author: Duer, J.

text:
    Palmer, Special Receiver, &c. v. Lawrence and others.
    The obligation of actual payment is created, in all cases, by a subscription to a capital stock, unless the terms of the subscription are such as plainly to exclude it.
    Tins rule applies with peculiar force, to the associates of a banking company, under the general banking law.
    Where a subscriber to the capital stock of a banking company transiera to a purchaser the shares allotted to him without having paid the amount of his subscription, and the purchaser thereupon executes a bond and mortgage to the company to secure the payment of the nominal amount or par value of the shares, and the company accepts the same in satisfaction of the subscription ; the transaction is a novation — the substitution of one debtor for another.
    In all such cases, the original debt is as valid a consideration for the new promise, or security, as for that for w'hieh it is substituted ; and the transaction is equally as lawful as if the original subscriber had secured the payment of his subscription by his own bond and mortgage, instead of those of a stranger.
    Such a bond and mortgage may be enforced in the hands of an assignee.
    Although by the just construction of the general banking law, it is necessary that the whole capital of an association organized under its provisions should be paid, or secured to be paid, at the time of its being organized, as a condition precedent to the legal existence of such association ; yet the actual payment of the capital need not precede the making and filing of the certificate.
    The subscriptions of the associates for the capital stock will be deemed a compliance with the condition, as much as if each associate bad given Ms note or bond for the amount of his shares.

      A certificate made and filed for the purpose of organizing a banking association under the general banking law, if in conformity with the terms of that act, is evidence of the truth of the facts that it recites ; and is consequently evidence that the provisions of the statute have been complied with, and that the company was duly organized.
    From the time that such certificate is made and filed, and recorded, the association becomes a corporation, or quasi corporation, under the statute, possessing all the privileges, and competent to exercise all the powers that the statute confers. And from that time, every person is precluded from denying its legal or corporate existence in any suit or controversy whatever.
    A defendant who has contracted with a corporation de facto, will not be permitted to allege any defect in its organization, as affecting its capacity to contract or sue ; all such objections, if valid, are only available on behalf of the sovereign power of the state.
    An original associate in a banking association, cannot be permitted to impeach the certificate which he has subscribed. He cannot, therefore, deny the legal existence of the company, or the validity of its shares. If there is any fraud or illegality in the organization of the company, he, being a party to it, will not be allowed to found a defence upon it.
    And a person purchasing the stock of such original associate, and assuming his indebtedness to the company, upon his subscription, places himself in the same relation to the company, and will be estopped from disputing the validity of the debt upon any grounds that could not have been taken by the original associate himself.
    A party will not be permitted to rescind a contract, the fruits of which he retains, and can never be compelled to restore.
    Nor can a party impeach a title that he has himself transferred, until the invalidity of his own transfer has been established ; and this rule is as applicable to every transfer of personal property as to transfers of real estate.
    (Before Dues, Mason, and Campbell, J. J.)
    July 3, 5, 9, 7, 9 ;
    Sept. 29, 1849.
    The bill in this cause was filed by John J. Palmer, as special receiver of The North American Trust and Banting Company, to foreclose a mortgage executed by the defendants, Watson E. Lawrence and wife, to tbe company, on the 20th of Sept. 1838, to secure the payment of the sum of $36,000 in one year, with interest, payable semi-annually. William P. Ilallett, on the organization of The North American Trust and Banking Company, subscribed for and obtained 360 shares of the capital stock of the company, the par value of which was $36,000. Before he had paid to the company the amount of his subscription, he sold the stock to the defendant Lawrence, at par; and it was agreed between tbe parties, that for tbe purpose of securing the purchase money, the latter should execute a bond and mortgage to The North American Trust and Banking Company, for the amount, instead of making them payable to Hallett. The mortgage in question, was accordingly executed, and was accepted by the company in satisfaction of the debt owing by Hallett, upon his subscription; and he seas released from his liability. The mortgage came to the plaintiff by assignment from the officers of the company, made in pursuance of orders of the late court of chancery. The cause was originally commenced in the court of chancery, before the vice-chancellor of the first circuit; whence by the constitution of 1846, it was transferred to the supreme court, and from that court to this, by virtue of the act of March 24,1849. It was heard upon pleadings and proofs, as to the defendants Lawrence and wife, and Nicoll and wife; the other defendants having suffered the bill to be taken as confessed against them.

      Wm, Curtis Noyes, for the plaintiff.

      11. M. Western and 11. Scmdford, for the defendants.
   By the Court.

Duer, J.

We listened to the defence in this case, with great reluctance, and with serious doubts, whether without hearing the evidence, or the arguments of counsel, it was not our plain duty to reject and overrule it. This course, however, judges, who are conscious of their own liability to error, and aware of the hazard of trusting to first impressions, will rarely deem it expedient to follow, yet, in the present, case, it might have been safely followed : our first impressions, so far from having been weakened, have been strengthened and confirmed by subsequent reflection. The entire defence might justly have been overruled; it has not a semblance of equity, and we are now thoroughly convinced, just as little foundation , in law.

Upon the 20th of September, 1838, Wm. P. Hallett transferred to the defendant, Watson E. Lawrence, 360 shares of the capital stock of the North American Trust and Banking Company ; and, in consideration of this transfer, Lawrence, on the same clay, executed and delivered to the president of the company his bond and mortgage for $36,000, the nominal amount,, or par value of the shares. The object of the present suit is the foreclosure of this mortgage. Of its validity -when given, if the company had then a legal existence, we entertain no doubt. There is not a shadow of illegality in the transaction upon which it was founded. Hallett, as an original associate, was bound to pay to the company, when required, the nominal amount, or par value, of the shares for which he had subscribed. The law must now be considered as settled, that the obligation of actual payment is created in all cases by a subscription to a capital stock, unless the terms of the subscription are such as plainly to exclude it. — (Stanton v. Wilson, 2 Hill 153; Cross v. Jackson, 5 Hill 478; Valk v. Crandall, 1 Sand. Ch. R. 180; Farmers' and Mechanics’ Bank v. Jenks, 1 Metcalf 392; Herkimer Manufacturing Company v. Small, 21 Wend. 273; Hartford and New Haven Railroad Co. v. Kennedy, 12 Conn. R. 499.) And in a masterly opinion in which all the cases are reviewed, the late assistant vice-chancellor has very dearly shown, that the general rule applies with peculiar force to the associates of a banking company under the general law. (Sagory v. Dubois, 3 Sand. Ch. R. 466.) When the company permitted Ilallett to transfer his shares, they released him from his personal liability, and accepted the bond and mortgage of Lawrence in satisfaction of his debt. The transaction, in the technical language of the civil law, was a novation — the substitution of one debtor for another; and, in all such cases, the original debt is just as valid a consideration for the new promise or security as for that for which it is substituted. The transaction was just as lawful as if Ilallett, had secured the payment of the shares by bis own bond and mortgage instead of those of a stranger. The adequacy of the security is the only question that the company had to consider, its validity being just as unquestionable in the one case as the other.

It is evident that Lawrence, in purchasing these shares, had no intention to become a permanent stockholder in the company ; his object was, by the instrumentality of the shares, to raise the large sum of money which he seems to have required, and accordingly the shares were converted into cash with the least possible delay. lie transferred two hundred and seventy, on the very day on which he received them, and the residue within a few weeks thereafter. We must presume that he transferred them for value, and that this value was the sum which they represented ; in other words, that he sold the shares at par, and tins reasonable, and in the absence of contrary proof, necessary presumption, was neither contradicted by evidence nor denied in argument; we, therefore, regard it as certain, that the transaction, in the result, was nearly, if not quite as beneficial to Lawrence as a direct loan from the company, of the whole amount for which his mortgage was given. At any rate, the debt which the mortgage purports to secure, was equally just, and the obligation to pay it quite as binding in law and in conscience.

Upon what ground, then, is the payment of this debt resisted? Has Lawrence, in the event, sustained any injury or loss? Upon the ground that the shares which he sold had no legal existence or value, as is now alleged, has he been forced to take them back, and refund the whole, or any part, of the moneys which he received % Nothing of this kind is pretended. Has the mortgage, then, been satisfied, in whole or in part, by him or those claiming under him? No, not a dollar of the principal has been paid ; nor, for the last seven or eight years, a dollar of the interest: yet during this whole period, until, at the close of the last term, we appointed a receiver, he, and those claiming under him, have been allowed to retain the possession and receive the rents of the mortgaged property. Has Lawrence,, then, or any of the other defendants, any claims or demands against the company which form, or are supposed to form, a legal or equitable set-off? None whatever. Hence every defence, except upon grounds purely technical, seems to be excluded.

It might, however, have been supposed, from the language In which the defence was opened, that, instead of being strictly and purely technical, it was highly meritorious. A stupendous fraud upon the public and upon individuals, it was said, had been perpetrated, which the defendants, through their counsel, were bound to expose. Hie North American Trust and Banking Company, we were told, was conceived in sin, and brought forth in iniquity, and throughout, in its origin, progress, and result, was an enormous scheme of peculation, robbery, and plunder. ¥e were not told, however, how these facts, if true, had any bearing upon the case of the defendants; how, if true, they could furnish to them any excuse for seeking to repudíate a just debt, or any reason, or even pretext to us for exonerating them, or the mortgaged property, from its payment. If any fraud was meditated by the founders of this association, it was a fraud of which those who might intrust or advance their funds to the company, in good faith, its innocent stockholders and creditors, were meant to be the victims; and it is exactly to this fraud that the defendants, in resisting the payment of the mortgage, render themselves parties; and it is exactly this fraud that we are requested to sanction by a decree in their favor. In requiring us to declare that this mortgage is a worthless and void security, we are, in effect, required to declare that this is equally true in respect to all the securities now in the hands of the receivers of the company. We are required to declare that all its assets, now in their hands, are waste paper, and that no portion of them, no matter how obtained, or upon what consideration founded, is ' applicable to the payment of its debts. It is possible that it may be our duty as judges to make this declaration; but assuredly the reasons that can alone justify us in thinking or saying so, must not merely be cogent, but irresistible. Nothing but the pressure of a legal necessity, from which there is no possible escape, will induce us to say, that the two or three millions of debts which are owing to this company, are not to be applied to the payment of the still larger amount of debts which it owes. An enormous fraud will indeed have been committed, if the debtors are all to be released and the creditors to remain unpaid: but it must be remembered, that this fraud is only to be consummated by the action of the debtors themselves, and that if consummated, it is to them that the guilt will attach, and upon them that its reproach must fall; a truth that in the vehement denunciation to which we listened seems to have been forgotten.

Still the grounds upon which a decree for the sale of the mortgaged premises is opposed, may he such as to leave us no alternative, but to declare the invalidity of the mortgage, without any regard to the consequences to which our decision may lead. The objections, therefore, that have been relied on, must be stated and examined. Omitting those that -were overruled upon the hearing, such as the unconstitutionality of the General Banking Law, and some that we consider to have been virtually abandoned, we confine ourselves to tire positions upon which the leading counsel for the defendants ultimately placed the defence, and to the support of which his arguments were principally directed. They are the following : — ■

1. That it appears from the evidence that the capital mentioned in the certificate of the associates was not actually paid before the making and filing of their certificate; and that by the just construction of the General Banking Law, this antecedent payment of its capital was a condition precedent to the legal existence of the association; otherwise it could not become a corporation, or quasi corporation, under the law, nor possess any of the rights or privileges that the statute confers. Hence, as the shares of stock transferred to the defendant, Lawrence, had no legal existence or value, there was an entire failure of the consideration upon which his mortgage was founded ; and hence also the plaintiff has no locus standi in judicio, his capacity to sue being no greater than that of the pretended association which he represents.

2. Admitting that, when an association is formed, a subscription for its capital, instead of its actual payment, may justify its organization; in this case there -was no valid subscription. The actual subscription was nominal and fictitious, it being understood and agreed between the associates that no one of them should be bound to take any more of the shares for which he subscribed, than he might find it convenient to pay for, or secure to be paid ; in other words, it being agreed between them that the subscription should create no obligation of payment. Hence, that the defendant, who purchased his shares in good faith, in the belief that the entire capital had been paid in, or secured to be paid, was deceived and defrauded.

We shall hereafter examine these positions and state the reasons that compel us to reject them ; but there are various grounds upon whicb we might justly refuse to consider them at all, and to these we shall, in tbe first instance, briefly advert.

First. No such defence as these positions are supposed to involve, is set up in the answer. It is true, the answer alleges, that the company was never lawfully incorporated or organized under the statute; but the grounds upon which this allegation is rested, are widely different from those to which the evidence upon the hearing, and the arguments of counsel, were alone directed. The answer contains not a sentence or word, from which it can be inferred, that the necessity of the payment of the capital before the making and filing of the certificate of the associates, and the want of such payment, were meant to he relied on as a defence. On the contrary, the allegations of fraud, which the answer charges upon the associates, are, that instead of paying into the funds of the company, or securing to be paid, the amount of their subscriptions, as they were bound to do, they substituted bonds and mortgages, and other securities of little or no value, evading and defeating by these means the intent and object of the law. The answer, therefore, plainly admits, that a subscription to the capital stock of a banking association creates an obligation to pay the amount of the subscription to tbe company, when organized, and that the company, instead of demanding a payment in cash, may take adequate security for future payment: admissions directly inconsistent with the construction of the statute which we have been urged to adopt. As to the alleged agreement of the associates, that their subscription should impose upon them no personal liability, we have been unable to discover, in the answer, any averment, or even intimation of its existence.

Second. We are satisfied that the defendant, Lawrence, and those claiming under him, are estopped from denying the corporate existence of the company, with which he contracted; or, more properly, are concluded by the evidence of the fact which has been given. The certificate made and filed by the associates, was in exact conformity to the terms of the statute. It contained all the particulars that the law requires to be inserted; it was duly acknowledged and recorded in the county clerk’s office, and a copy duly filed in the office of the secretary of state, and the seventeenth section of the act declares that every such certificate, or copy, properly certified, may be used as evidence for and against the company in all courts and places whatever. Evidence of what \ Plainly, evidence of the truth of the facts that it recites; evidence, therefore, that the provisions of the act had been complied with, and that the company was duly organized. The eighteenth section enumerates and defines the powers, that every “ such association shall possess,” and the words, “ such association,” we can only understand as referring to every association of which a certificate, corresponding with the terms of the law, has been duly recorded and filed. Hence, from the time these acts are performed, the association becomes a corporation, or quasi corporation, under the statute, possessing all the privileges, and competent to exercise all the powers that the statute confers ; and from that time every individual is precluded from denying its legal or corporate existence in any suit or controversy whatever. If there were any illegality or fraud in its organization- — if, from inadvertence or design, any of the material facts set forth in the certificate were untrue — the association may undoubtedly be dissolved by the action of the sovereign power of the state; but as between the company and individuals, no evidence of such illegality or fraud can be given, in order to invalidate its certificate and disprove its legal existence or title; no individual who had dealt with the company is permitted to say that it had no authority to contract and no capacity to sue.

We deem it unnecessary to go into an examination of the numerous authorities that were cited by the plaintiff’s counsel, as applicable to these positions, but shall content ourselves with referring to a single case that binds us by its authority, and in its material circumstances is not distinguishable from tbe present. It is that of the Triton Insurance Company v. McFarlan (4 Denio, 392), which was first decided in thi% court, and removed by a writ* of error to the supreme court, where the judgment of this court in favor of the plaintiff was affirmed. The suit was upon a bond given by the defendant to the company, to secure the payment of certain shares of stock, and his sole defence was a denial of the corporate existence of the company. The company was not made a corporation by tbe mere passage of the law under which it was organized, but the act only incorporated those who should thereafter become stockholders, within a certain time, and upon certain conditions, and among these conditions was that of the payment of a certain sum upon each share, as subscribed. The act contained a further provision, that the company should not commence business until a deposition had been made by the president and secretary, that the capital had been paid or secured to be paid; and the evidence was, that this affidavit had been made and filed, and that from that time the company commenced its business, and had been in the constant exercise of its corporate powers. The defendant, in opposition to this evidence, had offered to prove that the sum required to be paid upon each share, at the time of subscription, had not in fact been paid, and insisted that this payment was a condition precedent, the breach of which rendered the charter a nullity.

The judges of the supreme court, however, were of a different opinion, and regarded the proof offered by the defendant as wholly inadmissible. They held that the state alone liad the right to inquire into any sins that might have been committed in bringing the corporate body into existence, but that its corporate existence, so far as third persons were concerned, was conclusively shown by the making and filing of the affidavit, and the subsequent user of its corporate powers. It is manifest that the making and filing of the certificate under the general banking law, were meant and must be construed to have the same effect, as the making and filing of the affidavit under the special act of incorporation to which this case refers, and hence no rational distinction can be stated, to exempt ns from the controlling authority of the decision.

The general rule, which is fairly deducible from all the cases on this subject, was stated and acted upon by this court, in Brouwer v. Appleby (1 Sand. Sup. C. R. 108.) It is, that a defendant who has contracted with a corporation de facto, is never permitted to allege any defect in its organization, as affecting its capacity to contract or sue; but that all such objections, if valid, are only available on behalf of the sovereign power of' the state. As every association under the general banking law is a corporation, or a quasi corporation, de facto, from the time that the certificate of the associates, if corresponding with the terms of the law, is recorded and filed, the application of the rule to the present case is seen, at once, to be decisive.

There is still another ground upon which the defence, without inquiry into the truth of the positions upon which it is founded, might be justly overruled. The entire argument of the defendant’s counsel proceeded on a very erroneous view of the nature of the transaction between Lawrence and the company. It was assumed that the transfer of the shares was the consideration of' the mortgage, and that it was from the company that Lawrence’s title to the shares was alone derived ; but such assuredly was not the fact. Ilallett was the owner of the shares, and it was from him alone that the title of Lawrence was, or could have been, derived. The transfer of the shares was the price paid by Ilallett to Lawrence, for assuming his debt to the company ; but the debt thus assumed, as between the company and Lawrence, was the true and sole, consideration of the mortgage, as certainly as if it had been executed by Ilallett himself. Hence the mortgage is only to be impeached by showing the insufficiency or illegality of this consideration ; that is, by disproving the existence of the debt. But it is exceedingly clear, that Ilallett could never have denied the existence of the debt, nor resisted its payment. He was an original associate, and could never have been permitted to impeach the certificate which he had subscribed ; he could not, therefore, have denied the legal existence of the company, or the validity of its shares. If there was any fraud or illegality in the organization of the company, it was a fraud or illegality to which he was a party, and upon which he never would have been allowed to found a defence. Lawrence, by assuming his debt, placed himself in the same relation to the company, and was estopped from disputing the validity of the debt upon any grounds that could not have been taken by Ilallett himself. It has been decided that a guarantor is not permitted to dispute the existence or the amount of the debt that he guarantees, where these have been conclusively admitted by the debtor, (Mann v. Eckford's Exec., 15 Wend. 502,) and the principle of the decision, it is evident, applies as well to a person who assumes absolutely the debt of another, as to him who engages collaterally for its payment.

We proceed now to the direct consideration of the objections that are relied on; not that it is at all necessary that these objections should be answered, in order to justify the decision that we propose to make, but that the same, or similar objections, may not be raised in any future case that we may be required to determine. The construction of the general banking law, upon which the first objection proceeds, namely, that the actual payment of the capital must precede the making and filing of the certificate, we have no difficulty in rejecting. It is as unreasonable as it is novel. It is not required by the terms of the statute, and is inconsistent with several of its provisions. The third subdivision of the fifteenth section declares, that the certificate of the associates “ shall specify the amount of the capital stock of such associationand it is upon these few words — this narrow foundation — that the ingenious argument of the defendant’s counsel was exclusively built; yet these words are so far from necessarily implying that the capital has been paid when the certificate is made, that it is only by a strained and violent interpretation that such a meaning can be attributed to them. The terms “such association” are used throughout the law, as designating, not the individuals who agree to form the association, but the association itself when formed; an association clothed with all the powers and attributes that the statute confers ; and we, therefore, cannot understand how such an association can have a capital before it exists. If the payment of its capital is to precede its existence, when, bow, and to whom is it to be paid? From whom is the authority to receive it to be derived? Whose property is it until the association is organized ? How is it to be secured in this interval ? When, how, and to whom is it to be paid over ? Not one of these questions is answered by the law as it stands, but we find it impossible to believe that any one of them would have been left unanswered, had the legislature intended that the payment of the entire capital should be a condition precedent to the existence of the association. We find it impossible to believe that such an intention, instead of being plainly and fully expressed, would have been left to be gathered, by a remote and doubtful implication. There are numerous acts of incorporation, many of which were quoted by the defendant’s counsel, as showing the general policy of the state, in which the payment of a portion of the capital is made a condition precedent to the existence of the corporation ; but, in every one of these acts, the persons to whom the payment is to be made are named or designated, and the time and mode of payment, and the disposition to be made of the moneys paid, are carefully prescribed ; nor can we doubt that specific regulations of such manifest propriety would have been found in the general banking law, had the legislature meant that the payment of the whole, or of any portion of the capital of an association, should precede its organization. We have said that the interpretation we reject is inconsistent with several provisions in the law; and it plainly is so. It is inconsistent with the provision in section 19th, that every person to whom shares of stock are transferred, shall succeed to the rights and liabilities of the original stockholder. It would be absurd to suppose that any liabilities are here meant, except such as directly relate to the shares themselves ; and if the shares have already been fully paid for, none sucb can exist. It is inconsistent with the provision in section 26th, that the semi-annual statement to be made to the comptroller shall specify the amount of'the capital paid in, or secured to be paid;" for if the whole capital has been paid, no portion can remain for which security is to be given. If the whole capital has been paid, and then loaned by the company, each loan is an investment of capital paid, not a security for its future payment ; and every such investment would appear, in the statement to the comptroller, among the debts due to the association, not as a part of its unpaid capital. We do not doubt that the whole capital of an association must be paid, or secured to be paid, when it is organized ; but it is secured to be paid, in the sense of the law, by force of the subscriptions of the associates, just as certainly as if each associate had given his note or bond for the amount of his shares. The security may not be adequate, but it exists; and of its adequacy the public has been wisely left to judge. This construction was given to the statute by the assistant vice-chancellor, in Sagory v. Dubois, and was the ground of his decision, that the defendant in that suit was liable to the receiver of the New York Banking Company, for the whole amount of the shares, for which, as an original associate, he had subscribed.

The second objection, that the associates had agreed not to be personally liable upon their subscriptions, is, if possible, still more untenable than that which we have considered. It admits of several distinct replies. First. The evidence, so far from proving the existence of such an agreement, leads, when fairly considered, to an opposite conclusion. Some of the associates, who were examined as witnesses, were assured that, should they be unable to pay for the shares which they subscribed, or secure their payment by their bonds and mortgages, other persons would, doubtless, be found, who would relieve them in whole, or in part, from their subscriptions; but not one of them was assured that, in no event, was he to be personally responsible; much less is there any proof that it was the understanding and agreement of all the associates that their subscriptions should only be binding at their election. Second. Had such an agreement been fully proved, it would not have affected the validity of the subscription, nor altered, in the slightest degree, the personal liability of any one of the associates. The agreement would have been void, but not the subscription. Not one of the associates, had the payment of his shares been demanded by suit, could have set up such an agreement as a defence. And lastly : Had the agreement been proved, and had it rendered invalid the subscription, the defendant, Lawrence, would have no ground of complaint. If deceived, he has not been damni-fied. He has derived, from the transaction with the company, all the benefits that he anticipated. His condition is exactly the same as it would have been had the facts he supposed to exist been actually true. He bought the shares to sell them; he has sold them, and received the avails; and it would be in the highest degree inequitable and unjust to permit him to rescind a contract, the fruits of which he retains, and can never be compelled to restore. He cannot impeach a title that he has himself transferred, until the invalidity of his own transfer has been established — a rule that, in our judgment, is just as applicable to every transfer of personal property as of real estate; and upon this single observation, had it been necessary or expedient, we might have rested our decree.

Upon the whole, the defence that has been set up, is as unsubstantial and shadowy, as it is inconsistent with good faith ; it is inadmissible in law and groundless in fact. Hence it is unnecessary to consider the other questions that were raised upon the argument, and which were only material as excluding a defence that might otherwise have been valid. We strongly incline to think that the effect of the written consent given by Lawrence to the assignment of his bond and mortgage to the comptroller, was to create an estoppel, of which the subsequent assignees from the company, who are represented by the- plaintiff, are entitled to avail themselves ; and it is also the inclination of our opinion, that the provision in the conveyance of the mortgaged premises to Effingham jST. Lawrence, rendering it subject to the payment of the mortgaged debt, although it created no such privity as could render the grantee personally liable to the plaintiff, is yet to be regarded as an admission of the validity of the mortgage, as a subsisting incumbrance, by which all the defendants are concluded. These are questions, however, of great interest and wide extent, and they deserve to be carefully examined, upon principle, and upon the authorities, before they are decided. Hence we are not to he considered as now deciding them.

The plaintiff is entitled to a decree, with costs, for the amount of the principal and interest, proved to be due upon the mortgage : and also to a decree against Watson E. Lawrence for whatever deficiency may arise upon the sale.


source: Caselaw Access Project

author: Oakley, Ch. J.

license: Public Domain

text:
    Caryl, survivor, &c. v. McElrath.
    Where a mutual insurance company was permitted to organize as a corporation, on the commissioners appointed for that purpose receiving applications for insurance to be approved by them to a certain amount, the premiums on the same being paid or secured ; it was held that the applications might be general, e. g. for $50,000, on merchandise from any seaport in the United States to Liverpool, and that they need not specify the particulars of any voyage or shipment; and the company having organized on such applications, it was held to have been duly organized.
    Whether one who has dealt with a company as a body corporate, can set up defects in its organization to show that it never became a corporation '? Quere,

    The president of an insurance company is the- proper officer to indorse negotiable securities payable to the company, in order to transfer them.
    In order to deprive the transferee from a moneyed corporation of the benefit of a negotiable security transferred, on the ground that it exceeded one thousand dollars in value, and was transferred without any previous resolution of the board of directors, it must be shown that he was not a purchaser of the security in good faith, or that he had notice of the fact that there was no such resolution of the board of directora. The burden of proving that he had notice, rests upon the party impeaching the transfer.
    (Before Oakley, Ch. J., and Vanderpoel and Sandford, J. J.)
    Sept. 19 ;
    Sept. 29, 1849.
    Assumpsit on a promissory note for $2,526, made by the defendant, payable to The Alliance Mutual Insurance Company, on order, at twelve months. The note was indorsed “ Alliance Mutual Insurance Company, Jas. D. P. Qgden, president.”
    The defendant read in evidence the charter of the company, and proved that the commissioners appointed to organize it, met on the 26th April, 1843, and received applications for insurance to the amount of $595,000, and notes for premiums thereon to $40,000; all of which the commissioners approved, and thereupon adopted a resolution to the effect, that the company was thereby declared to be organized according to the terms of the charter. They afterwards notified and superintended the election of trustees of the company. The company proceeded to carry on the business of insurance, and continued until 1841, when it failed, and a receiver was appointed in July of that year. The form of the application for insurance made to the commissioners was as follows:

      " Insurance is wanted by Brown, Brothers & Co., for account of whom it may concern,
    loss, if any, payable to them For $50,000 on merchandize and is insured at or
    from any seaport in the IJ. S. to Liverpool.
    by vessel or vessels as interest may appear
    Premium
    Binding President.”
    (Signed), “ Brown, Brothers & Co. applicant.
    “ New York, April 26, 1843.”
    These applications were, when received, entered by the commissioners in a book prepared for that purpose. It was admitted that the minutes of the board of trustees did not show any resolution authorizing the transfer or negotiation of the note in suit.
    A verdict was taken for the plaintiffs, subject to the opinion of the court.

      W, M. Kvarts, for the plaintiff,
    relied on Brouwer v. Appleby, 1 Sand. S. C. R. 168, and note; and Asp-inwall v. Meyer, Mss.

      W. Kent, for the defendant.
    1. The so called company was never legally organized ; and having never complied with the preliminary requisitions of its charter, viz. those contained in § 3, which required the commissioners therein named to receive applications for insurance, and approve those amounting to $500,000, the premiums on which have actually been paid, or secured to be paid, never had a legal existence, and could not, as a corporation, receive and transfer a negotiable promissory note. This was a condition precedent to the company becoming a body corporate. The applications for insurance were a mere nullity, and the notes given of no validity.

      2. The plaintiff does not stand in the position of a bona fide holder. He dealt with parties pretending to be a legal corporation, under a specific statute of the legislature. He is therefore chargeable with notice of the requirements of the statute, and bound to see that the pretended company has a legal existence before he deals with it. (Halstead v. The Mayor, &c. of Mew York, in the supreme court. May, 1849; 5 N. Y. Leg. Obs. 74.)
    3. The transfer of the note by J. I). P. Ogden, assuming to be president of the company, having been made without any resolution of the board of directors, was void by the statute. (1 R. S. 593, § 8; Ibid. 597, Art. 3.)

         Since reported in 2 Sand. S. C. R. 180.

   By the Court.

Oakley, Ch. J.

The third section of the act incorporating this company, (Laws of 1843, ch. 94,) made it the duty of the commissioners named in the act, to open a book to receive applications for insurances; and, after receiving such applications, to be approved by them, amounting to five hundred thousand dollars, the premium on which should have been actually paid in, or secured to be paid, they might close the book, and the company might be organized. They were then to superintend the first election of not less than twenty-four trustees of the company.

It is contended by the defendant that the company never became organized, because this third section of the statute was not complied with ; and that this was a condition precedent, without which the company could have no legal existence, and, therefore, it could not receive a note, or transfer it when received. It is said, the applications for insurance should have contained all that the insured furnishes for making a policy: that is, it should have set forth all the particulars of the risk intended to be insured against.

As to this point, the application for insurance is a very different thing from the contract of insurance to which it leads. It is a mere proposition, and only needs to state the objects on which insurance is sought, without specifying the particulars. With the applications, the parties gave their notes for a corresponding amount of premiums. They then had a right to demand regular policies of insurance for risks within their applications, and tlie company was bound to issue them. The propositions of this kind exceeded the sum limited in the charter, on all of which approved notes were given to secure the premiums. We think'the organ Ration of the company was complete in every respect.

If we liad doubted this, we should probably have held, that tlie company, having claimed to be organized, and having acted as a corporation, the question of its corporate existence is to he tested by the government, and not by individuals who have ■dealt with it as a valid corporation.

As to the objection made upon the form of the transfer of tlie note, the president of the company was, no doubt, tlie proper officer to indorse it and convert it into money. We so held virtually, last year, in the case of Aspinwall v. Meyer, on a note indorsed by the same president in behalf of this company.

There is nothing in the ease to show that the plaintiff ivas not a hot tú. fide purchaser without notice, within the meaning of the Section of the revised statutes, prohibiting certain transfers of securities by corporations, without a previous resolution of their boards of directors. (1 R. S. 591, § 8.) The burden of proving such notice is on the party alleging it. It is unnecessary, therefore, to consider the point made upon that provision.

Judgment for the plaintiff.

       See Palmer v. Yates, ante, page 137.


author: Sandford, J.

text:
    Hoard v. Garner.
    Where a person, for a valuable consideration, undertakes the collection of a bond and mortgage, and covenants in express terms “ to take proper means” to collect the amount secured to be paid by them, he is bound to see that such means are taken, by every person whom he employs to execute his covenant.
    The retaining of a competent solicitor is a proper step to be taken, and, as far as it goes, is a compliance with the contract. But the responsibility of the covenantor does not cease- there; and if the solicitor fail to pursue the proper means for collecting the securities, the covenantor is answerable for his default.
    What is the- proper measure of damages, in an action for the breach of such a covenant ? (See note (a) at the end of the case.) ⅛
    The amount of the bond and mortgage is its presumptive value. It belongs to the defendant to prove it to be a worthless or a doubtful security.
    (Before Oakley, Ch. J., and Sandford, J.)
    May 18;
    Sept. 29, 1849.
    This was an action of covenant upon an instrument in writing, in these words:
    “ Whereas, I have this day received from John W. Hoard, an assignment of a certain indenture of mortgage, bearing date the 81st day of October, 1843, made and executed by Charles W. Adams, and Henrietta his wife, to the said John W. Hoard, to secure the payment of two certain promisatory notes drawn by Charles W. Adams & Co., one in favor of Hugh Anchmeloss & Sons, or order, for $576 98, dated October 13th, 1843, and payable eight months after date, and the other in favor of Gamer & Co., or order, for $600 31, dated October 14th, 1843, and payable ninety days after date; and also to secure the payment of a certain bond or obligation bearing even date with the said indenture of mortgage conditioned for the payment of the sum of five hundred dollars to the said John W. Hoard, in one year from the date thereof, with interest; and whereas, I have surrendered and given up to the said John W. Hoard, the said note of $600 31, so drawn in favor of Garner & Co., as aforesaid. How, therefore, in consideration of the said assignment so made to me as aforesaid, and for the further consideration of one dollar to me in hand paid by the said John W. Hoard, I do hereby covenant and agree to and with the said John W. Hoard to take proper means to collect the amount, due and secured to be paid by the said indenture of mortgage so assigned as aforesaid, and to appropriate the amount which may be collected, after deducting all necessary expenses, as follows, viz.:—
    “ In the first place, to retain the amount of the said note so given to Garner & Co., as aforesaid, with interest thereon, from the time the said note became due and payable. In the second place, to pay unto the said Hugh Auchincloss & Sons, if there shall be sufficient for that purpose, the amount of the said promissory note so given to them as aforesaid, and the interest which may be due thereon ; and, lastly, if there shall be sufficient for that purpose, to pay unto the said John W. Hoard, the amount of the said bond or obligation so given to them as aforesaid, and the interest which may be due thereon.
    “ Given under my hand and seal this 31st January, 1844. “Thomas Gabnee.” (l. s.)
    The breadles averred were the omission of Garner to tafee proper means to collect, the bond and mortgage. The defendant traversed the breaches in various pleas, and set up several defences, on which issues were joined.
    The cause was tried before, in February, 1849.
    On the trial, it was proved that in September or October, 1844, the defendant employed Mr. O., a lawyer in good standing in the profession, as to skill and knowledge, to file a bill to foreclose the mortgage mentioned in the covenant. A bill of foreclosure was soon afterwards filed by him, against Adams and wife, and some, others. There was a delay of about three years, in the prosecution of that suit; which delay was the gravamen of the present suit. That delay was attempted to be accounted for as follows : Previous to filing his bill, Mr. C. had made proper searches, but the clerk of Richmond County, where the land was situated, in the certificate of search furnished by him, omitted a trust-deed, previously executed by Adams and wife, the mortgagors, dated Feb. 4,1842, and recorded. By this deed, the grantors conveyed all the real estate to which Mrs. Adams was entitled, as one of the children and heirs of Isaac Gubberlv, deceased, embracing the mortgaged premises, to John Q. -Day, in trust for her separate use, free from the control of her husband, and exempt, from his debts. It appeared that on the 4th of Sept. 1843, Alfred Adams was substituted as trustee, in tbe place of Day, and that on the 2d of April, 1844, Joseph G. Gilbert was substituted as trustee in the place of Adams. Mr. 0. testified, that at the time he commenced the foreclosure suit he had no notice or knowledge of this trust deed. But lie was informed that a Mr. Day and a Mr. Alfred Adams pretended to have some claim upon the mortgaged premises; and without knowing what their claim was, he made them parties defendants, and first ascertained the nature of their claim when the answer of C. W. Adams was put in, which was on the 10th of Dec. 1844. The answer of Day and Alfred Adams was served on the 8th. of March, 1845. It was substantially a disclaimer, stating that all their interest had been transferred to Joseph G. Gilbert. Mr. 0. also testified that after the answers had all come in, and the cause was in readiness for hearing, he entertained very great doubts whether the plaintiff could succeed; which doubt was founded on the trust-deed. That he was deliberating on that subject, and making some examinations for the purpose of seeing whether the trust-deed could be successfully attacked or not. That in March, 1845, Mrs. Adams, and Gilbert, the trustee, filed a bill, which was substantially a bill for a partition of the real estate of which her father died seized.
    That bill alleged the seizin and death of Isaac Cubberly, in 1841, leavingfive heirs, his will, and that it was proved in November, 1841, by William and James Cubberly, sons and executors of the testator. The trust deed of February, 1⅝42, was then stated ; also the recording thereof in June, 1842 ; then the substitution of trustees, and then the title of the complainant, whereby he claimed to be seized in fee, as trustee of Henrietta Adams, as tenant in common of and in one equal undivided fifth part of the land in question. The bill then set forth the bond and mortgage given by Adams and wife to Hoard, and the assignment by Hoard to Garner; and a subsequent mortgage given by Adams and wife to Seaver and Dunbar, and one still subsequent, given by them to Lee & Brewster. The bill then alleged that those three mortgages were not valid liens upon the land, or any part thereof.
    It prayed a reference to a master to inquire whether there were any liens or incumbrances on the land, and as to the several rights and interests of the parties interested ; and that the three mortgages might be decreed to be no lien or incum-brance upon the land ; and for a partition ; or, if that should be held impracticable, for a sale of the premises. The parties defendants were Adams and his wife; William and James Cubberly; tlie other tenants in common; Hoard, Gamer, Seaver & Dunbar, and Lee & Brewster. This bill, filed by Gilbert, was served on Mr. C. as solicitor for Garner, on the 3d of May. .No answer was put in by Mr. Goon behalf of Garner, there having been an understanding between him and the plaintiff’s solicitors, that it might be put in at any time. Mr. Sedgwick was soon after substituted as solicitor for Garner, and had the principal management of that suit. In June, 1845, the bill of foreclosure filed by Mr, G. on behalf of Garner, was dismissed, as to Day & Adams, and it then became necessary to amend the bill, and fi'e a supplemental bill, which was done in August, 1847. In the meantime, the mortgaged premises had been sold by the executors of Isaac Cubberly, deceased, in pursuance of a power contained in the will of the testator, to David J. Tysen. The supplemental hill set forth that sale, and alleged that the executors had in their hands a large sum of money, and certain securities, being the share of Mr. and Mrs. Adams of the purchase money. The bill prayed for an injunction against the executors, to prevent them from parting with the money and securities; and that the same might be delarecl to be covered by, and applicable to, Hoard’s mortgage, and that they might be so applied.
    William Austin, the solicitor for Adams and wife, in the foreclosure suit, testified, that no replication to either of these answers of Adams and wife, or Day and A. Adams, was filed, and the bill was dismissed for want of prosecution as to the defendants, Day and A. Adams, on the 14th of June, 1845, on a motion made by them for that purpose, which was not opposed. The next witness heard of the suit, was the substitution of Mr. Sedgwick in place of Mr. G. as solicitor, in the summer of 1846 or 1847. Nothing was clone until August, 1847. No proofs were ever taken, and the cause was never noticed for hearing, except at January Term, 1849, and then, for the first time. It was in readiness for hearing on bill and answer as to C. W. Adams and wife, and jjro confesso as to all the other defendants, in the summer of 1845.
    It appeared from the testimony of Mr. J. S. Sandford and Mr. David A. Fowler that the state of the calendars and the amount and course of business in the courts, at the time the foreclosure suit was commenced, and while it was pending, was such that the foreclosure suit might probably have been heard within a year from the time of being placed upon the calendar. That a cause standing for hearing on bill and answer of the date of December 10, 1844, would have been No. 3, on the 3d class of causes for April term, 1845, and Ho. 24 from the top of the calendar; and a cause, of the date of March 8, 1845, would have stood So, 7 on the third class. That, by filing a replication in the foreclosure suit commenced by Garner, the plaintiff’s solicitor might have entitled himself to put the cause on the calendar of the Assistant Vice-Chancellor, which would have expedited the cause.
    The plaintiff paid the Auchineloss note with interest, on the 3d of June, 1846.
    The plaintiff having rested his case, the defendant’s counsel moved for a nonsuit, on the grounds: 1. By the employment of a competent and skilful lawyer to foreclose the mortgage, the defendant’s covenant was performed and satisfied. Besides, it does not appear, in point of fact, but that the suit was properly conducted. 2. The trust deeds set out in the answer of Adams and wife, are a complete bar to this suit. 3. The defendant might himself have pursued the litigation, or taken steps to hasten the one already begun. 4. If not, it is insisted that the mortgage is still good and collectable, and can be collected, and the plaintiff has sustained no damage.
    The motion was denied, and the defendant’s counsel excepted.
    The defendant’s counsel then recalled as a witness William Austin, who testified as follows : — “ I was complainant’s solicitor in the suit of Gilbert. Hoard did not appear, and the bill ivas taken as confessed against him for want of appearance. Garner did not answer. The second and third mortgagees answered; replications were filed to these answers in November, 1845. Order to close proofs was entered February 1, 1846. Subsequently, James and William Cubberly, the executors, applied to open the order pro confesso against them, and to dissolve the injunction. This was in August or September, 1846. I gave them a stipulation to take the same objection as if they had demurred. The injunction was dissolved on their motion by Vice Chancellor McCoun, June 26, 1846, The bill was dismissed, on the complainant’s own motion, with costs. Upon the different motions that had been made, I became satisfied, that it was very doubtful whether the bill would be sustained or not.”
    Theodoee Sedgwick, for the defendant,
    testified, “ I became acquainted with this litigation in July, 1846. Previously Charles E. Eacey and wife filed a bill, against these parties, the Adams’s and Cubberlys ; Mrs. Eacey was one of the heirs of Isaac Cubberly. The subpoena to answer served on Garner, was handed to me a few days prior to my being substituted in the two other suits. He desired me, at the same time, to take charge of the other litigation. The three suits then remained in my charge. The foreclosure suit is still going on, the others have been dismissed. The whole amount of the claim was small, compared wdth the litigation. There were three chancery suits when the matter came into my hands, all involving questions of more or less difficulty. It appeared to me, the whole fund would be used up in expenses, if they all proceeded. I thought it best to make as little expense as possible, until some decision was made in the suit brought by Mr. Gilbert, which, I supposed, would relieve us from some of the difficulties. I thought also, there was doubt of the result of the foreclosure. The settlement of Mrs. Adams involved a very nice question of the statute of trusts. In view of the difficulty and expense, I refrained from making any further expenses in the foreclosure and Eacey suits, until the Gilbert bill was dismissed in 1841. The bill filed by Eacey was a bill with a double aspect. One branch of it was to compel David I. Tysen to complete a sale which had been made to him by the executors. The prayer of the bill was among other things to pay Mrs. Adams’ share into court for the benefit of the persons entitled thereto. It was demurred to by Tysen, and dismissed on a hearing, by Vice Chancellor Sand-ford.” On cross-examination the witness testified, that the suit instituted by Eacey did not dispute the mortgage, and was not in conflict with, or adverse to the foreclosure. He knew nothing of the existence of the covenant between these parties, until shortly before this suit was brought.

      Raymond M. Tysen, for the plaintiff,
    testified, that he knew of the sale by the executors of Isaac Cubberly to David I, Tysen. The price paid by the latter was $9200.
    The testimony was here closed, and, upon the suggestion of the court, a verdict taken for the plaintiff for $2000, by consent, subject to the opinion of the court on the whole case, and subject to adjustment, with liberty to either party to turn the case into a bill of exceptions.

      C. II Smith, for the plaintiff.
    I. There has been a breach of covenant. (1.) By gross delay and neglect in the prosecution of the foreclosure. So suit, was commenced till October, 1844. At every term from January, 1845, to July, 1847, the cause might have been reached and heard. Mr. Sandford testifies that it took him but a year to collect a severely litigated mortgage. In Sept. 1848, thirteen months after this suit was brought, Garner’s solicitor started afresh, by amending his hill and by filing a supplemental bill, all which was known to be necessary nearly four years before. The property sold for $9,200, one fifth of this is $1,850, a margin of some $150 over* the mortgage; enough to cover interest and expenses had due diligence been used. A prompt suit in Feb. 1844, for the part then due, would have secured an early decree and an abundant fund.
    The advice of counsel was sought to be made conclusive on the plaintiff as a justification of the delay. Neither solicitor was made acquainted, by the defendant, with the obligation he was under to Hoard. This was expressly so as to Mr. Sedgwick. Had he given them instructions, or imparted this information, the delay would either not have occurred or he would now have a claim over on them. But the defendant is liable for their default. (Merchant’s -Battle v. Allen, 22 "Wen. 228.)
    (2.) Gilbert’s suit was no excuse for the delay. It had surely been right to bring the foreclosure to a hearing. It was at least doubtful to wait twenty-seven months without compulsion. Gilbert’s suit was not put in a condition to be expedited; for Gamer put in no answer. lie should at least have demurred. (3.) This covenant did not constitute the defendant a mere representative agent, “ It looked to the thing itself to be done. It was not a mere delegation of a trust power.” {Allen v. Merch. Bk.. 22 Wen. 233-4.) Even in that view there is a breach. {Schultz v. Pulvcr, 11 Wen. 361.) The obligation is to take the ordinary mode by a suit brought in due time, and prosecuted with due diligence to a decree. (Story on Agency, § 199, 200, 208.) It is not the “ ordinary mode” of foreclosing a mortgage, to wait till other suits are decided, to partition other people’s land or cancel other people’s mortgages. Thus when, in August, 1847, this suit was brought, the defendant had literally progressed not one step towards collection; for he started afresh in Sept, 1848.
    II. The damages are the value of the bond and mortgage, including the personal liability of Adams ; which value is,grrim& facie, the nominal value. {Le Guen v. Gouverneur, 1 Johns. Cas. 437, note; Kortright v. Commercial Bank, 20 Wen. 91, 22 Id. 348 ; Allen v. Suydani, 17 Wen. 370, 20 Id. 321; Shultz v. Pulvcr, 11 Wen. 361; Ingalls v. Lord, 1 Cow. 240.) And in analogy to actions against sheriffs for neglect to execute process. (Bank of Rome v. Gwrtiss, 1 Hill 275 ; PardeeY. Robertson. 6 Id. 551; Patterson v. Westervdt, 17 Wen, 543 ; 1 J. R. 215 ; 2 Id. 454; 7 Id. 189; 6 Id. 270; 2 Mass. 526; 2 Bay. 395; 2 Day 195.) See Love joy v. Hutchins, 23 Maine Rep. 272, where it is held that no deduction can be made for expenses which would have taken place had no breach occurred. The attempt to impeach the mortgage is unsuccessful. The mortgage is good. This deed, is a trust of personal property. (Kane v. Golf 7 Pal. p. 521; 24 Wen. 641; 2 Kent, Comm. 352.) Adams and wife held the land subject to a power to sell, which power was imperative. (R. S. 717, § 2, 721, § 45, 723, § 56, 727, § 96.) It was an “ interest” in land as defined by 2 R. S. 73, § 6.) This trust-deed was void as against, the mortgage, under 2 R. S. 68, §§ 1 to 4, 72, § 1. (6 Hill 438, 4 Id, 424) ‘ And as a trust of personal property, it is within § 1, p. 70. If it is a trust of real estate, it is void under § 55 of the statute of trusts. (1R. S. p. 723.) Besides the mortgage is valid under the trust-deed. Mrs. Adams had all the powers of a feme sole, and could alien and encumber it at pleasure. The consideration, moreover, is a present one, not an old debt. (Meth. Epis. Church v. Jaques, 3 I. C. E. 86, and cases cited ; 17 J. R. 548 ; North Am. Coal Co. v. Dyett, 7 Pai. 14, 20 Wen. 573 ; Gardner v. Gardner, Id. 116, 22 Id. 528; 2 Kent, § 28, 161-7, and notes ; 2 Story, Eq. Jur. § 1399, and seq.; Leaycraft v. Hadden, 3 Green Ch. R. 512.) *

      T. Sedgwick, for the defendant.
    I. The covenant sired on was “ to take proper means to collect the amount secured by the mortgaged The first question is, what, under the circumstances, are “ proper means ?” 'We insist that the employment of a competent professional gentleman, in good standing, was itself a satisfaction of the covenant; and it is absurd to suppose that Mr. Garner intended to assume the conduct or the responsibility of the litigation, or to guarantee Mr. Hoard against legal errors. From the nature of the case, it was impossible for Mr. Gamer to give Mr. C. any specific instructions. All he could possibly do was to give him general directions to collect the amount due on the mortgage.
    II. In point of fact the “ means’- employed by Mr. C. were “ proper.” He exercised his judgment in the matter, and was guilty of no oversight; but on a view of the whole case, thought it inexpedient to proceed with the first suit, till the other was decided. If the covenant had been by Mr. C. himself, and if he had erred in judgment, still he would not be responsible.
    III. Rut the “ means” were not merely proper within the meaning of the covenant. Mr. C.’s course was the true one, and any other would have been a sacrifice of the interests of his clients. The question involved was of very doubtful issue.
    IY. If there were any unnecessary delay, Mr. Hoard, who was a party defendant, should have acted himself. He might have moved to dismiss the bill for want of prosecution.
    Y. The plaintiff has sustained no damage. Either the mortgage was good or bad. If bad, it could not be collected; if good, it can still be collected. Either way the plaintiff has lost nothing.
   By the Court.

Sandford, J.

Whatever might have been our view of the effect of the defendant’s covenant, if it had been an open question, we are required by the authority of the case of Allen v. The Merchants' Bank, (22 Wend. 215,) in the court for the correction of errors, to give our judgment for the plaintiff. It was there settled that, on the deposit of a bill of exchange with a banker residing here, for collection in another state where it was payable, the banker was liable to the holder for any neglect or omission of duty, in respect of such collection, on the part of his agent, or the notary employed by him, in the foreign state.

The principle established was, that the implied contract of the banker was an understanding to do the thing itself, and was not the delegation of an agent or attorney to procure the thing to be done. That the contract looked mainly to the thing to be done, and his undertaking was for the due use of all proper means for its performance ; and it was not a contract only for the immediate services of the agent, and his acting faithfully as the representative of his principal. That in the latter case, the responsibility ceases with the limits of the personal services undertaken ; in the other, it extends to cover all the necessary and proper means for the accomplishment of the object, by whomsoever used or employed.

In the case at bar, the defendant for a valuable consideration undertook the collection of a bond and mortgage. He covenanted in express terms “ to take proper means” to collect the amount secured to be paid by them ; and he is therefore clearly responsible that such means should be taken, by every person whom he employed, to execute his covenant. The retainer of a competent solicitor was undoubtedly a proper step to be taken, and as far as it went, was a compliance with the contract. But the responsibility did not cease there ; and if the solicitor failed to pursue the proper means for collecting the securities, the defendant must answer for his default.

It was contended that proper means were taken in this case ; that the long delay which occurred was the result of no oversight on the part of the solicitor employed; in his judgment it was inexpedient to proceed tinder the circumstances, and his course was the true one.

The good faith of the solicitor is not impeached. This, however, did not satisfy the covenant; nor did the exercise of his judgment, if that judgment were wrong, and caused unreasonable delay. We have considered the question with more than usual care and deliberation, and we cannot resist the conclusion, that the course pursued by the solicitor was unwise, and in respect of the defendant’s duty to Hoard, was entirely unwarrantable. No good reason is shown why the foreclosure of the mortgage was not commenced immediately after the defendant received it. Passing by the nine months thus lost before proceedings were instituted, in December, 1844, the solicitor became fully informed of all the difficulties in the case, by the answer of Adams and wife. He should then have brought Mrs, Adams’ trustee before the court at once, by an amendment of his bill. If this course had been pursued, *the bill afterwards filed by Mrs. A. and her trustee would never have been exhibited, or, if exhibited, it would have been no more than a cross bill in the foreclosure suit, disposable either summarily, by a demurrer, or more deliberately, by being carried forward with the original -suit. Whether Mrs. A.’s bill bad been filed or withheld, if the original suit had been pressed on with ordinary diligence, after the receipt of the answer of Adams and wife, there is no doubt that it would have been brought to a hearing, and a decision obtained, before 1846. Even after the bill of Mrs. A. and her trustee was exhibited, the defendant could have expedited either the one suit or the other, and brought the matter toa conclusion. Rut he did neither. He was entirely passive from December, 1844, until after this suit was commenced, a period of more than two years and a half. It is said the marriage settlement of Mrs. Adams presented a doubtful and difficult question. If it did, there was the more reason for urging on the suit, because a greater delay would be inevitable, if the suit were to be litigated.

Without dwelling upon the subject, it suffices to say, that proper means were not taken by or in behalf of the defendant, to collect the bond and mortgage, and he is liable for a breach of his covenant.

The inquiry remains, what is the extent of that liability ? It is said, on his part, that the mortgage was either good or bad: if it were bad, he could collect nothing; if it were good, the plaintiff has lost nothing. This, we think, is not sound. The mortgage, however good it may be, avails the plaintiff’ nothing, so long as the defendant retains it, and neglects to collect it. He sustained his damages, (if it were good,) two or three years since, when he was entitled to receive his share of the security, and received nothing. His injury is the same as if he had held the defendant’s note, payable at that time, and it had remained unpaid.

As to the amount of damages; the amount of the bond and mortgage is its presumptive value. It belongs to the defendant to prove it to be a doubtful or a worthless security. (Ingalls v. Lord, 1 Cowen 240; Allen v. Suydam, 17 Wend. 370; S. C. 20 Ibid. 321; Patterson v. Westervelt, 17 Ibid. 543.) No attempt was made to impeach the value of the security, in respect either of the adequacy of the mortgaged premises at the time of the transfer, or the solvency of the obligor in the bond ; but it was contended that the premises were vested in Mrs. Adams’s trustee, and the mortgage * never became a lien upon them. The obligor’s responsibility would still remain, if this were all true. It was proved that the lands mortgaged had been sold under the power in the will of Mrs. A.’s father, and produced the gross sum of $1850, which, after the commissions and expenses were deducted, would not have paid the mortgage and the interest which had accrued, when this suit was commenced.

Then, as to the validity of the mortgage as a lien. The bond was equitably converted into personalty, by the will of Mrs. Adams’s father; and as such, it appears to us was wholly within her control by the provisions of the settlement, and was, by her act in mortgaging it, subjected to the payment of this debt. (North American Coal Co. v. Dyett, 7 Paige 14; S. C. 24 Wend. 573; Gardner v. Gardner, 7 Paige 116; S. C. 22 Wend. 528; Leaycraft v. Hadden, 3 Green’s Ch. R. 512.) We need not, however, decide this point. The damages are subject to adjustment; and in ascertaining tie amount, (which will he done at chambers,) proof may be made, of what was stated at the argument, that the defence to the mortgage on the marriage settlement, had been abandoned.

Another consideration will arise on the adjustment. It is obvious that if the foreclosure had been pressed to a sale prior to 1846, the undivided fifth of the farm, sold by itself, and subject to the power of sale vested in the executors of Mrs. A.’s father, would not have produced as much as it has done by the sale of the entire farm under the power. Referring this and the details of the damages to future adjustment, we wall at this time order judgment for the plaintiff for the amount thereby to be ascertained.

         After hearing counsel, and receiving some evidence by consent, the court adjusted the damages as follows :
      Assuming the whole farm to have been worth as much in 1845, as when sold in April, 1846.
      A reasonable time to have collected the mortgage and sold the premises would have brought the collection to, say, Oct. 1845.
      Value of whole farm, then, say, ....... $9250 00
      8750 00 1750 00 One fifth, is Of which, allow for executor’s expenses, &c., and commissions, which, whether sold on foreclosure or not, would hav-¾ finally been a charge on the proceeds; also auction fees, advertising, &c., &c. . . . ■> $ 500 00
      (The share actually realized, as Mr. Sedgwick says, $1736 80) If it had been, sold in 1845, undivided, and subject to the power of sale in the executors, there being no one creditor with sufficient interest in the matter to buy it in, it would have brought, say 10 per cent less, 1575 00
      From this, deduct cost of foreclosure on bill and answer, say, 175 00 Counsel fees, #75 to #100 . . . . ■ . 75 00 Master’s bill on sale, . . . . . . . 50 00 (Mortgagor insolvent, &e.)... $ 200 00 Net proceeds, in October, 1845, 1375 00
      Gamer was first to retain the amount of his own note, viz, $600 31 And interest from Jan. 15, 1844. Int. 1 year 9 months, 73 53 ■-- $ 673 84 Bal. for Auchineloss & Hoard, 701 16

        Brought forward, . . . . 701 16 Int. from Oct. 15, 1845, to Oct. 27, 1849 — 4 years 12 days, . . 197 94 Amount, on this computation, 899 10
      If we take the actual result of the executor’s sale, and make no allow- - anee for depreciation on sale of an undivided interest, the matter will stand thus:
      Proceeds 1736 80 Exp. of foreclosure, say #200 to [ XXX XX XXXX ] 80 Gamer’s debt, 15 Oct. 1845 673 84 837 96 Int. 4 years and 12 days, ......... 236 55 Judgment for plaintiffs for . #1074 51
      As to collateral suit of Gilbert, it probably would not have existed, if the foreclosure had been diligently prosecuted. The other suit unimportant.


text:
    Hawes, Gray & Co. v. Lawrence & Hicks.
    In a contract for the sale of goods, on board a merchant ship, to arrive, the words “sailed on or about the 15th March” were held not to be a condition precedent, or to import a stipulation or a warranty that the ship sailed at the time expressed.

      Held also, that if the representation thereby made, were made in good faith, and the vessel sailed on the 26th March, the difference in time did not authorize the buyer to refuse to receive the goods.
    Evidence of commercial usage is not admissible to prove that sailing on the 26th, could not be a compliance with a clause in a contract for the sale of oil to arrive, which expressed that she had “ sailed on or about the 15th of March.”
    Evidence is not admissible, to prove that there was a spring and fall trade in oil, that the spring trade ended before the oil sold arrived, and keeping it over summer would waste and deteriorate it, in order to ascertain whether such a clause is a warranty, or is a material representation on which the parties relied, making an essential part of the contract.
    On a sale of about 6,000 gallons of oil, to arrive by a specified ship, it turned out that the invoice shipped contained 7,211 gallons. Held, that an offer to deliver 6,000 gallons, or to deliver the whole, charging for 6,000 gallons at the contract price, and for the residue at the market price (which was less,) was a good tender on. the part of the seller, in fulfilment of the contract.

      Held also, that a parol offer to this effect might be proved, although there were written tenders, in all of which the offer was made of the entire invoice at the contract price.
    (Before Oakley, Ch, J., and VariDEKrOEL and Sandfokd, J. J.)
    Sept. 21, 22 ;
    Sept. 29, 1849.
    This was an action of assumpsit, brought to recover damages for refusing to accept a certain quantity of linseed oil, to arrive, and imported in the ship Marcia, from London to Boston, and thence sent coastwise to New York, in the month of June, 1847, and sold by the plaintiffs to the defendants, through a broker by a bought and sold note.
    The cause was tried before Sandfoed, J., in December, 1848.
    The plaintiffs, who resided at Boston, proved that they authorized Henry M. Harding, a broker in New York, by letter, to sell the oil in question, to arrive.
    The letter was dated March 22, 1847, and stated that they had five or six thousand gallons English linseed oil on board the Marcia, then on the way from London to Boston; and that the vessel was to have sailed from London on the 15th of March.
    In compliance with this authority, Harding .sold the oil to the defendants by a broker’s note, of which he gave one to the buyer and one to the seller. The notes were as follows :
    “ Sold for account of Messrs. Hawes, Gray & Co., Boston.
    “To Messrs. Lawrence & Hicks, New York.
    “ About 6,000 gallons prime English linseed oil, in usual sized packages, to arrive per Marcia, from London, sailed on or about the 15th March ult., at 72c. per gallon, cash, deliverable in Boston or New York, at the option of the buyers ; the vessel being bound to the port of Boston. IIeney M. Haeding,
    “ Broker, 73 Wall st.
    “ New York, April 3d, 1847.”
    The vessel arrived at Boston on the 15th of May. The broker, on the 16th or 17th, communicated the arrival of the oil to the defendants, and asked them to decide whether they would take the oil deliverable in Boston or New York. They said they would not decide that day ; but instructed him to inquire what day the Marcia sailed from London. On the 18th they requested him to order the oil to New York, by the first packet, provided it was of prime quality, and the Marcia did not sail after the 25th. The oil arrived in New York on the 5th of June. The defendants were at once notified that the oil had arrived. Nothing being heard from them, and two days afterwards, the oil having come out of the vessel, the broker on the 7th June gave them notice in writing, as follows :
    “ New York, June 7, 1847.
    “ Messrs. Laweence & Hicks :
    “ Gents, — I beg to inform you in behalf of Messrs. Hawes, Gray & Co., Boston, that their contract with you is now fulfilled, and that the 57 casks linseed oil is landed from the schooner Abbott Lawrence, and now on the dock at the foot of Maiden, lane. Your immediate attention to the receipt of the same is respectfully solicited, as in the event of not so doing I shall be compelled (agreeable to my instructions, and which you have already been advised of',) to cause the same to he advertised forthwith to be sold at public auction for account of whom it may concern.”
    They did not accept the oil; it was advertised two days, and sold at auction, on 9th June. It was prime quality, in prime order, and in the usual size packages. At the sale, thirty casks sold at seventy-one cents, and twenty-seven casks sold at seventy cents per gallon. The net proceeds of the sale were $4,265 81. A bill of the deficiency, amounting to $926 11, was presented to the defendants on the 12th of June. The whole quantity of oil was 7,211 gallons.
    It further appeared that the defendants declined to receive the oil, on the ground that the Marcia did not sail from London till the 26th of March, as soon as they were informed of that fact. Previous to the arrival of the oil, the broker, on sending to the defendants the bill of lading of the oil as shipped from Boston, offered verbally to deliver to the defendants six thousand gallons of it, or to deliver to them the whole invoice, they taking 6,000 gallons at the contract price, and the surplus at the market price; both of which offers they declined. In all the written offers, the whole invoice of the oil was tendered, and the defendants objected to the evidence of the verbal offers.
    The evidence further showed, that the fifty-seven casks of oil were shipped to the plaintiffs in one invoice on board the Marcia in London; that there were in all 105 casks shipped to them by that vessel, in two invoices. The plaintiffs were advised of the invoice of the 57 casks, by a letter, dated London, March 3d, and received about a fortnight after, in which their correspondents advised them the Marcia was to sail on the 15th, for Boston. The bill of lading of the 57 casks was dated March 5th, of the 48 casks March 15th. They were advised of the latter shipment by a letter of the 27th March from London. The Marcia came out of the docks in London on the 26th March, but did not discharge her pilot in the Downs till the 29th March at midnight.
    The defendants’ counsel moved for a nonsuit on the grounds :
    1. That the words, sailed “on or about the 15th,” were a warranty or condition precedent, and that the sailing on the 26th was not a compliance.

      2. That the tender of 7211 gallons, net, was too great an excess over the amount purchased, viz. “ about 6000 gallons,” to be a good tender.
    3. That the written tender and correspondence, and the sale of the 7211 gallons, and the demand of the amount due on a sale of that quantity, could not be contradicted, or affected by the parol offer of 6000 gallons.
    4. That the contract being indefinite as to the quantity sold, was void for uncertainty.
    The court refused the motion for a nonsuit.
    The counsel for the defendants then offered to show, that both by commercial usage, and in this particular case, a vessel sailing from London, on or about the 15th March, would not have been considered as having so sailed, if she left on the 26th. Also, that in a tender of 6000 gallons, allowing for wantage, leakage, &c., an excess of more than five per cent, would not be considered as coming within the contract, and that the word “ about ” is put into the contract to provide against wantage and leakage. Also, that there is a fall and spring trade in linseed oil, and that the spring trade had ended before the oil arrived, and that to keep it over the summer would be prejudicial to the owner by deterioration, leakage, &c. To all of which several offers the plaintiffs’ counsel objected ; the court sustained the objection, and the defendants’ counsel excepted severally to each.
    The defendants’ counsel then requested the court to charge the jury as follows, viz.:
    1. That sailing on the 26th March from London to New York, was not a sailing within the contract.
    2. Also, that the correspondence between the parties and Mr. Harding excludes or overrides the parol evidence of Mr. Harding, as to a tender of 6,000 gallons, under the pleadings and evidence.
    3. Also, that a tender of 7,211 gallons, in the judgment of law, was not a tender of about 6,000 gallons, under the evidence.
    The court charged the jury, that, by the contract, the sailing of the vessel on or about the 15th March, was not a condition of the contract; and if the representation of the time of sailing were made without fraud, her sailing on the 26th did not prevent the plaintiffs from recovering.
    The defendants were not bound to receive under this contract 7211 gallons; but if the plaintiffs offered to deliver 7,211 gallons, with an expressed willingness on their part to deliver 6000 gallons, if the defendants would receive it, that would be a sufficient tender to entitle the plaintiffs to recover. If the defendants declined to accept the latter quantity, or if the plaintiffs gave the defendants an opportunity to receive 6000 gallons, and the defendants declined, then the tender was sufficient and unobj ecti onable.
    The sole question for the jury is, whether the plaintiffs tendered the 6000 gallons in the manner stated by the witness, 11 arding; if so, the plaintiffs will be entitled to a verdict as for 6000 gallons, with interest.
    To which charge of the court the defendants’ counsel excepted. The jury thereupon rendered a verdict for the plaintiffs for $852/⅛.

      D. Lord, for the plaintiffs.
    I. The tíme of sailing, stated in the sale note, was not a condition of the contract of sale. It was a representation in New York of the state of information of the parties as to the time of the supposed sailing of the vessel. It was fairly made, and believed to be true. It was an event uncertain to both parties, and the defendants took the risk of the time of arrival. If a condition, either it is void or the contract is void, for uncertainty. If a representation, it can have all the effect which good faith could require.
    In no decision is a clause made a condition, unless it be definite. If it had been on or before, it wonld have been definite, “ On or about,” are totally incompatible with a warranty. If the parties intended to make the time essential, they would have provided a precise time for arrival or delivery. The case of OUoe v. Booker, 1 Exchequer Rep. 416, illustrates that. In a charter party, a statement of about the amount of tonnage, is not a warranty. (Abbott on Shipping, by Story and Perkins, 241.)
    If the market price had advanced, and we had taken the ground that the ship did not sail till the 26th of March, and we were therefore discharged from our contract, how absurd it would appear ?
    II. Unless the time of sailing was a condition of the contract, the evidence offered as to the trade in oil, and of what was considered out of time, was clearly inadmissible. Usage is only allowed to give certainty to the contract. That offered, would make a contract of one date or one season of the year, mean a very different thing from one at another date or season.
    III. If having sailed on or about the 15th of March, was a condition, it was for the court to decide, under the undisputed facts, if the condition was broken. A delay of ten days in a ship, not a packet, in her time of sailing, was no substantial departure from the condition.
    IV. The parcel contracted for was identified, and the defendants were entitled to the whole invoice: and it was properly-tendered ; but they might be entitled to refuse any quantity beyond the number of usual sized packages, whose contents least exceeded 6,000 gallons ; and this was also properly tendered. There is no uncertainty in the subject sold.
    The tender could be proved by written evidence or parol, or by both. There could be no surprise, it being a fact within their own knowledge, and in issue in the cause.

      II Nicoll, for the defendants.
    I. The testimony of Harding in relation to the parol offer, to take six thousand gallons, ought to have been excluded; because the tender, negotiations, and claims relative to its subject matter, being wholly in writing, parol evidence was (especially under the pleadings in this cause,) inadmissible to alter its terms.
    The pleadings go solely to a tender of 7,211 gallons, as under the contract. The case set up was therefore a surprise.
    II. The motion for a non-suit ought to have been granted, because,
    1. The words, “ sailed on or about the 15th,” if a question of law as the judge treated it, were a warranty or condition precedent, and the sailing on the 26th was not a compliance. Considering the nature of the contract, the time the vessel sailed, is a material element, and the first in the mind of the buyer on contracting. Without it he cannot calculate when she will be likely to arrive. This was as important to our view of the contract as the quality of the oil. In a contract of insurance, these words would be a warranty. (2 Duer on Ins. 644 ; Jennings v. IThenango Mutual Ins. Co., 2 Denio 80; Burritt v. Saratoga Mutual Ins. Co., 5 Hill 191: Callaghan v. Atlantic Ins. Co., 1 Edw. Ch. R. 74; Hastings v. Lovering, 2 Pick. 219 ; Osgoorl v. Lewis, 2 Harr, and Gill 518 ; Cramer v. Bradshaw, 10 John. 484; Ilenshmo v. Bobbins, 9 Metcalf 88.) We did not want any opinion as to the time of sailing; we wanted the fact. (Higgins \. Livermore, 14 Mass. 106 ; Glaholm v. Hays, 2 M. & G. 257; lye v. Fynmore, 3 Camp. 462; Shepherd v. Fain, 3 Bam. & Aid. 240 ; Story on Sales 358.)
    2. The written tender and correspondence, the sale of 7,211 gallons, and the demand of the amount due on the sale of that quantity, could not be contradicted or overrode by the parol offer of 6,000 gallons.
    3. The tender of 7,211 gallons net, was too great an excess over the amount purchased, viz. “ about 6,000 gallons,” to be a good tender. (Gross v. Eglin, 2 Barn. & Adol. 106 ; Bussell v. Nicoll, 3 Wend. 119.)
    4. The contract being indefinite as to quantity, was void for uncertainty.
    III. The usage and other facts proposed to be shown by the defendants, were improperly excluded, because—
    1. All contracts are made in reference to the usage of trade; and the words, sailed on or about the 15th, are equivocal, and parol evidence is admissible to explain their meaning according to the understanding and usage of trade. The word “ about” is a relative term, and quite indefinite. (1 Phill. Ev. 562, and Oowen and Hill’s 1STotes, 1359,1399; 1 Holt 95, and reporter’s note ; Birch v. Deg)eyster, 4 Camp. 385; Idle v. Thornton, 3 Camp. 274 ; Powell v. Norton, 2 Bing. 1ST. C. 668; Mayor, che. v. Butler, 1 Barb. S. C. Rep. 334, 635 ; Bobertson v. Jackson, 2 M. Gr. & Scott 413 ; Chitty on Cont. 76, &e.)
    2. The contract is a mercantile contract, and the words, (for the purposes of this suit,,) were technical, and have reference to the length of the voyage ; and evidence of persons skilled in the trade was therefore admissible to explain their meaning as to the time of sailing. (Lilly v. Ewer, Doug. 74; Tctylor v. Briggs, 2 Carr and P. 525; Bridge v. Wain, 1 Starkie, N. P. C. 504; Callaghan v. Atlantic Ins. Co., 1 Edw. Ch. R. 74; None v. Mutual Safety Ins. Co., 1 Sandford 149.)
    3. The testimony of the spring and fall trade, &c., was admissible to show the situation of the parties at the time of making the contract, and the circumstances of the trade under which it was made, with a view to ascertain whether the words “ sailed on or about the 15th ” were a warranty, (or if only a representation,) whether it was a material one on which the parties relied, making an essential part of the contract; and this, whether the sailing on the 26th, under a contract to sail on or about the 15th, was a question of law or fact. (1 Edw. Cli. R. 74, above cited; Simpson v. Henderson, 1 Mood. & Malk 300; Prosser v. Hooper, 1 Moore 106.)
    IV. The charge of the judge was erroneous, because he ought to have charged: — 1. That the words in the contract, “ sailed on or about the 15th March,” were a condition of the contract. 2. That sailing on the 26th was not a compliance. 3. That, if these words were not a warranty, they were such a misrepresentation as would avoid the contract. (Flight v. Booth, 1 Bing. JST. C. 370 ; Hastings v. Lovering, 2 Pick. 219; Osgood v. Leíais, 2 llar. & Gill, 518,521; Jennings v. Chenango Mutual Lns. Co. 2 Denio 80.) 4. He should have submitted to the jury as questions of fact,whether sailed on or about the 15th March, was or was not intended by the parties as a warranty or such a material representation as entered into the terms of the contract, and whether sailing on the 26th March was a sailing on or about the 15th; having consideration to the distance and duration of the voyage and the other circumstances of the case. (2 Denio 80; Whitney v. Sutton, 10 Wend. 413.)
   By the Court.

Oakley, Ch. J.

Tl|¡e only question of serious consideration in this case, is the effect of the statement in the bought and sold note, that the vessel, by which the oil was expected to arrive, “ sailed on or about the 15th March ult.”

The .defendants say, this was in the nature of a condition or a warranty, and that if she did not sail at the time specified, the contract would be void and inoperative against them. On the other hand, the plaintiffs contend, that the words quoted were simply a statement of a fact that was supposed to exist by the parties, neither of them knowing or having the means of knowing, when they contracted, whether the vessel had sailed or not.

The defendants, besides claiming it to he a condition in terms, proposed to introduce evidence that merchants would have so considered it.

This proposition to prove the legal effect of a written instrument, by the opinion of merchants, is a novelty. Possibly, if these words, “sailed on or about” a given day, had acquired any meaning in trade or commerce different from their ordinary import, evidence to that effect might have been admissible ; but that was not the offer. The court is to decide as to the legal effect of the contract, there being no question as to the facts; and the testimony offered was properly excluded.

On the point that there was a condition or warranty, the defendants desired the judge, to submit it to the jury to say, whether the parties did not so -understand the bought and sold note when they contracted ; and, also, to find that the sailing of the vessel, on the 26th of March, was not a sailing on or about the loth of March, as provided in the contract.

The judge rightly declined to submit these matters to the jury, and put the question on the right ground, viz. whether the words referred to were a correct representation of what was understood by the parties on that subject.

The defendants’ counsel strenuously contended, that the words imported a condition precedent, or a warranty that the vessel had sailed as stated. ¥e have no hesitation in holding that, upon its terms, the language used did not import a stipulation ; and from its indefinite character, never could have been understood by the parties as a condition or warranty that the vessel had sailed at the time expressed.

It is very apparent on the face of the contract, that the plaintiffs did not intend, nor did the defendants understand that it was intended, to stipulate or warrant a particular time for the sailing of the vessel.

On this view, the plaintiffs are entitled to recover.

An objection was made to the plaintiffs’ offer to perform on their part. It appeared that the invoice of oil which they were apprised of, and in respect of which they contracted, contained over seven thousand gallons; and they made a written proposition and tender to deliver the whole. That proposal being declined, they qualified it afterwards, by an offer to deliver six thousand gallons out of the seven, if the defendants would take it; or to deliver them the whole of the six thousand at the contract price, and the surplus at the current market price of the oil. It is objected that this parol qualification of the tender made in writing, was inadmissible ; but we see no ground for the objection. The plaintiffs could make their offer orally, as well as in writing; or they could make it in both forms successively. Either mode was good, and they may rely on either. The tender was, in our opinion, complete.

But it is said the declaration did not warrant this proof, because it counted only on the offer to deliver the entire quantity of seven thousand gallons. This point was not raised at the trial. If it had been, the judge would doubtless have permitted the declaration to be amended. We cannot notice the objection here, as the variance between the proof and the averment in the declaration is immaterial.

The motion for a new trial must be denied.

       Affirmed in the Court of Appeals, Dec. 30, 1850.