text:
    Brainard against Cooper.
    The foreclosure of a mortgage by action is wholly inoperative as to an existing judgment creditor not a party to the suit.

      It seems that a judgment creditor who has not made his lien specific by a sale of the land, is entitled to redeem from a mortgagee in possession under a foreclosure to which such judgment creditor was not a party.
    Appeal from the supreme court. Bill filed by the plaintiff in the late court of chancery, to redeem certain land from a mortgage executed on the 29th December, 1830, by Charles Giles to the New York Life Insurance and Trust Company for $720. On the 18th May, 1832, Samuel and Schureman Halstead recovered a judgment in the supreme court against Giles for $3500, which was duly docketed. On the 18th August, 1832, the plaintiff recovered a judgment in the supreme court against Giles for $610, which was duly docketed. No sale had ever been had under this judgment. On the 2d October, 1833, one William H. Halstead, to whom the mortgage had been assigned, filed his bill for the foreclosure thereof, to which Samuel and Schureman Halstead, and other judgment creditors of Giles, were parties ; but the plaintiff, in this case, was not. The usual decree of foreclosure and sale was made and the land duly sold under it to Schureman Halstead, who purchased for the joint benefit of himself and Samuel Halstead, and received the master’s deed April 16, 1834. The purchase price was $800, less than the amount of the mortgage and costs. On the 20th October, 1838, Schureman Halstead, for the consideration of $1200, conveyed the premises to one Hall. On the 4th January, 1839, Giles executed a quit-claim deed to Hall, and Hall on the 13th April, 1841, sold and conveyed the land to the defendants in this suit. On the 4th July, 1842, the plaintiff offered to redeem the premises by paying the defendants the amount due on the mortgage and made a tender for that purpose; which being refused, he instituted this action on the 20th July, 1842, claiming to redeem upon paying the amount due upon the mortgage with interest, and the value of all permanent improvements made upon the premises, deducting the rents and profits received by the defendants, and praying for an account, &c. The cause was heard before Vice-Chancellor Gridley, of the fifth circuit, who made a decree in accordance with the prayer of the bill, except that it gave the defendants the alternative of paying the plaintiff’s judgment, if they should so elect. This decree having on appeal been affirmed by the supreme court at general term in the fifth district, the defendants appealed to this court.

      William Tracey for the appellant.

      Samuel Beardsley for the respondent.
   The cause was argued twice in this court, and five judges not concurring in any judgment, a third argument was ordered, when the following opinion was delivered:

Gardiner, J.

Chancellor Kent, in his commentaries, remarks that the right of redemption exists, not only in the mortgagor himself, but in every other person who has an interest in, or a legal or equitable lien upon, the mortgaged premises ; and that consequently every judgment creditor, and every other incumbrancer may redeem. (4 Kent Com., 162.)

Judge Story says (2 Story Eq., § 1023) that a judgment creditor and every other person being an incumbrancer, or having a legal or equitable title or lien on the lands, may insist upon a redemption of the mortgage.

It is a right inherent in the land binding all persons coming in under the mortgagor, 1 Powell on Mort., 251, Comyn's Dig., Mort., tit. 156, § 94. It rests upon a principle of natural justice that every person having an interest in the mortgaged premises may protect and render it effectual by a redemption of the mortgage, thereby becoming substituted to the rights and interest of the original mortgagee. (Story Sy., § 1021.) It is a valuable right, of which no one can be deprived against his consent, without due process of law affording to him an opportunity of exercising it if he deems it advantageous to his own interest.

It is immaterial whether the lien or interest is legal or equitable, or whether the equity of redemption, considered as an estate, is of one character or the other.

These principles, if sound, and they have heretofore been supposed elementary, dispose of this case.

Wm. Halstead was the owner of a mortgage, which was a specific, and prior lien upon the mortgaged premises. I shall call him mortgagee for convenience. The respondent, as creditor by judgment, was a junior incumbrancer, with a general and legal lien, upon the same lands. Before foreclosure he had the right to redeem the mortgage. The exercise of the right is now indispensable to protect his interest, as his lien will expire before a sale by execution could be effected. His sole remedy is a redemption.

The foreclosure of the mortgage without making the complainant a party, was, it is conceded, as to him a nullity. The relation theretofore existing between the parties was unchanged by that proceeding, and was consequently subsisting in its full force at the time when the complainant offered to redeem, and at the time of the commencement of this suit.

But it is said that by the § 158, 2 R. S., 192, the deed executed by the master on sale by virtue of the decree, is declared to be “ as valid as if the same were executed by the mortgagor and mortgagee.” But as against whom is this effect given to the conveyance ? The statute proceeds to declare “ it shall be an entire bar against each of them (the mortgagor-and mortgagee) and against all parties to the suit in which the decree was made,” &c. No others are affected. But the statute does not stop here. The same section provides “ that the deed shall vest in the purchaser the same estate, and no other or greater than would have vested in the mortgagee if the equity of redemption had been foreclosed.” The effect of a strict foreclosure was merely to extinguish the right ■ of redemption. The mortgagee obtained and held his estate, and all of it by virtue of the mortgage. The foreclosure barred the mortgagor and all other parties to the suit from ever after demanding a conveyance or surrender of that estate from the mortgagee. As to all the world the latter was but a mortgagee; and the only difference between those made parties to the suit and those not parties, was, that the former lost the right of redemption, which remained to the latter. (Watson v. Spence, 20 Wend., 262, 263.) This estate, that of a mortgagee after foreclosure, the statute in this case vested in Schureman Halstead as purchaser under the decree, and no “ other, or greater.” The deed of the master by which it was conveyed, was an entire bar against the mortgagee who had instituted the proceedings, and received value for his interest, and against the mortgagor, and subsequent incumbrances made parties, whose right of redemption was extinguished, as if the same had been by them severally executed.

This was its effect as a bar between those parties. But the sale did not vest in the purchaser the estate of the mortgagor, and make the former an assignee of the mortgage at the same time; but the estate and interest, one and indivisible, prescribed by the statute, namely, “ that which would have vested in the mortgagee, if the equity of redemption had been foreclosed.” According to the, statute therefore, as well as by adjudged cases, it is clear that this foreclosure as against the complainant, a judgment creditor and not a party is utterly void. (3 J. C. R., 465; 4 Kent, 184; 2 Seld., 562, 565.) It follows, that as to the mortgagor and all other parties to the suit, a mortgagee by the foreclosure obtains what is equivalent to a fee in the mortgaged premises. As to the judgment creditor not a party, the mortgagee (or purchaser at the master’s sale who succeeds to his rights ) remains in possession as such, with a mere lien for his debt, liable consequently to account for the profits, and either to pay off the demand of the redeeming creditor, or on receiving the mortgage debt to convey to him the premises as the only thing representing the mortgage in his power to transfer.

But it is said, in the second place, that a naked judgment . lien in this state, is not a sufficient title for the redemption of a prior incumbrance.

As this doctrine is in opposition to the principle laid down by every elementary writer, some authority must be shown to warrant the exception, and none such can be found. We are referred to 9 J. R., 612; Coote on Mortgages, 514; and Powell on Mortgages, 331. It is there said, “ that no person can come to a court of equity, for a redemption of a mortgage, but he who is entitled to the legal estate of the mortgagor, or claims a subsisting interest under him.”

But a judgment creditor having a lien has a subsisting interest under the mortgagor, within the letter and spirit of the rule, as held by Powell, and every other writer. (Powell on Mortg., 271, 274, note o.)

Difficulties occasionally occur in the English cases, in determining when the lien accrues, but when established, it always carries with it the right of redemption. When the mortgage is of a chattel interest in property, there is no lien until execution is issued. (Burden v. Kennedy, 3 At., 739; Shirley v. Watts, Id., 200.) The same rule prevails with us. (3 Paige, 320; 1 Id., 308; Merry v. Hallett, 2 Cow., 497.) But in England, and in this country, judgments become a lien on the freehold estate of the debtor, from the time they are docketed, 2 Cowen, swpra, and no execution is necessary to authorize a redemption. In Neate v. The Duke of Marlborough (3 Myl. & Craig., 416, 417),'the chancellor observed “that for certain purposes, the court recognizes a title by the judgment, as for the purpose of redeeming.”

This decision was in 1838, and shows that in England, they allow a redemption where the lien is constructive. It was never doubted there, or anywhere else, until this case, that an actual lien, legal or equitable, always gave that right to the creditors. In Morret v. Westerne (2 Vern., 663), decided in 1710, it was held that a judgment creditor could sustain a bill to redeem a mortgage, where the mortgage had been previously foreclosed. The like in Godfrey v. Chadwell (2 Vern., 602), which is this case precisely, with the single exception that there the lien was upon an equitable instead of a legal interest. But in England, a fieri facias, or an elegit can issue upon a judgment, and there is no pretence that either were resorted to.

In Haines v. Beach (3 John. Ch. R., 460), the elder mortgage had been foreclosed, and the premises sold to a third person; the second mortgagee filed his bill against the purchaser to redeem, and allowed. The same principle in this case was applied to a lien upon the legal estate, which, in the case from Vernon, had been sanctioned as to the equitable.

In Roosevelt v. The Bank of Niagara (1 Hopk., 582), the bill was filed, by a judgment creditor, to redeem and compel an assignment of a mortgage, and the allowance of an account in favor of the mortgagors against the mortgagees upon the mortgage. Decree in their favor as to all the relief prayed, and decree affirmed in error on appeal. Here was no sale, no execution. The plaintiff claimed a right to redeem as judgment creditors, by virtue of a legal lien, on the legal estate of the mortgagors and as incident to that right to call upon the court to adjust the amount equitably due on the mortgage.

It was said in the court of errors (9 Cow., 413), that the plaintiffs coming in to redeem, as judgment creditors, were entitled to the assignment of the mortgage; and yet it is said there is no authority for a redemption by a judgment creditor without sale. If by this, nothing more is meant than that such counsel as Van Vechten and Bleecker did not raise any such point, it must be admitted. The objection indeed is of modern origin, and so far as I can learn, was never suggested until the present controversy.

In Benedict v. Gilman (4 Paige, 58), the mortgage which was the first lien, had been foreclosed at law, and the premises bid in for the complainant, who filed his bill against Gilman, a subsequent judgment creditor, to compel him to redeem or stand foreclosed. Decree accordingly.

This, like the case in Hopláns R., is directly upon the point in controversy. By the foreclosure the mortgagor was barred of his equity of redemption, precisely as in the present case. The bill then called upon the judgment creditor, who had neither issued execution nor sold the land, to redeem or to forfeit all his rights. According to the doctrine put forth in this case, the creditor had no right to redeem; and yet, by a decree of the chancellor, he was compelled to exercise a right which he did not possess, or be foreclosed forever.

There are numerous cases in our reports which have not been cited, and to which I shall not refer, as they only recognize the general principle laid down in elementary writers. I conclude by expressing my belief that, within the last one hundred years, no decision of any court, no dictum of any equity judge, nor a suggestion of counsel in any case involving the question, can be produced to sustain the position, that a judgment creditor having a lien upon mortgaged premises, is not entitled to redeem without the issuing of an execution and sale of the land, or either of them.

I think the judgment should be affirmed.

Johnson, Jewett and Watson, Js., concurred.

Rugóles, Ch. J., Wells and Mouse, Js., were for reversal.

Five judges not concurring on the second reargument, the judgment was affirmed by force of the statute, Code, § 14.


source: Caselaw Access Project

author: Jewett, J.,

license: Public Domain

text:
    Bailey, President of the Farmers’ and Drovers’ Bank of Somers, against Ryder and others.
    No decree can be made in favor of a complainant on grounds not stated in his bill.
    In proceedings in equity, if fraud is not alleged in the pleadings, no proof of it can properly be received.
    Where a creditor’s bill charged certain defendants with holding lands in trust for the judgment debtor, who had advanced the purchase money and procured the title to be taken in their names, and it appeared, by the proofs, that the lands were held in trust for the chdld/ren of the judgment debtor, such children being also parties, it was held, that under the allegations of the bill the lands could not be reached by the creditor. That the basis of the bill (a trust in behalf of the judgment debtor) was disproved, and the complainant could not assume that the transaction was fraudulent as against himself, not having so alleged in his bill.
    The supreme court has power to compel a judgment debtor to convey lands in another state, for the benefit of his creditors, in such a manner as to vest in the grantee the legal title.
    This was a creditor’s bill upon a judgment in favor of the plaintiff’s bank against the defendants, William Ryder and Robert H., Jesse and Henry Lounsbury, recovered in August, 1843. The bill was filed in the court of chancery in October, 1845, and sought, among other things, to reach, and apply upon the judgment, about twelve hundred acres of land, in the State of Indiana, which it was alleged that William L. Ryder, in 1836, had caused to be purchased with his own money, the title being taken in trust for himself, in the name of his cousins Jesse and Aaron L. Ryder, who were also made defendants. The answers of the defendants William, Jesse and Aaron L. Ryder, set forth an arrangement between themselves at the time of the purchase referred to, by which they were to buy wild western lands together, each furnishing a portion of the necessary funds; and that it was also agreed, at the time, that the lands purchased with the money advanced by William Ryder should be conveyed directly to his cousins, or one of them, to be held, managed and sold, if a sale should be desirable, by them as trustees for his children. The children of William Ryder, were thereupon made defendants by an amendment to the bill, alleging merely that they claimed or pretended some right or interest as cestuis que trust or otherwise in or to the share of the lands purchased with their father’s money. The answer of William Ryder also admitted that he had purchased and then held the title to forty acres of land, situate in the county of Noble, in the State of Indiana. The substance of the pleading is more particularly given in the opinion of the court.
    The cause was heard on the bill taken as confessed as against the defendants Robert H., Jesse and Henry Lounsbury, and upon pleadings and proofs as against the other defendants, and a decree made in 1849, by the supreme court at general term in the second district, ordering the defendants who were in default to assign their property to a receiver, according to the prayer of the bill, but dismissing the bill as against the other defendants with costs. The plaintiff appealed from that part of the decree dismissing the bill.

      Samuel Stevens for the appellant.

      Azor Taber, for the respondent, insisted, among other things, that the courts of this state had no power nor jurisdiction on a creditor’s bill to reach lands lying in the State of Indiana, and apply them in satisfaction of a judgment in this state; and cited 2 Story's Eq., §§ 742, 744; White v. White (7 Gill by John., 208); Picquet v. Swan (5 Mason, 42); Roberdeau v. Rous (1 At., 543); Rafael v. Verelst (2 W. Black., 1058.)
   Jewett, J.,

delivered the opinion of the court. The complainant insists that that part of the decree dismissing his bill with costs should be reversed, and that the defendants, Jesse Ryder and Aaron L. Ryder, should be decreed to be trustees for the judgment debtor, William Ryder, for the land in Indiana, for which they took conveyances in their own name, and for which William Ryder paid the purchase money to the amount of $1500.

The ground assumed for a decree declaring John Ryder and Aaron L, Ryder to be trustees for William Ryder, of the land in Indiana, was, that as he had advanced about one-third part of the money expended in the purchase of these lands, for which Jesse and Aaron L., had taken the title in their names, at common law, he was entitled to that proportion of the land purchased as the cestui que trust of a resulting trust of which Jesse and Aaron L., were the trustees; and that in the absence of proof to the contrary, the common law was presumed to be the law of Indiana, the lex loci contractus, by which the effect of the trust was to be determined. The complainant’s bill goes upon the ground that by reason that William Ryder, pursuant to an agreement made between him and Jesse and Aaron L., advanced a certain proportion of the purchase money for their lands, and that the title was taken in the names of Jesse and Aaron L., a trust in them, to the extent of the money advanced by him, resulted to him, which the complainant was entitled to have applied in payment of his debt against him by the court of chancery. In that respect the bill alleges that in June, 1836, William Ryder, Jesse Ryder and Aaron L. Ryder, entered into an arrangement or agreement to purchase western lands together. That the agreement was, that William and Jesse should go to the western country together to select and purchase the land; that each of said three persons should furnish a part of the money with which to pay the purchase price; that the title to the land purchased should be taken in the joint names of the three, or in the joint names of Jesse and Aaron L., and that each of the parties should have an interest in the lands purchased, in proportion to the amount of money furnished by him for such purpose.

It is then alleged that William and Jesse, in June, 1836, did go, pursuant to the agreement, to the State of Indiana; ' that William furnished between $1400 and $1500 towards the purchase money, and that Jesse expended that money, and purchased therewith and with other money furnished by Jesse and Aaron L., about five thousand acres of government lands, situate in certain counties named, in Indiana, for and on account of William Ryder, to the extent of and in proportion to the sum of money so furnished by him; that the whole amount of money so expended was between $5000 and $6000, and that, the proportion of the lands so purchased, with the money furnished by William Ryder was about one thousand two hundred acres; that the title to the lands so purchased by consent of William Ryder was taken in the joint names of Jesse and Aaron L., and that the legal title to the said lands still remained in Jesse and Aaron L., except as to about one hundred and sixty acres which they had since sold and conveyed.

The bill called for an answer by William Ryder, Jesse Ryder and Aaron L. Ryder upon oath, which they severally put in ; and in relation to these lands their answers set up the facts substantially, as follows: William Ryder says that before he went to the west in June, 1836, he had determined to purchase some new lands in the west for the sole and exclusive benefit of his children; that being informed that Jesse and Aaron Ryder were going west to invest money in the purchase of new lands, he called on them and proposed to go in company with them, upon which he was told that Aaron L. was not going, but that Jesse was going, to purchase for them; that then William proposed to go and purchase with him, and that it was then agreed that William and Jesse should go in company to purchase their lands together, and that the title should be taken in the names of Jesse and Aaron L.; that at the time of the agreement, William intended that the purchase so to be made with the money so to be furnished by him should be for the use and benefit of his children; that afterwards William Byder went with Jesse Byder and Bichard H. Williams to Indiana; that William furnished about $1500, and Jesse and Aaron L., respectively, an equal amount, which, after they arrived in Indiana, he gave to Jesse Byder, with directions to invest the same in such lands and to take the title in his and said Aaron L. Byder’s names, for the use and benefit of the children of William, and to hold the same for their use; and if at any time he desired to dispose of or convey the lands, or to declare the trust so held by him and said Aaron L., then, Jesse and Aaron L. should convey and declare said trust and lands to William Byder’s children; that Jesse Byder took the money, and with an equal amount from Jesse and Aaron L., Jesse purchased, as he informed William, about five thousand acres in the name of Jesse and Aaron L. It is further alleged that it was also agreed that if any division was thereafter made of said lands, that the portion purchased with the money furnished by William should be conveyed to said children for their use and benefit, or if the lands should be sold, then that the proceeds of such portion should be paid to them for their use and benefit. William Byder says that he was informed by Jesse, who in his answer asserts the fact, that in two or three years after-wards he and Aaron L. executed a declaration of the trust as before stated. On the coming in of these answers, the children of William Byder, by an amendment of the bill were made parties defendants. It merely alleges that they claim or pretend some right or interest as cestuis que trust, or otherwise, in or to the share of the aforesaid government lands purchased with the money furnished by said William By der, and prays an answer to the bill, waiving their oaths. The answer of the children of William Byder was put in and it sets up that they were informed and believed it to be true, that in the summer of 1836, William Ryder, Jesse Ryder and Richard H. Williams, went to Indiana to purchase new lands; that before they went William informed them that he was going to place in the hands of Jesse $1500, to lay out and invest in their lands for the sole use of them, his children, and that he should direct Jesse to lay out the money as he should think to be most advantageous for them, and take the title in the names of Jesse and Aaron L. Ryder to hold in trust for their use ; that soon after the return of William and Jesse Ryder from Indiana they informed them, that before the purchase of any lands, William Ryder delivered to Jesse $1500, directing him to lay it out in such lands to the best advantage for their use, and to take the title in the names of Jesse and Aaron L., and hold the same in trust for their use; that Jesse, at the same time, informed them that he did receive said money in pursuance of such directions and agreement, which, with the money furnished by himself and Aaron L. Ryder, he laid out in the purchase of such lands, and that they were interested in such land to the extent of $1500, and that the title was taken in the names of Jesse and Aaron L., to hold in trust for them to the extent of their interest. They further set up that in January, 1839, Jesse Ryder delivered to them an instrument in writing, duly executed by Jesse and Aaron L. Ryder, under their hands and seals, conveying the interest of said children in said lands to them for their sole use and benefit.

The principal facts set up by the defendants as a defence against the complainant’s claim, in respect to the creation and execution of the trust for the benefit of the children of William Ryder, are, I think, substantially proved by the evidence in the case. The answers of William, Jesse and Aaron L. furnish evidence of the truth of them. And the evidence given by Jesse as a witness, as also that given by Williams, and the declaration of trust read at the hearing, tend strongly to confirm them, notwithstanding there are witnesses who testify to some declaration made by William Ryder tending to a contrary conclusion. It was contended on the argument, in behalf of the complainant, that the investment of the $1500 by William Ryder, although in trust for his children, was intended to defraud his creditors then existing, or who should thereafter exist; that it was in the nature of a voluntary conveyance to defraud creditors, and was, therefore, void as to such creditors. One answer to this, and which I think is sufficient, is, the complainant has made no such case by his bill. That goes solely, in respect to these lands, upon the ground that William Ryder was the equitable owner of them; the lands having been purchased by his direction and with his money, and the title taken and held for his use and benefit by Jesse and Aaron L. Ryder. There is no allegation or suggestion in the bill that the investment made by William for the benefit of his children was voluntary or fraudulent as against his creditors. The only point which the bill attempts to put in issue in respect to these lands is, whether or not the purchase of them was in trust for the benefit of William Ryder; there is no allegation that if the character of the transaction was, in fact, nominally as set up by the defendants, that it was fraudulent. The answers assert, and the evidence shows, that the purchase and investment made, was not for the benefit of William, but for his children. That defeats the bill in regard to the complainant’s claim to have those lands applied in payment of his demand. If his rights depended upon the fact that the purchase and investment for the benefit of the children of William Ryder was fraudulent as against him, it should have been so alleged, for it is an invariable and universal rule of the court of chancery, to found its decrees on some matter put in issue between the parties by the bill and answer; and the rules and practice of that court required that in framing the bill the matter of it should be plainly and succinctly alleged, with all necessary circumstances, as time, place, manner, and other incidents, and if any material facts were denied by the answer, and the complainant proceeded to substantiate the facts charged in the bill, he could put no interrogatory to witnesses that did not arise from some fact charged in the bill. It makes no difference whether the defendant has, by way of avoidance set up a distinct and independent fact, or merely denied the matters alleged in the bill. If the existence and truth of the facts thus set up by a defendant be controverted, the defendant must prove it; and the complainant may examine witnesses to disprove it; but when the fact set up by a defendant is made out, either by proof or the admission of the complainant, and destroys his title to relief, it is not admissible for the complainant, after the fact is made out, to impeach it on a ground not taken in his bill, and on a ground not arising from the issue between the parties.

If the complainant’s rights- depended upon showing that the creation and execution of the trust for the use and benefit of the children of William Ryder was voluntary and fraudulent as against him, his course was plain. He should have amended his bill and stated the facts on which he meant to impeach it. The defendants would have been required to answer such facts, and if denied, it would then have been competent to have supported .the allegations by proof, (Ferguson v. Ferguson, 2 Comst., 360; Kelsey v. Western, Id., 500; Thomas v. Austin, 4 Barb., 265.)

The rule is explicit and absolute, that a party must recover in chancery according to the case made by his bill or not at all, ‘ secundum allegata’ as well as 'probata.'

Notwithstanding the forty acres of land, to which William Ryder, in his answer, admits he has title, is situated out of this state, in the State of Indiana, I think that the court of chancery in this state had jurisdiction to compel him to execute such a conveyance or transfer thereof as would be sufficient to vest the legal title, as well as the possession of the land. (Mitchell v. Bunch, 2 Paige, 606.) My conclusion, therefore, is, that that part of the decree of the court below which dismisses the bill of complaint as against the said William Ryder, with costs against the complainant, as to him should be reversed, and that the residue of the decree should be so modified as that its provisions against the defendants, Robert H. Lounsbury, Jesse Lounsbury and Henry Lounsbury, shall apply as well against William Ryder as against them, and that neither party shall have costs as against the other on this appeal.

All the other judges, except Welles, J., who was absent, concurred.

Decree modified accordingly.


author: Johnson, J. Gardiner, J.

text:
    Laraway against Perkins.
    Under the plea of non est factum,, in action of covenant, neither a mutual abandonment of the contract by the parties, nor the non-performance by the plaintiff of conditions .precedent, can be given in evidence.
    In an action of covenant on a contract by which the defendant agreed to build a house for the plaintiff, and the plaintiff to convey to the defendant a house and lot in payment therefor, the breach being the neglect to build the house, the difference in value between the house and lot to be conveyed and the bouse to be built is, as against the defendant, a proper measure o.f damages.
    No statement of special damages in such case is necessary to entitle tho plaintiff to give evidence of the difference in value.
    Lara way and Perkins entered into a contract under seal, by which the former agreed to sell to the latter a certain house and lot, and the latter to build a house for the former according to certain specifications, each of these mutual covenants being expressed as the consideration for the other. The house was to be finished, on the one part, and on the other possession given of the house and lot, and a deed executed on the first day of May, 1848. Laraway brought this action of covenant upon that contract, his declaration setting it forth, and assigning for breach the neglect to build the house. The defendant pleaded non est factum.

    At the trial at the Greene county circuit, before Parker, J., the plaintiff was allowed to give evidence of the difference in value between the house and lot contracted to be sold by him, and the house to be built by the defendant. To this the defendant objected, on the ground that it should have been stated in the declaration that such damages were claimed, and also that the difference in value was not a proper measure of damages for the defendant’s breach of the contract. The defendant proved that nothing had been done under the contract on either side, and asked the judge to charge that the contract had been mutually abandoned by the parties. The judge refused so to charge, and the defendant excepted. Upon the measure of damages thus established, the jury found a verdict for the plaintiff for $600. The defendant appealed.

      John H. Reynolds for the appellant.

      H. Hogeboom for the respondent.
   Johnson, J.

The only plea to this action of covenant which the defendant has interposed is non est factum, under which neither a mutual abandonment of the contract between the-parties nor the non-performance by the plaintiff of conditions precedent can be given in evidence. The only question contained in the bill of exceptions which we are called upon to consider, is whether the evidence as to the damages in this case was correctly admitted at the trial. This evidence was objected to on two grounds: First, that the difference in value of the house and lotto be conveyed to the defendant by the plaintiff and the house to be built by the defendant for the plaintiff was not the true measure of ithe damages sustained by the plaintiff by the defendant’s breach of covenant; and, second, that such damages were not recoverable unless specially stated in the declaration. If the contract in suit had contained no covenant to be performed on the part of the plaintiff, but only the defendant’s covenant to build a house for the plaintiff, then it is clear, not only that the measure of damages would be what it would be worth to build such a house, but also that those damages could be recovered under the common conclusion of the count in covenant, without any averment of special damage. It is the common case of work contracted to be done, materials to be furnished, goods to be delivered, in all which the damages are measured by ascertaining what it would have been worth to perform, and may be proved without any averment of special damage. The fact that the consideration for the defendant’s covenant was executory and not executed makes no difference; and the defendant cannot complain that the judge directed the value of the consideration which he was to receive to be deducted from the plaintiff’s damages.

A new trial must be denied and the judgment affirmed.

Gardiner, J.

The damages assessed by the jury, under the ruling of the judge, were “ the fair legal and natural result of the breach of the defendant's agreement.” The defendant had contracted to build a house for the plaintiff and receive his pay in land. He failed altogether to perform his agreement. The difference in value between the house and the land was the natural and necessary measure of damages. If the plaintiff, by the contract, had obliged himself to pay $1000 in money, for a building which, when completed, would have been valued at $1750, he would have lost, by the non-performance of the contract by the defendant, $750. There would be nothing remote, contingent or speculative in such a rule of damages. He would have been compelled to pay the sum last mentioned, over and above the price stipulated for the subject of the contract. It can make no difference in principle, that the consideration for the undertaking of the defendant was land instead of money. There may be more difficulty in establishing the amount of the consideration in the latter case, but, when ascertained, the rule of compensation should be the same in both instances.

The damages in this case resulting necessarily from the breach of the contract upon the part of the defendant, it was not necessary that they should be specially stated in the declaration. (1 Chit. Pl., 348, 7th ed.; 5 Wend., 538; 3 Esp., 83; 1 Taunt., 566.)

As this was the only point argued, the other questions presented by the bill of exceptions being abandoned, the judgment of the supreme court must be affirmed.

All the judges concurred.

Judgment affirmed.


author: Welles, J. Jewett, J. Paterson, J.,

text:
    Thomas Burch against Newbury and another.
    The defendants, exchange brokers at Chicago, in April, 1845, agreed to terminate their partnership on the first of May following. On the thirtieth of April, one partner having formed a new partnership with the plaintiff to continue the business from the first of May, settled with his former partner, and in the settlement canceled two notes of the old firm, amounting to $10,000, which had been taken up by the members of the new firm, and received therefor from the old firm a draft payable to the order of the new firm for $3000, on J. T. Smith & Co., of New-York, correspondents and agents of the old firm, and an order for certain drafts ( or their proceeds ), which had been sent by the old firm to Smith & Co. for collection. The draft and order amounting to near $11,000, covered all the asset's of the old firm in the hands of Smith & Co., and exceeded the amount of the two notes and interest, $940.93, for which sum the note of the new firm was given to the old. The new firm, on the first of May, transmitted by mail from Chicago, to Smith & Go., at New York, the draft and order, with instructions to place the amount of the draft to their credit, and to hold the paper mentioned in the order for collection for them. Smith & Co., acknowledged the receipt of the draft and order on the ninth of May, by mail, saying they had placed the $3000 to the credit of the new firm, but had not then time to examine the accounts of the old firm as to the order. This letter by mail could not reach Chicago until after the sixteenth of May. No other demand was made by the new firm upon Smith & Co. for the $3000, or the drafts, until after May sixteenth, when Smith & Co. failed, having previously received the avails of all the drafts, except $1000. They were insolvent on the thirtieth of April, but were in good credit, arid paid all demands upon them until their failure. The bill in this cause was filed by the incoming partner, against the members of the old firm, to compel the retiring partner to pay to the new firm one-half the amount of the two notes and interest:

      Held, that the old firm was not liable to the new, for the losses sustained by the failure of Smith & Co.
    That the only guaranty on the part of the old firm was, that the things which they assumed to transfer were in fact what they described them to be.
    That if the guaranty extended further, the new firm had made Smith & Co. their agents, and assumed the risk of their responsibility.
    The provision, in § 460 of the Code of 1849, authorizing an appeal “ in any suit in equity pending in the supreme court on the first day of July, 1847,” must be construed as authorizing appeals in suits in equity pending in that court on tho first Monday of July, 1847; such construction being necessary to give any effect to the statute, as no such causes could be pending in the supreme cuirt, under the constitution of 1846, prior to the last mentioned date. Per Jewett, J.
    The act referred to, so far as it authorized an appeal from a decree where the time previously allowed for appealing had expired, and the decree had been executed, although not affected by the provisions of the United States constitution prohibiting states from passing ex post facto laws, or laws impairing the obligation of contracts, is in conflict with the provision of our state constitution, declaring that no person “shall be deprived of life, liberty or property without due process of law,” and is therefore void. Per J ewett, J.
    A statute which contingently deprives a person of property, the right to which was perfect under prior laws, is within the prohibition of the constitution. Per Jewett, J.
    In Equity. Appeal by the plaintiff from the decree of the supreme court, rendered in the fifth district, affirming the decree pronounced by G ridley, J., at special term, dismissing the bill of complaint. (1 Barb., 648.) The bill was filed in 1846, before the chancellor, and was transferred under the constitution of 1845, to the supreme court. The case made by the pleadings and proofs was as follows:
    Prior to the 1st day of April, 1845, the defendants, Walter L. Newbury and Isaac H. Burch, had been engaged in the business of exchange brokers in the city of Chicago, as copartners under the name and style of Newbury & Burch, and so continued until the thirtieth of April of the same year, when they dissolved their partnership and closed their business.
    In the course of their business as such exchange brokers and on the 1st day of July, 1843, they gave two notes of $5000 each, with T. Burch & Co. as surety, payable on demand, one to the order of A. Gr. Story, cashier, at the Herkimer County Bank, with interest at the rate of three per cent, per annum, from the thirtieth day of June previous, which was afterwards, by stipulation, reduced to two and a half per cent from December 13th, 1843; and the other, payable to the order of Watts Sherman, cashier of the Albany City Bank, with interest at the rate of two and a half per cent per annum, from the twelfth day of June previous. For these notes they received the respective amounts thereof from the banks mentioned, in their bank notes, which were used and circulated in the business of Newbury & Burch, at Chicago. These bank notes were marked, so that they could be recognized, and when they came in for redemption, Newbury & Burch provided funds for that purpose, and cohtinued to circulate and redeem them, down to the time of the dissolution of their partnership on the 30th day of April, 1845.
    Shortly before the 1st of April, 1845, Newbury & Burch •agreed that their copartnership should be dissolved on or about the first of .May following. About the first of April of the same year, Isaac H. Burch came to this state, and while here made two notes of $5000 each, one payable to the Albany City Bank and the other to the Herkimer county bank, which were signed by himself and by T. Burch & Co. as surety, both on demand, with interest at the rate of two and a half per cent per annum — which were discounted at such banks, and the proceeds used by Isaac H. Burch in paying and taking up the two former notes of Newbury & Burch of the same amounts and" at the same banks. When I. H. Burch paid the two notes of Newbury & Burch to the banks, of $5000 each, they were endorsed by the banks as paid in full by I. H. Burch. On the 5th day of April, 1845, the plaintiff and the defendant, Isaac H. Burch, entered into an agreement of partnership in words and figures following: “ Memorandum of an agreement made this 5th day of April, 1845, by and between Thomas Burch, of Little Falls, Herkimer county, New-York, of the one part, and Isaac H. Burch, of Chicago, Illinois, of the other part, to form a copartnership for the transaction of the banking and exchange brokerage business in the city of Chicago, Illinois, on the following terms and conditions:
    “ 1. The style and name of the firm shall be, ‘ I. H. Burch & Co.’
    “ 2. Each party shall be equally liable for two notes of ( $5000) five thousand dollars each on interest at two and as half per cent (2¿) per annum, da.ted April 1st, 1845, signed ‘I. H. Burch,’ and ‘T. Burch & Co.,’ surety, made payable, one to the Albany City Bank and the other to the Herkimer County Bank, and for all notes that shall be given to renew the same, and the proceeds of said two notes shall be used in the business of the company.
    “ 3. The business of the firm shall be transacted by Isaac H. Burch, who shall reside at Chicago, and the name of the firm shall not be used in any manner except in the business of the company.
    “ 4. Said Isaac shall devote his time to the business of the company, and receive as compensation for his services a yearly salary of one thousand dollars.
    “ 5. All necessary expenses for conducting the business shall be paid by the company, and the profits and losses shall be shared equally by each party.
    “6. This agreement shall take effect on the first day of May, 1845. “ Thomas Buiioh,
    “ Isaac H. Buech.”

      After the execution of this agreement, Isaac H. Burch returned to Chicago with the two notes of Newbury & Burch, of $5000 each, which he had taken up from said banks, and on the 30th day of April, 1845, he and Newbury had a settlement, and an account was stated in which New-bury & Burch were charged with the two notes last mentioned, with a small amount of interest on each, and also with I. H. Burch & Co’s, note on demand for $940.93, amounting in all to $10,961.48; and in which Newbury & Burch were credited with their draft on John T. Smith'& Co., to the order of I. H. Burch & Co., for .$3000, and an order on said Smith & Co. for certain drafts previously transmitted to their house for collection, amounting to $7961.48, which, with the draft of $3000, just balanced the debits in that account. The order was as follows:
    “ Chicago, April 30, 1845.
    “ Messrs. J. T. Smith & Co., New York,
    “Gentlemen, please deliver to I. H. Burch & Co., or order the following described drafts, or their avails, which you have received from us for collection.”
    Then followed a description of the drafts, all of which would mature at various dates from the twenty-third of May to the sixteenth of June following. The draft fo.r $3000, the order for the collection paper and the note of I. II. Burch & Co., stated in the account, were made at the same time; and the draft and order on Smith & Co. were delivered to I. H. Burch, and the note of I. H. Burch & Co. delivered to Newbury; and at the same time I. H. Burch wrote across the face of both of the two $5000 notes of Newbury & Burch a receipt of $5000, in full, and signed his individual name to the receipts. The account mentioned, as first drawn, commenced as follows: “ Newbury & Burch, in account with I. H. Burch & Co.,” but the words “ & Co.,” were obliterated by I. H. Burch at the same time.
    On the 1st day of May, 1845, the new firm of I. H. Burch & ■ Co. commenced business at Chicago, in pursuance of their articles of partnership, and on the same day transmitted the draft of $3000, made by Newbury & Burch, by mail, to John T. Smith & Co., who had for sometime previously been the corresponding agents of Newbury & Burch in the city of New York, and on the same day they again wrote to Smith & Co., enclosing the order together with other drafts for collection, directing the sale at once of two $1100 drafts mentioned in the order, and referring to the $3000 draft of Newbury & Burch, sent that morning; and concluding as follows:
    “The above draft of Newbury & Burch is, by their books, the balance they have left with you. Should it not prove so, we will adjust all discrepancies where they are in error. Should their draft of $3000, sent you by last mail, not reach you in due time, you will make the transfer, and advise us at once. Please acknowledge to us the receipt of the paper called for by their order, specifying the items and time of maturity, and hold them for collection for our account. You will direct your Boston and Philadelphia correspondents to pay our drafts on you, and advise us how to draw on those points..
    “ Respectfully yours, &c.,
    “ I. H. Burch & Co.”
    The order of Newbury & Burch for the collection paper, and their draft for $3000, were received by John T. Smith & Co., on the eighth or ninth of May, and on the ninth Smith & Co. wrote I. H. Burch & Co., acknowledging the receipt of their previous communications, together with the order and draft, and concluding as follows : “ We have not time to-day to examine N. & B. order for the paper; will report in our next. We wrote you on the seventh inst., advising yours of the first.”
    Thomas S. Underhill, a witness for the plaintiff, testified that he was a member of the firm of John T. Smith & Co.; that the draft for $3000 was passed to the credit of I. H. Burch & Co. by their directions, by J. T. Smith & Co.; that if it had been presented by any party not having an account with them, the money would have been paid ; that the firm of J. T. Smith & Co. was not required to pay to any one the avails of the paper mentioned in the order, or to deliver said paper, or any part of it, prior to May 16th, 1845, except by the order itself and the letter enclosing it, (an extract from which and all that relates to the order is given above); that the house of John T. Smith & Co., in New York, was in good and full credit, doing business as exchange brokers and bankers, paying all demands made upon it up to 'the 16th day of May, 1845, and would have paid any drafts of Newbury & Burch to the amount of the said order in the hands of third persons at any time before that date, without reference to how the account stood between them; had the order, in the shape it was sent, been presented at their counter by a third person (such a thing being unusual, and never happening between them before), they would have taken time to examine the account of Newbury & Burch before they would have paid it, for the reason that it was out of the regular course in which they did business; if they found the account good, they would have paid the avails of the paper mentioned in the order, although the house of John T. Smith & Co. was insolvent at the time, but it was paying all demands upon it, owing to its good credit; that the house was in the habit of selling any paper they received from Newbury & Burch, without waiting for special instructions, and the latter never complained of it; that the paper mentioned in the order was all sold by this house before the receipt of the order, except one draft of $1000, which I. H. Burch & Co., afterwards received.
    I. H. Burch, who was also examined as a witness, among other things testified that the order was drawn by Newbury & Burch for the paper, or its avails, in order to provide for ■the contingency of its having been sold.

      It was admitted by a stipulation between the attorneys for the respective parties, that the house of J. T. Smith & Co. were employed as the agents in New York of the firm of I. H. Burch & Co. in like manner as they had been the agents of Newbury & Burch; and said house of J. T. Smith & Co., continued in business, in good credit, until the morning of the 16th of May, 1845, when they stopped, doing no business on that day.
    That the two notes signed by Isaac H. Burch and T. Burch & Co., surety, of $5000 each, mentioned in the articles of partnership of I. H. Burch & Co., were made and used in contemplation of such partnership, and for the purpose of taking up the two previous notes of Newbury & Burch of $5000 each, produced by I. H. Burch on the dissolution between him and Newbury.
    It appeared that nothing was ever received by I. H. Burch & Co., on account of the order of Newbury & Burch, upon Smith & Co., for the drafts, excepting the draft of $1000 which had not been sold, as before stated.
    The object of the suit was to compel the defendant, New-bury to pay over to the plaintiff, one-half of the amount remaining due on the drafts mentioned in the order, which were sold by J. T. Smith & Co. The case contained various other facts, but the foregoing statement embraces substantially all that is necessary for a proper understanding of the rights of the parties. The facts relating to the question of practice discussed by Jewett, J., are fully stated in his opinion.

      H. Denio for the appellant.

      F. Kernan for the respondent.
   Welles, J.

Assuming that on the 30th of April, 1845, when Newbury & Burch dissolved their copartnership at Chicago, Isaac H. Burch and Thomas Burch were joint owners of the two notes made by Newbury & Burch, and which I. H. Burch had shortly before taken up of the banks which had discounted them, and that I. H. Burch and Thomas Burch held them as creditors of the firm of Newbury & Burch, I am unable to perceive anything in the case to charge the firm of Newbury & Burch, or either of its members, in favor of the plaintiff, legally or equitably, with any part of the loss which subsequently arose upon the failure of the house of John T. Smith & Co. The firm of Newbury & Burch had been carrying on the business of exchange brokers at Chicago, and continued such business up to the time of their dissolution. An important branch, if not the principal part of their business, was selling sight drafts on the city of New-York and other distant places, and buying time drafts upon the same. It was indispensable to the success of such business that an agency be established in New-York provided with sufficient funds for the purpose of duly honoring and promptly paying their drafts. They had accordingly made arrangements with the house of John T. Smith & Co., of New-York, with that view. At the time of the transaction, when their partnership was dissolved, they had, as they supposed, in the hands of Smith & Co., funds for which they could draw at sight, to the amount of $3000, and drafts on time which they had purchased and forwarded to them for collection, and which would mature at various periods from the fifteenth of May to the thirteenth of June following, equal in value to $7961.48, which Smith & Co. were authorized to sell, if necessary to keep their accounts good, and against which they could also draw, if necessary. Smith & Co. were in good credit, paying all drafts which Newbury & Burch made upon them and had proved prompt and valuable correspondents. This firm was being dissolved, to be succeeded the next day by the new firm of I. H. Burch & Co., in the same business, at the same place. It would be natural, therefore, that Isaac H. Burch, who had been one of the old firm, and who was to be one and the active business member of the new firm, should desire to secure to the latter the advantages of these New-York facilities; and that he would regard the funds in the hands of Smith & Co. more beneficial to the new firm than the same amount of specie in Chicago. It is certainly not to be supposed that either Newbury or I. H. Burch considered these funds or this credit with Smith & Co. of any less value than that at which they were estimated in the transaction between them. Newbury was retiring from the business, and had no motive to retain an interest in them. The arrangement was accordingly consummated. The two $5000 notes were canceled, and the New-York funds transferred by Newbury & Burch to I. H. Burch & Co., and the next day the firm of I. H. Burch & Co., which then came into existence, took up the business as Newbury & Burch had left it, and carried it on, as they had done, with the house of Smith & Co., until that house failed on the sixteenth of the same month. Up to that day Smith & Co. were in full credit, paying all drafts properly made upon them. The $3000 draft of Newbury & Burch to the order of I. H. Burch & Co., and the order for the drafts previously sent by the former to Smith & Co. for collection, were received by Smith & Co., on the eighth or ninth of May, and the draft placed to the credit, on the books of Smith & Co., of I. H. Burch & Co. So far, all was satisfactory to I. H. Burch & Co. It was precisely what they wanted. With respect to the order, they did not desire to get the drafts to which it related out of the hands of Smith & Co. into their own, but wished merely to be placed in the same relation to them which Newbury & Burch had occupied, and to that end they directed J. T. Smith & Co. to hold them for collection for their account, as they had done for Newbury & Burch. There is no reason to doubt that Smith & Co. would have paid over to I. H. Burch & Co. the amount of chose sold if they had been requested to do so, and delivered the one which had not been sold, upon like request, any time after the order was made, and before they stopped business. But this I. H. Burch & Co. did not desire. They had no motive for changing their New-York correspondents and agents. If they had, there was time enough, after they received the order1, and before the failure of Smith & Co., to have done so. They retained Smith & Co., as their agents, voluntarily, and at their own risk. No fraud or bad faith is chargeable to Newbury, and there is nothing in the case to justify an inference that Newbury & Burch, or either of them, were expected, or intended, or did in fact in any way guarantee the responsibility of -Smith & Go.; and there is evidence which, to my mind, is abundant to show that Newbury & Burch were to be entirely discharged from the two $5000 notes; and if that was the understanding, there is nothing left of the plaintiff’s claim.

Admitting that the transaction at Chicago on the thirtieth of April, respecting the two 85000 notes of Newbury & Burch, and their draft and order on J. T. Smith & Co., is to be regarded as between I. H. Burch & Co. of the one part, and Newbury & Burch of the other, Isaac H. Burch is to be deémed as acting, and duly empowered to act, for himself and the plaintiff. It was, in substance, a purchase by I. II. Burch & Co. of the New-York city funds, with a view, to their future business, aud clearly within the scope of their partnership. No doubt can be entertained, that all the title and interest, both legal and equitable, of Newbury & Burch in and to the drafts mentioned in the order, or, if any of them were sold, in and to the proceeds of the sales in the' hands of Smith & Co., were, by force of the order and the concurrent acts of the parties connected with it, completely transferred to and absolutely vested in Isaac H. Burch and the plaintiff, who thereby succeeded to all the rights of Newbury & Burch to the drafts and their avails. The operation of the order was an equitable, and I think a legal, assignment to I. H. Burch and the plaintiff of the drafts specified in it, and their avails, in the hands of Smith & Co. The only guaranty on the part of Newbury & Burch which could on any principle result or be implied from the transaction, was, that the demand or thing assigned was what it purported to be, a valid, subsisting demand. Upon that subject, there is nothing in the allegations or proofs to show the contrary, or that any sufficient reason existed why Smith & Co. should not comply with the requirements of the order.

In case an action should become necessary against Smith & Co., to recover the drafts or their avails, or against the parties liable upon the drafts not sold to collect their amounts from such parties, Isaac H. Burch and the plaintiff would be the proper persons to make plaintiffs in such action. The order was not a bill of exchange, being drawn, not for money generally, but for the specific drafts mentioned ; or, in the alternative of the drafts or any of them having been converted into money, then for the payment of that money. A bill of exchange in its proper, legal sense, is for the payment, at all events, in money of a sum certain, and must not be in the alternative, or payable out of a particular fund; and in order to give the holder a right of action upon it, against the payee, must be accepted by the drawee. None of these characteristics appertain to the order in question. If it had been a bill of exchange, in the sense described, it would not have operated as an assignment of any funds in Smith & Go’s, hands, to I. H. Burch & Co., and the only way in which Newbury & Burch, the drawers, could have been made liable upon it would have been by a regular protest for non-acceptance or non-payment, or something equivalent thereto. I have remarked that Isaac H. Burch and the plaintiff would be the proper parties’ plaintiff in an action against Smith & Co. to recover the drafts or their proceeds. By this I do not mean that an action would lie in their favor upon the order, but that they could maintain it as purchasers and assignees of Newbury & Burch of the drafts, or the moneys received upon their sale by Smith & Co. It would have been the duty of Smith & Co., after they received the order, or had notice of it, to hold the drafts or their proceeds, if all or any of them were sold, in special deposit, subject to the order of I. H. Burch & Co.; and equity will hold, that what should have been was done — and if that was done, Smith & Co., would be regarded, in relation to the drafts or their proceeds, as holding the relation of bailees of I. H. Burch & Co. only, and none whatever to Newbury & Burch.

The case was ably examined in the supreme court, and the decision, dismissing the bill, was placed upon several grounds. The view I have presented seems to me to be the most favorable that can be taken for the plaintiff; and if I am correct, he has shown no ground for any relief against the defendant Newbury, who alone defends; and the bill, as to him, was properly dismissed.

I think the judgment of the supreme court should be affirmed, with costs.

Jewett, J.

On the argument the counsel for the defendant insisted that the court should review the order made by the supreme court, denying the motion made in that court in November, 1849, to dismiss the appeal in that court, it being an intermediate order involving the merits and necessarily affecting the judgment.

Preliminary to the argument on the merits, that question was discussed; but a decision of it was finally reserved, and the argument, on the merits of the cause, proceeded. It is proper, therefore, in the first place, to dispose of this question.

The facts in respect to it are substantially these: The suit was commenced in 1845, before the chancellor; was put at issue and the proofs closed by an order entered on the 30th day of June, 1847. On the second Monday of December, in the same year, it was brought to argument before the supreme court at a special term, when a decree was made therein dismissing the bill as to the defendant Newbury, with costs to be taxed, to be paid by the complainant, and was duly entered with the clerk of Herkimer county, and a copy thereof with notice of the same was served on the solicitor, for the complainant, on the 22d day of January, 1848. At a general term of the supreme court held in the fifth district in July, 1848, the complainant applied for a rehearing, which was denied, from which order he appealed to this court. In December term, 1848, the appeal was dismissed, with costs to be taxed, and on the 3d day of February, 1849, the decree was enrolled and docketed for the costs decreed, including the costs of the appeal to this court, amounting to $198.35, which subsequently in the same month was collected by an execution issued upon the decree.

On the 29th of June, 1849, notice of an appeal from the said decree so made at the special term, with the copy of an undertaking, was served on the solicitor for the defendant by the solicitor for the complainant, with a notice of argument for the then next general term appointed to be held in the fourth district on the first Monday in September then next, upon which the defendant’s solicitor gave notice of a motion to be made in the same court at the same time to dismiss the appeal. The motion was made, and at November term, 1849, was denied. (4 How. Pr. R., 145.) At January term, 1850, the cause was argued at the general term of the supreme court held in the fifth district, and at the next May term, that court made a decree affirming the decree of the special term, with costs: from that decree, the complainant appealed to this court. The supreme court was organized under the act “ in relation to the judiciary,” passed May 12, 1847 (Laws of that year, 319), and by § 16 of that act was vested with all the powers, which the late supreme court and court of chancery possessed. By § 24 of that act it was provided that a general term of the supreme court organized by that act, should be held at the capítol in the city of Albany, on the first Monday of July, 1847, and among other things, to “ establish, revise and alter the rules of said court.” By § 20 of said act, the right to apply at a general term for a rehearing of such a decree as was made at the special term in this case, was conferred on the complainant, but the time and manner of making such application, not being provided for by the statute, were left to be provided for and regulated by the rules of practice to be adopted by the supreme court at a general term to be held pursuant to § 24. I have already remarked that the supreme court thus organized was vested with all the powers which the late court of chancery and supreme court possessed. It had therefore the power to prescribe the time and manner of making such application. The provisions of 2 R. S., 1.75, § 46 ; 177, §§ 55, 57; 178, §§ 67; 200, § 28, were directly applicable to the present supreme court. That court, at a general term held pursuant to § 24, adopted rules of practice, and by the 78th rule it was provided that notice of an application for a rehearing before the court at a general term might be served at any time within thirty days after service of the decree or order complained of. The motion for a rehearing was made in July term, 1848, as I have before stated, and was denied on the ground that a notice of the application, specifying the time and place of making the motion, was not served until after the expiration of thirty days from the time of service of a copy of the decree and notice. The court held that the service of such notice was an irregularity, fatal to the application, although no delay in the hearing was the consequence of such omission.

By § 7 of the act to facilitate the determination of existing suits in the courts of this state, passed April 12,1848, which, with the exception of § 2, took effect on that day, it was provided, among other things, that no rehearing should be had at a general term of the supreme court, of an order or decree made at a special term, unless notice of the same should be given within two days after notice of the order or decree to be reheard. This provision is continued in § 7, of a similar act passed April lltli, 1849. (Laws 1849, 707.)

It was not claimed by the counsel for the complainant that the appeal from the decree made at the special term had been taken in pursuance of any of the provisions of the judiciary act of 1847, or of the act to facilitate the determination of existing suits to which I have referred, but under the provisions of § 460 of the Code as amended by the act of the 11th of April, 1849. {Laws of that year, 703.) That section provides that “ an appeal may be taken from any final decree entered upon the direction of a single judge, in any suit in equity, pending in the supreme court on the first day of July, one thousand eight hundred and forty-seven, within ninety days from the time this act shall take efiect; but this section shall not apply to cases where a rehearing has already been had or ordered, and such appeal shall be taken in the manner provided in section three hundred and twenty-seven and three hundred and forty-eight.”

On the part of the defendant it was contended that this section did not apply to this case, because the suit, in which the decree appealed from was made, was not pending in the supreme court on the day mentioned in the law; namely, the 1st day of July, 1847. That fact does not admit of any question, for no suit which was pending either in the late court of chancery or supreme court at the time the constitution of 1846 took eifect, was transferred to the present supreme court until the first Monday (which was the fifth day) of July, 1847. ( Const., art. 14, § 5.) It was, however, insisted that § 460 should be construed as applying to such suits, although they were not pending in the supreme court until the first Monday of July, 1847, notwithstanding the words of the act; on the ground that it was obvious that the legislature intended it to have that application. It is clear that unless it can have such application, it is wholly nugatory, for there was no suit pending in the supreme court on the day specified in the act, and of course there could not be any decree made in any such suit referred to. When the words of an act are doubtful and uncertain, it is proper to inquire what was the intent of the legislature; but it is very dangerous for courts to launch out too far in searching into the intent of the legislature, when they have expressed themselves in plain and clear words. It is well settled that in construing a statute the intention of the legislature is a fit and proper subject of inquiry. That intention, however, is to be collected from the act itself, and other acts, in pari materia.

The general rules on this subject require that such construction ought to be put upon a statute as may best answer the intention which the makers had in view, which may sometimes be collected from the cause or necessity of making the statute, and sometimes from other circumstances; and whenever such intention can be discovered, it ought to be followed with reason and discretion, in the construction of the statute, although such construction seem contrary to the letter of the statute. Where any words are obscure or-doubtful, the intention of the legislature is to be resorted to in order to find the meaning of the words. A thing which is within the intention of the makers of a statute is as much within the statute as if it were within the letter; and a thing which is within the letter of a statute, is not within the statute, unless it be within the intention of the makers ; and such construction ought to be put upon it as does not suffer it to be eluded. (Bac. Abr., tit., stat. 9, 5, 10; 2 Kent Com., 462; The Watervliet Turnpike Company v. McKean, 6 Hill, 616, and the cases there cited; Dwarris on Statutes, 690, 696, 703.)

The provision made for an appeal by § 460 is sensible if applied to decrees made in suits pending in the supreme court on the first Monday of July, 1847, but entirely senseless if applied to decrees made in suits pending on the Is? day of July in that year.

If we look into the several statutes passed by the legislature, to provide for the organization of the courts under the new constitution and for the subsequent proceedings in suits pending in the present supreme court after their transfer from the late courts, by force of the constitution, it cannot, I think, b& doubted, but that § 460 aimed at such suits, and that the mistake in referring to them—as to the day when they were so transferred, until which time no suit was pending in the present supreme court—was purely clerical; I am therefore of opinion that the provision contained in that section was applicable to this suit, although not pending in the supreme court until the first Monday, the 5th day of July, 1847.

It was next contended by the defendant that § 460 was void as having been passed by the legislature in violation of art. 1, § 10, subd. 1, of the constitution of the United States. The provision referred to, prohibits any state, among other things, from passing any ex post facto law, or law impairing the obligation of contracts.

The clause, “ that no state shall pass any ex post facto law, means nothing more than that the legislatures of the several states, shall not pass laws after a fact done by a person, which shall have relation to such fact, and shall punish him for having done it.

The object of the provision was not to secure persons in their private rights either of property or -contract. That provision is not applicable to civil laws, which affect private rights retrospectively, but to penal and criminal laws, which impose punishments or forfeitures, for acts indifferent in themselves when committed, by a law passed subsequently. Colder v. Bull, 3 Dallas, 386; Fletcher v. Peck, 6 Cranch, 138; Ogden v. Saunders, 12 Wheaton, 266; Satterlee v. Mathewson, 2 Peters, 380; Watson v. Mercer, 8 Peters, 110.)

The general interpretation has been, and is, as is said by the late Judge Stoby (3 Story Com. on the Const, of the U. S., § 1339), that the phrase, ex post facto laws, applies to acts of a criminal nature only; and that the prohibition reaches every law, whereby an act is declared a crime and made punishable as such, when it was not a crime when done; or whereby the act, if a crime, is aggravated in enormity, or punishment; or whereby different or less evidence is required to convict an offender, than was required when the act was committed. (1 Kent Com. 408.)

If the effect of the act in question was to divest Newbury of an antecedent vested right, but not to impair the obligation of any contract, it is not void as contrary to the constitution of the United States. For it is well settled that that instrument does not prohibit the states from passing retrospective laws, divesting antecedent vested rights of property, provided such laws do not impair the obligation of contracts, or partake of the character of ex post facto laws, however repugnant they may be to the principles of sound legislation. (Charles River Bridge v. Warren Bridge, 11 Peters, 539, 540.)

Under our form of government the legislature is not omnipotent, whatever the parliament of England may be in theory. It is only one of the organs of that absolute sovereignty which resides in the whole body of the people. It has the power, subject to the qualified negative of the governor, to pass any law which it may deem necessary for the public good, not inconsistent with the first principles of government, nor contrary to the provisions of the constitution of this state or of the United States.

It is a familiar principle in jurisprudence, that a statute shall not have a retrospective effect so as to destroy a vested right. (Mann v. Eckford’s Executors, 15 Wend., 519.)

The late Chancellor Kent says (1 Kent Com. 455, § 20), that a retrospective statute, affecting and changing vested rights, is very generally considered, in this country, as founded on unconstitutional principles and consequently inoperative and void. This doctrine, however, is not understood to apply to remedial statutes, which may be of a retrospective nature provided they do not impair contracts or disturb absolute vested rights, and only go to confirm rights already existing, and in furtherance of the remedy by curing defects, and adding to the means of enforcing existing obligations. I cannot assent to the doctrine supposed to be advanced in Butler v. Palmer (1 Hill, 324), that the legislature has unlimited power to interfere with vested rights, unless they be saved by some restriction to be found in the federal or state constitution. (1 Kent Com., 5 ed., 456, note A; Wilkinson v. Leland, 2 Peters, 657.) There is, unquestionably, a distinction between the obligation of a contract and the remedy given to enforce that obligation, and thus without impairing the obligation of the contract, the remedy may be modified as the wisdom of the legislature may direct, with the qualification that I have before mentioned.

In Dash v. Van Kleek (7 Johns., 477), Mr. Justice Spencer says, in reference to the power of the legislature, that he should undoubtedly deny that it could annul an existing judgment, because then there immediately arises a contract against the party adjudged to pay a sum of money in favor of him to whom it is awarded.

Previous to the passage of the act (§ 460) the defendant Newbury had obtained a complete and final decree against the complainant Burch, for the payment of a specific sum of money, and although there had existed, at the time of making the decree, a right in the complainant, for a time limited by law, to have the cause or matter in controversy between the parties, upon which the decree was made, reheard before the judges of the supreme court at general term, and an appeal from the decree that should be made by that court on such rehearing to the court of last resort — and a remedy full and complete to enforce such right—he allowed the time prescribed for pursuing his remedy to elapse without taking any steps to procure a rehearing; and thereby, as the law then stood, the decree obtained became indefeasible, completely vesting Newbury with the right to the money decreed to him which had been paid or collected of Burch, pursuant to the terms of the decree.

Thus situated, the legislature interfered; not to prescribe a rule for all future cases, but to provide a new remedy for the benefit of a class of persons to obtain a rehearing by appeal, in suits in which decrees had been made and become final against them, where the right to a rehearing at the time not only existed, but had been previously and intentionally abandoned—and thereby not only to impose upon the party in whose favor the decree was made, the expense and inconvenience of another hearing, but to subject all his rights and claims in the matters in controversy, which had been determined and become vested and absolutely fixed by the law then in force, to the uncertainty of future litigation, to be lost or saved as accident and opinion might afterwards happen to injure or befriend them.

The misfortune of having vested rights, under judgments and decrees of our courts, thus disturbed is far from being trivial, if we consider that on this principle no judgment whatever in a court of law can be rested upon as final.

But it was said by the learned judge on denying the application to dismiss the appeal brought under § 460, that the act was not unconstitutional; that it was merely a pro vision to extend the time for bringing an appeal; that it affected the remedy only, and did not impair the obligation of contracts or take away a vested right. Several cases were cited, and among them the case of Calder v. Bull (3 Dallas, 386), as being an express authority in affirmance of the constitutionality of the section referred to. I do not understand such to be the effect of the decision in that case. It was this: On the 21st of March, 1793, the court of probates for Hartford county disapproved of the will of N. Morrison, and refused to record it. No appeal was made from that decree in eighteen months, and by that neglect and a statute of Connecticut all right of appeal was barred. In May, 1795, the legislature of Connecticut passed a resolution or law, setting aside the decree, and granted a new hearing by the same court of probates, with a right of appeal in six months. A new hearing took place; the will was approved and ordered to be recorded ; an appeal was taken to the superior court of the state, who affirmed the decree; and on appeal from that court to the court of errors of Connecticut, it was affirmed. From that court it went before the supreme court of the United States, where it was contended on the one side that the said resolution or law of the legislature of Connecticut, granting a new hearing in the case before the probate court, was an ex post facto law, and as such contrary to the constitution of the United States, and therefore void. Whether the resolution or - law mentioned was within the provision of the federal constitution, prohibiting any state from passing any ex post facto law, was the sole question raised or decided in the case, and in respect to that, the court held that the prohibition applied only to criminal and not to civil cases. The resolution or law under consideration was viewed rather as a judicial than a legislative act; it being a mode of obtaining a new trial, authorized by the course of judicial proceedings in that state; that at all events, if it was to be considered a legislative act, not being an ex post facto law, within the meaning of the constitution, it did not belong to that court to declare it void. Chase, J., said that he was fully satisfied that that court had no jurisdiction to- determine that any law of any state legislature contrary to the constitution of such state, was void.' And further, if that court had such jurisdiction, yet it did not appear to him that the resolution or law, in question, was contrary to the charter of Connecticut, or its constitution, which was said to be composed of its charter, acts of assembly, and usages and customs.

Paterson, J.,

observed, that the legislature of Connecticut acted in a double capacity, as a house of legislation with undefined authority, and also as a court of judicature in certain exigencies; and he came to the conclusion that the legislature in that instance acted in its accustomed judicial capacity.

The direct effect of the act in question, if valid, is the granting of a new trial or hearing upon all the questions both of law and evidence arising in the case, after it had been lost by the neglect of the complainant under the provision of law as this existed at the time the decree was made and after it had become final upon the rights of the parties involved in the suit, and the defendant had acquired possession of the fruits of the litigation by due execution upon it. If the act is not invalid upon principles which I have endeavored to state, as I think it is, it seems to me that it is contrary to the clause in article 1, § 6, of the constitution of this state, which provides that “no person shall be deprived of life, liberty or properly without due process of law.”

The act assumes to create the means by which the complainant may open the decree for a reconsideration and adjudication upon the merits in controversy in the suit between the parties, irrespective of the present decree substantially, by another court having power to alter, modify or reverse the decree and to make a new decree adjudging money to be paid by the defendant to the complainant. In such an event, the money adjudged to and obtained by the defendant under the existing decree, would be taken from him and returned to the complainant, and the means provided by which—upon the contingency, that the appellate court shall come to a contrary conclusion upon the merits óf the controversy from that which the court, pronouncing the decree, came — it might and would be done.

It is in effect doing more than merely annulling a complete and final decree, by which property has been acquired and possessed. Contingently, it not only deprives such person of the property thus acquired, but compels him to pay to his adversary such sum of money as the appellate court may determine he ought to pay.

That the money adjudged to be paid by the decree and received by the defendant under it, was his property in a legal sense, at the time of the passing of the act, cannot admit of any doubt; he owned, had a legal title and was in possession of it.

It is true the act does not absolutely deprive the defendant of the money decreed to him, but it does contingently in effect. I think the provision contained in the constitution referred to, secures a person against being deprived of his property, either contingently or absolutely. If the appeal authorized to be taken by the act may result in depriving the defendant of his property, it is in my opinion contrary to the constitution.

It cannot be pretended that the words “ without due process of law,” used in the constitutional provision, mean a statute passed for the purpose of working the wrong. They cannot mean less than a prosecution or suit instituted and conducted according to the prescribed forms and solemnities for determining the title to property. (Taylor v. Porter, 4 Hill, 146, 147.) My opinion therefore is, that the order denying the motion to dismiss the appeal should be reversed, as also the decree appealed from, and the appeal be dismissed with costs. But if I am mistaken in the conclusions to which I have come, as above stated, I think the decree appealed from should be affirmed substantially for the reasons given by the learned judges who ordered the decree at the special term and affirmed it at the general term. (1 Bari., 648.)

All the judges concurred in the opinion of Welles, J., except Gardiner, J., who disssented.

Decree affirmed.


author: Ruggles, Ch. J.,

text:
    Sheldon against Paine.
    The sheriff is not discharged from liability for the acts and omissions of his deputy in consequence of the interference of a party to divert the deputy from the line of duty imposed by law, unless the deputy follows or undertakes to follow the instructions of the party so interfering.
    Where therefore the plaintiff, in an execution, authorizes a deputy sheriff to give credit for goods purchased at the sale upon receiving indorsed notes, payable in a particular manner, the sheriff is responsible for the value of goods sold by the deputy upon credit, without any security.
    The testimony of the deputy is not admissible to contradict his return on the execution. Such return, though made by the deputy, is the act of the sheriff, and conclusive between him and the plaintiff of the amount of money made on the writ.
    Appeal from the supreme court. Action against the " sheriff of Washington for moneys alleged to have been collected upon an execution in favor of the plaintiff. Upon the trial at the Rensselaer circuit before Mr. Justice Habéis and a jury, the plaintiff- proved a judgment and an execution thereon, with a return signed by one Meecham, the defendant’s deputy, that he had made $660.95; of which $500, it was admitted, had been paid over to the plaintiff. The defendant proved by the deputy Meecham, under exception by the plaintiff, that Meecham had charge of the execution; that after he had made a levy and advertised the property for sale, one Root came to him as agent of the plaintiff, and exhibited to him a paper signed by the plaintiff to this effect: “Mr. Root will report himself to the sheriff, Mr. Meecham. I wish Mr. Root to take good care that property is not sacrificed, and bid off such article^ for my benefit as he may think advisable. The sheriff may give 3 mo. credit on all amounts over $50, and 4 mo. on all sums over $100, for good indorsed notes at the Bank of Whitehall.” It also mentioned Messrs. Gibson and Davis as persons whom he had requested to see to the matter of the sale in his behalf, by letter not then answered, and continued if “Mr. Gibson or Davis will give this matter their attention and watch my interest, any reasonable bill for such service will be paid.”
    Meecham further testified, that in pursuance of the authority of this paper he sold goods to the value of $75 to one Gilmore, and took his note without any indorser, esteeming him amply responsible. He also sold goods to Davis, and to Burdick, the defendant in the execution, to the amount of $85.95, understanding from both that Burdick bid on behalf of Davis; he had not received payment for these goods when he made the return.
    It was proved by Root that he took the paper before mentioned, and exhibited it to Meecham as evidence of his (Root’s) authority to bid in behalf of the plaintiff, without any instructions to deliver it to him, and that it was retained by Meecham without his consent. Root gave no direction, to give credit on the sale.
    The judge nonsuited the plaintiff, on the ground that by his instructions to the deputy to depart from his duty and give credit, the latter ceased to be the servant of the sheriff and became the agent of the plaintiff, and that by his departure from the terms of the authority, the deputy made himself liable to the plaintiff but did not revive the liability under which the sheriff would have been in the absence of the plaintiff’s interference.
    The judgment was affirmed at general term in the third district, and the plaintiff appealed to this court.

      N. Hill for the appellant.

      A. Taber for the respondent.
   Ruggles, Ch. J.,

delivered the opinion of the court. The return endorsed on the execution is conclusive between the plaintiff and the sheriff for the purpose of showing the amount of money raised by the officer on that writ.

The return, although made by the deputy in the sheriff’s name, is the act of the sheriff, and when the question comes up directly between one of the parties to the execution and the sheriff, the latter is not permitted to gainsay it. (Townsend v. Olin, 3 Wend., 207; Gardner v. Hosmer, 6 Mass., 327; Harris v. Small, 22 Maine Rep., 14; Purrington v. Loring, 7 Mass., 392; Doly v. Turner, 8 Johns., 20; Barret v. Copeland, 18 Vermont Rep., 69; Paxton v. Stickel, 2 Barr, 93.)

The evidence given by the deputy went substantially to impeach the truth of the return ; and, having been objected to, should have been excluded.

The plaintiff was nonsuited on the trial, on the ground that by giving authority to the deputy to sell on a credit, he made the deputy his agent and released the sheriff from liability for his acts or defaults.

The deputy was authorized to give three months credit on all amounts over $50, and four months on all sums over $100 for good endorsed notes payable at the bank of Whitehall.

But the deputy neither acted in the line of his duty, as prescribed by law, nor did he obey the directions, or act within the authority given him by the plaintiff.

It does not appear that the goods sold by the deputy to Gilmore, Davis and Burdick, respectively, were sold on a credit of three or four months in pursuance of the plaintiff’s authority, or that they were sold on a credit at all. These purchasers were permitted to take away the articles they purchased without paying for them; but there is no evidence that a credit was to be given by the terms of the sale, or by any agreement made at the time of the sale. The deputy testified that he could not tell what terms of sale were announced, or whether any terms were mentioned. If no terms were announced and no agreements made to give time, the sales were certainly not on credit; and yet the deputy delivered the goods without receiving the money bid for them, and without receiving the endorsed notes required by the plaintiff as the condition on which he might sell on credit. The deputy, moreover, delivered the goods purchased. by Davis and Burdick without obtaining payment, against and in violation of the direction repeatedly given by Boot, who is acknowledged by the deputy in his letter of October 1, to have been the plaintiff’s agent at the sale.

The plaintiff is not answerable for having made the deputy his agent, when in fact the deputy did nothing in conformity with his instructions. He was certainly not the plaintiff’s agent for the purpose of selling for cash and then parting with the property without requiring payment of the money. Nor was he the plaintiff’s agent to sell on credit, except on the condition of taking endorsed notes for the amount purchased. The taking of such notes was the only condition on which he was authorized by the plaintiff to depart from the line of his legal duty by selling on credit! In Gosham v. Gale (6 Cow., 467, and 7 Cow., 739), the deputy followed the instructions given by the plaintiff and the sheriff was held to be discharged from liability on the ground that the plaintiff had made the deputy his agent. In Corning v. Southland, sheriff, &c. (3 Hill, 552), the deputy failed to comply with the terms on which he was authorized by the plaintiff’s attorney to let an execution lie over beyond the return day, and the sheriff was held responsible for not having returned it.

For the purpose of discharging the sheriff from liability for the acts of his deputy, it must be shown not only that the plaintiff directed the deputy to depart from the line of. duty imposed by law, but that the deputy followed or at-least undertook to follow the directions given. He cannot otherwise be regarded in any respect the agent of the plaintiff. In the present case he appears to have paid no regard-to the plaintiff’s instructions and therefore the sheriff is responsible.

Judgment reversed, and a new trial ordered, with costs to' abide the event.