat. 183; Creamer v. Perry, 17 Pick. 332; Rittenhouse v. Kemp, 37 Ind. 258 (1871).
2 Wilson v. Foot, 11 Met. 285. 3 Ante, § 1121.
4 Maingay v. Lewis, Irish Rep. 5 Com. Law, 229 (1870), in the Exchequer Chamber, a valuable case; Oakeley v. Pasheller, 10 Bligh (n. s.), 548.
§ 1131. There is one condition always implied in the contract of the guarantee, - that he will use all means in his power, which are reasonable and proper, to compel payment from the principal;1 and in an action upon a guaranty, he is always bound clearly to show that he has done his duty in this respect, or that it was useless.2 Where, therefore, a guaranty was made in these words, "April 10, 1834, - I warrant the within note good and collectible until the first day of July, 1834," the guarantee was held to be bound to show that he had done all that was diligent and proper in endeavoring to collect the note, and to show that the maker had not paid it, or was insolvent.3 So, also, where a note payable on demand was guarantied, and it appeared that the maker continued solvent for two years, during which time no attempt was made to collect it, the guarantor was held to be discharged.4 And where a promissory note or bill of exchange is guarantied, the guarantee must always show a demand and a notice of dishonor to all proper parties, and sometimes to the guarantor, although his name be not in the bill or note.5 But the same promptness in making a demand and notice is not necessary to charge a guarantor on a bill or note as to charge an indorser, and the guarantor must prove that he has suffered damage by the neglect to make a demand on the