Sorge Ice Cream & Dairy Co. v. Wahlgren

The issue presented by this appeal is whether plaintiff owed a legal duty to defendant to have applied on the $15,500 note a sufficient part of the $8,372.67 credit given the principal debtor Ehrhardt for the equipment transferred to plaintiff by the May 21, 1963, bill of sale so as to have extinguished defendant’s liability on the guaranty, rather than have applied most of such credit to other indebtedness of Ehrhardt.

It is a general rule that in the absence of an agreement or superior equity requiring application in the interest of a guarantor, the fact alone that a guarantor is liable for…