text:
    Harris Wilson, Plaintiff and Respondent, v. John Davol, Defendant and Appellant.
    1. A judgment between two persons, determining the title to land which both claim, makes part of the title, runs with the land, and concludes all who derive a title to such land from either of those parties, subsequent to the recovery of such judgment.
    2. But it does not bind any person who derives a title from either by a deed or lease executed prior to the commencement of the action in which such judgment was recovered.
    3. The perfection of a title, by purchase at a Sheriff’s sale on judgment and execution, extinguishes a lease given by the judgment debtor between the time of the Sheriff’s sale and the execution of the Sheriff’s deed.
    (Before Bosworth, Oh. J., and Hoffman and Moncrief, J. J.)
    Heard, December 14;
    decided, December 31, 1859.
    This is an appeal by John Davol, the defendant, from a judgment in favor of Harris Wilson, the plaintiff, rendered on a trial had before Mr. Justice Slosson, without a jury, on the 23d of April, 1857.
    The action is brought to recover rent of the house and lot Ho. 50 Harrison street, Brooklyn, for three quarters, ending, respectively, Hovember 1, 1849, and February 1 and May 1, 1850; which rent the plaintiff claimed as assignee of a lease of the premises from Jacob Carpenter to the defendant, (dated July 22,1848,) for two years from the 1st of May, 1848, and also as owner of the premises under a title acquired September 18, 1849, at a purchase thereof on a foreclosure by advertisement of a mortgage thereof executed by said Carpenter to one Sarah Loines on the 2d of December, 1844. The allegations of the pleadings, as to such mortgage and its foreclosure, are stated in the opinion of the Court.
    The lot 50 Harrison street is mainly on a lot numbered 75 on a map produced at the trial, and is partly on the adjoining lot, having the map number 76.
    The lots, map Hos. 75 and 76, were sold by the Sheriff of Kings county on judgments (being liens thereon) and executions against said Jacob Carpenter on the 15th of December, 1847, and were conveyed by the said Sheriff, by a deed dated March 16, 1849, to Sylvanus B. Stilwell, as a judgment creditor of Carpenter, who had duly redeemed the premises so sold.
    Davol claimed to hold under said Stilwell from and after the 1st of May, 1849, and refused to pay rent to Carpenter subsequently thereto. It was found, as a fact, that Davol was notified by Stilwell of the said conveyance to him from the Sheriff' two or three days after it was delivered, and then agreed to pay, and subsequently did pay, to Stilwell the rent of the premises until the expiration of said lease.
    On the 7th of May, 1850, Carpenter assigned said lease to the plaintiff, and all rents accruing under it since October 1, 1849.
    On the 14th September, 1850, an action was tried in the City Court of Brooklyn, between the said Jacob Carpenter, plaintiff, and the said Sylvanus B. Stilwell and Isabella Ambrose, defendants, for the recovery of the possession of a lot of ground in Court street, Brooklyn, one of the pieces of property described in said deed of the 16th March, 1849, from the Sheriff of Kings county to said Stilwell. In that action the validity of said deed was passed upon, and the same was adjudged to be void, and judgment was rendered for the plaintiff in said action; which judgment was subsequently affirmed by the Court of Appeals.
    To prove the fact of such recovery, and thereby to establish the invalidity of said Sheriff’s deed, the plaintiff produced the record of the judgment in the last named action, and the defendant objected to its admissibility as evidence, and excepted to the decision admitting it. Thé record did not show when such'action was commenced. The summons in it is dated “ August, 1849 the complaint in it is verified August 6, and the answer August 31, 1849. It was tried September 14, and judgment was perfected November 14, 1850. That judgment was affirmed by the Court of Appeals in 1854.
    The Judge, on the trial of this action, held that Stilwell acquired no title under the deed of the 16th of March, 1849, “ and that the defendant is bound by the aforesaid decision (of the City Court of Brooklyn) in relation to said deed;” to which decision he excepted.
    The printed Case states the reversal by the Supreme Court of the judgment of the City Court of Brooklyn, and refers to Carpenter v. Stilwell, (12 Barb., 128;) and also states the reversal by the Court of Appeals of the judgment of the Supreme Court and affirmance of that of the City Court of Brooklyn, and refers to Carpenter v. Stilwell. (1 Kern., 61.)
    • Judgment was given for the plaintiff for the three quarters’ rent, with interest and costs; and from that judgment the present appeal is taken.

      J. Greenwood, for appellant.
    1. The complaint alleges that the lot No. 75, embracing nearly the whole of the demsied premises, was sold to the plaintiff under foreclosure of a mortgage made by Carpenter prior to the lease to .the defendant Davol. This sale extinguished the lease as to all of the demised premises comprised in that lot. (Simers v. Saltus, 3 Denio, 214.)
    The plaintiff, having alleged this fact in his complaint, cannot now deny it for the purpose of enabling him to recover upon the ' lease.
    II. After the foreclosure and sale of the mortgaged premises, no relation of landlord and tenant existed as between Carpenter, the lessor, and the defendant Davol, and the assignment of the lease in May, 1850, by Carpenter to the plaintiff, carried with it no right to recover rent claimed to be due on and .subsequently to November 1, 1849.
    III. The title of Stilwell, under the Sheriff’s deed of the whole of the premises, was perfect, and thé attornment by the defendant to him was therefore legal. The only evidence offered to impeach this is the judgment roll in the case of Carpenter v. Stilwell and Ambrose, in the City Court of Brooklyn, which is not evidence against the defendant in this case. (Jackson v. Rowland, 6 Wend., 666; Nellis v. Lathrop, 22 id., 121.)
    1., It is a record of a judgment on ejectment for other premises, and between other parties. (Lawrence v. Hunt, 10 Wend., 80; Jackson v. Wood, 3 id., 27; Snyder v. Sponable, 1 Hill, 567.)
    2. It does not appear from the record itself, nor from any proof aliunde, that the validity of the Sheriff’s deed was passed upon. (Gardner v. Buckbee, 3 Cow., 120; Burt v. Sternburgh, 4 id., 559; 10 Wend., 84; 1 Greenl. Ev., §§ 528, 529.)
    The judgment should be reversed.

      J. W. Gilbert, for respondent.
    I. The plaintiff, as the assignee of the lease, is entitled to recover any rent that became due subsequent to the 1st of October, 1849, although his title to the reversion accrued subsequently. (2 R. S., 4th ed., 154, § 17.)
    1. This assignment was valid. It is an assignment of the agreement to pay the rents, &o.
    There was no adverse possession: Davol was in possession under his lease from Carpenter. He claimed in no other way. Although Stilwell had acquired the Sheriff’s deed, he never took possession, or attempted to take possession. The case shows that an arrangement was made by which Davol was to pay him the rent. The lease was recognized, and hence the rent was agreed to be paid upon being indemnified.
    2. Carpenter had a valid claim for the rent due upon the lease, except so far as the plaintiff had acquired it by his purchase of the premises.
    Stilwell, by his purchase, or under the Sheriff’s deed, acquired no right whatever. (Carpenter v. Stilwell, 1 Kern., 61.)
    3. The plaintiff, therefore, as assignee of Davol’s agreement, became entitled to all the rent falling due subsequent to 1st October, 1849. For this he recovered against Davol, and that recovery should not be disturbed.
    4. The attornment to Stilwell was a nullity. (3 Denio, 216; 2 R.S., 3d ed., 29, §3.)
    II. The judgment in the City Court was a perfect estoppel.
   By the Court—Bosworth, Ch. J.

The defendant cannot claim on this appeal that the mortgage on lot Ho. 75 had been foreclosed, and the lot purchased by the plaintiff, prior to the accruing of the rent which this action is brought to recover.*

Ho such fact is found by the Court nor was proved at the trial; no such fact is admitted by the pleadings.

It is true that the complaint alleges the making of the mortgage ; default of the mortgagor; a foreclosure of the mortgage, and a purchase of lot Ho. 75 by the plaintiff. But the defendant in his answer controverts the allegation of the mortgagor’s default, and charges that the mortgagee, (in the endeavor to foreclose by advertising under the statute,) did not advertise according to the statute, “ and that notice of such sale was not duly advertised."

Such being the pleadings, and no evidence having been given of any proceedings to foreclose, the case stands as if the fact of such a foreclosure had not been alleged.

The lease from Carpenter to Davol was for two years from the first of May, 1848. This action is to recover three quarters rent of the premises, ending November 1, 1849, and February 1, and May 1, 1850. This lease and the rents due from Davol as such lessee have been assigned to the plaintiff.

Davol resists the plaintiff’s claim on the ground that lot No. 75 and the adjoining lot had been sold by the sheriff of Kings county, on executions against Cárpenter, issued on judgments recovered prior to the date of the lease from him to Davol, and that S. B. Stilwell received, as a judgment creditor redeeming from the purchaser at said sale, the Sheriff’s deed on the 16th of March, 1849. That Davol, subsequently thereto paid rent to said Stilwell, as the owner of lot No. 75, by a title thus acquired.

To this it is answered, that in September, 1850, an action was tried which Carpenter had commenced against Stilwell, to recover the possession of another lot in Brooklyn conveyed by the Sheriff’s deed before mentioned and sold under the same executions as the one in question; that the validity of such deed, and of the title thereby acquired, was a point in judgment; and that it was held to be invalid.

The Court at Special Term found these latter facts to be true. As we read the case, Carpenter v. Stilwell, (12 Barb., 128, and 1 Kern., 61,) and the reports thereof, were read in evidence by consent, for the purpose of showing thereby what questions were litigated and determined in that action.

If this view be correct, these reports show that the act of the Sheriff in selling upon the executions on which the sale was made, which is the basis of Stilwell’s title, and the deed given to carry such sale into effect, were adjudged to be without authority and void.

The only material question left is, whether the judgment in the suit between Carpenter and Stilwell, and the trial and determination of those questions in that suit, are conclusive against Davol in this suit, that Stilwell had no title.

■ ' The Court held, as a conclusion of law, “ that the defendant is bound by the aforesaid decision in relation to said deed.” To this decision the defendant duly excepted.

The Sheriff’s deed to Stilwell is dated on the 16th of March, 1849. Davol claimed to hold under Stilwell from and after the 1st of May, 1849, and refused to pay rent to Carpenter subsequently thereto.

■ The action between Carpenter and Davol, in which it was determined that the deed of the 16th of March, 1849, was void, was tried on the 14th of September, 1850. It was not found at Special Term when that action was commenced. The summons in it is dated “ August, 1849,” and the complaint in it was verified “ August 6, 1849.” It may be assumed, therefore, that it was commenced after the 1st of August, 1849, several months subsequent to the time when Stilwell apparently acquired the legal title, and several months after Davol recognized him as the owner and agreed to pay rent to him.

To make the judgment in the action between Carpenter and Stilwell evidence against Davol in the present action, it is indispensable that the former action should have been commenced, if not determined, prior to the time when the agreement between Stilwell and Davol was concluded, and the rights which the latter acquired thereby had become fixed. (Campbell v. Hall, 16 N. Y. R., 580.)

The act, or proceeding, relied upon as an estoppel, must have been done, or been had, prior to the time when the defendant acquired the title which is claimed to be affected and bound thereby.

■A judgment between any two parties, determining the title to land which both claim, makes part of the title, runs with the land, and concludes all who derive a title to the land from either of those parties subsequent to such judgment. But it does not bind any person who derives title from either, by a deed or lease executed prior to the commencement of the action in which such judgment was rendered. (Campbell v. Hall, supra, and the cases there cited.)

It was, therefore, erroneous to hold that the judgment in the action of Carpenter against Stilwell and Ambrose bound Davol.

The title of Stilwell under the deed of the 16th of March, 1849, assuming it to be valid, extinguished the title of Davol 'as lessee of Carpenter. That lease was made after the sale by the Sheriff _ of the premises thus leased. The sale by the Sheriff was made on the 15th of December, 1847, by virtue of executions on judgments docketed the 11th of March, 1846.

Stilwell, having become the absolute owner, by virtue of the Sheriff’s sale and Sheriff’s deed, had a right to the immediate possession of the premises; and Davol might lawfully agree to occupy as his tenant and to pay rent to him.

The Judge at Special Term did not find, as a fact, that the Sheriff’s deed was void, nor was any evidence given upon that point beyond the introduction of the record in the suit between Carpenter and Stilwell, and proving that in such suit it was adjudged to be void.

In the present action it is open to the parties to litigate that question upon such competent evidence as either may offer; and the defendant is not bound by the decision and judgment in the action between Carpenter and Stilwell. (Thomas v. Hubbell, 15 N. Y, 405-409.)

It follows that the judgment must be reversed, and a new trial granted, with costs to abide the event.

Ordered accordingly.


source: Caselaw Access Project

author: Slosson, J. Hoffman, J.

license: Public Domain

text:
    Ebenezer K. Lakeman and others, Plaintiffs, v. Moses H. Grinnell and others, Defendants.
    1. When goods were purchased in Connecticut by persons doing business at Liverpool, England, to be delivered by the vendor on ship board in New York, and were so delivered on board the defendant’s ship, then bound for Liverpool, and were received by the defendants for transportation to Liverpool, and a receipt given therefor specifying the price of freight; but before bills of lading were delivered or executed, and before the ship sailed, she was destroyed by an accidental fire at the wharf without any actual negligence of the defendants, and the goods were burned: Held, that the defendants were liable as common carriers for the loss of the goods.

      2. The measure of damages where goods are lost before the ship of the carrier leaves the port of lading, is the value of the goods at that port, and the plaintiff is not entitled to the value at the port of destination less the cost of transportation.
    3. Where goods intrusted to a common carrier for carriage, are lost by accident without any actual negligence on Ms part, the plaintiff is not entitled to recover interest on the value of the goods, not even from the time of the commencement of suit.
    (Before Hoffman and Slosson, J. J.)
    Heard, November 14th;
    decided, December 31st, 1859
    Action to recover from the defendants, as common carriers, the value of goods destroyed by fire, after delivery to the defendants for carriage.
    The plain tiffs purchased at New Haven, Connecticut, a quantity of India rubber slippers and sandals to be shipped to them at Liverpool, in England, the vendor to deliver them on ship board at the city of New York.
    The vendor forwarded the goods to New York, addressed to the plaintiffs at Liverpool, and his agents delivered them on board the ship Henry Clay, belonging to the defendants, then bound for Liverpool, and the same were shipped on the 3d and 4th days of September, T849; the agent of the defendants received the same on board to be carried from New York to Liverpool, and delivered a receipt therefor specifying the price of freight. The ship was at that time employed by the defendants in the transportation of goods for hire between New York and Liverpool, in England, and they had then advertised her as up for freight and passage on a voyage to Liverpool.
    On the next day, (September 5th,) and before any bills of lading for the goods had been delivered or executed, the ship was destroyed by fire at the wharf, and the plaintiff’s goods were totally destroyed. It was conceded that the plaintiffs had no proof of actual negligence, and did not charge the defendants with actual negligence by reason of which the fire occurred.
    The value of the goods in New York was at that time $4,685.27.
    The value of the goods, in. Liverpool, the port of destination, was $8,054.18; the amount of the freight and duty which should be deducted if that valuation was decided to be the measure of damages was agreed upon.

      ■ The case had been previously tried, and on appeal to the Court of Appeals, that Court decided that the defendants were liable under such circumstances as common carriers, although the loss occurred from fire, which was purely accidental, and- happened' before the voyage was begun and before bills of lading were signed.
    The present trial was to determine the amount which the plaintiffs were entitled to recover, and was had before Mr. Justice Slosson and a jury, on the 20th of May, 1859.
    The plaintiffs’ counsel requested his Honor, the presiding Justice; to charge the jury that the plaintiffs were entitled to recover the value of the said goods at the port of destination, with interest.
    The said Judge refused so to charge, and the plaintiffs’ counsel duly excepted.
    The said Judge then charged the jury that, inasmuch- as no fault was imputed to the defendants, and the goods were destroyed before the departure of the ship, and this was known to the plaintiffs, that the plaintiffs were only entitled to recover the value of the said goods at the port of New York; to which charge the said plaintiffs’ counsel duly excepted.
    The said Judge further charged the said jury, that the said plaintiffs were not entitled to recover interest on the value of the said goods; to which charge the plaintiffs’ counsel also duly excepted.
    The jury then rendered a verdict for the plaintiffs for the sum of $4,685.27.
    His Honor the Judge, then directed the said exceptions and all the questions of law to be heard in the first instance at a Greneral Term, on a Case to be made, with leave to either party to turn the same into a bill of exceptions.

      Richard Goodman, for plaintiffs.
    I. By the decision of the Court of Appeals, affirming the law as it has existed for centuries, the defendants were common carriers, and responsible for the loss of the plaintiffs’- goods.
    They advertised to carry goods for hire, from New York to Liverpool, England, and received the plaintiffs’ goods for such voyage.

      II. The measure of damages is the value of the goods at the port of destination, at the time they would have arrived, with interest.
    Such value was proved on the trial. (Sedgwick on Meas, of Damages, 370; Gillingham v. Dempsey, 12 S. & R., 188; Watkinson v. Laughton, 8 J. R., 213; Elliott v. Rossell, 10 id., 1; Bracket v. McNair, 14 id., 170; Amory v. McGregor, 15 id., 24; Dana v. Fiedler, 2 Kern., 40; Joshua Baker, 1 Abb. Ad. R., 215; Gold Hunter, 1 Blatch. & H., 310.)
    III. The verdict should he set aside, and a new trial granted.

      Daniel Lord, for defendants.
    1. 1. Where, by an event importing no fault, the ship and goods are lost at the place of lading, the cost price or value at that place is the measure of the liability of the carrier. (Wheelwright v. Beers, 2 Hal l R., 391; Smith v. Richardson, 3 Caines R., 219; See also from Spencer, 8 Johns. R., 215; Watkinson v. Laughton.)

    2. The cases where the rule adopting the price at the port of destination is applied are uniformly cases where the voyage has been proceeded on, and the goods carried away from the port of lading. (Watkinson v. Laughton, 8 John. R., 213; Elliott v. Rossell, 10 id., 1; Bracket v. McNair, 14 id., 170; Amory v. McGregor, 15 id., 24.)
    3. When the ship and cargo are both lost before proceeding on the voyage, the cost or home value is the only certain rule, and it affords an exact indemnity.
    To give the value abroad involves speculative inquiries into price abroad, without the presence of the goods themselves, into the time of probable arrival abroad, into the fluctuations of the ■current market, into the duties abroad, and into the foreign charges.
    But the domestic value rests upon the actual cost, ascertainable by direct positive evidence, and is the sum with which the lost goods may be replaced.
    II. 1. Where a carrier is held liable, the allowance of interest is in the discretion of the jury, and not a legal right in the shipper, where there is any question of negligence.
    And where there is no question of negligence made, interest ■is not by law to be allowed. (Watkinson v. Laughton, 8 Johns. R., 213; Bracket v. McNair, 14 id., 170; Amory v. McGregor, 15 id., 24; Richmond v. Bronson, 5 Denio R., 55; Sedgwick on Damages, 357, 2d ed.)
    2. This is in conformity with the law in the allowance or not of interest on unliquidated demands, in the absence of fault or agreement to pay interest. (Rensselaer Glass Factory v. Reid, 5 Cow., 587; Doyle v. St. James Church, 7 Wend. R., 178 Tucker v. Ives, 6 Cow. R., 193; Van Beuren v. Van Gaasbeck, 4 id., 496.)
    3. The liability of the carrier for a loss like the one in question, is founded on mere positive law, similar to a statutory penalty or liability. It is not founded on equitable considerations, and is now limited by act of Congress. (U. S. Stat., March 3, 1851.)
    Nothing is to be added to it by any implication.
    The verdict should not be set aside.
   Slosson, J.

1. There is no question on the authorities but that the common carrier who has received goods for transportation "and has actually performed the journey or voyage, is, in case of non-delivery of the goods, unless the failure to deliver is excused by the act of God, or perils of the sea, liable, as a general rule, for the value or price which they would have brought at the port or place of destination, if they had been delivered according to the contract.

The defendants’ counsel, however, insists that it would be unreasonable to adopt the valuation at the place of destination, when the goods have never left the place at which they were received by the carrier, but have been destroyed at such place by some cause other than the carrier’s own negligence, and insists that in such a case the value of the goods, at the place where they were received by the carrier, is the true rule both in principle and on authority.

The case of Wheelwright v. Beers, (2 Hall’s Sup. Ct. R., 391,) is relied on. The defendant had undertaken to transport the plaintiff’s goods from New York to Omoa, the vessel was forced by stress of weather into Norfolk, where she was found so much damaged that she was sold and the voyage broken up. A part of the plaintiff’s goods was also sold, and the residue shipped back to him at Hew York and there sold. The loss on these sales was $1,000. On the trial the plaintiff proved what the goods would probably have brought at Omoa, and contended that he was entitled to recover according to such foreign valuation. Chief Justice Jones who tried the cause reserved the question of damages for the consideration of the Court, and the jury, under the direction of the Judge, assessed both values, that is, first, the difference between the invoice prices of the articles shipped and the net amount of the sales of the same articles after they were delivered to the plaintiff; and, second, the difference between the net amount of said sales and the prices which the articles would have brought at Omoa. The first they found to be $1,000 and they estimated the loss of the market at Omoa to be $1,500, and gave a verdict for the plaintiff for $2,500. When the case came before the Court in Bench, Judge Oakley gave an opinion in favor of the valuation at the place of destination. The Court, however, did not agree with him, and the Reporter adds: “ That part of the foregoing opinion which relates to the rule of damages was the opinion of Judge Oakley merely, and not that of the Court. The Court gave judgment in favor of the plaintiff for $1,000, being the difference between the actual sales and the invoice price of the goods, the loss of the market at Omoa being deducted from the verdict of the jury. The loss on the sale of the goods at Horfolk and Hew York was considered as the true rule as to damages, upon the ground that there was •no fault or fraud on the part of the defendant from which the loss arose, and that the case showed only a breach of the implied warranty of sea-worthiness.”

This case is important, not only as showing that>the valuation at the port of departure may be a proper measure of damage, even where the vessel has undertaken and partly prosecuted the voyage, but as also showing that in cases of this nature, where the action essentially sounds in damages, the good conduct or fault of the carrier may enter into the consideration of whether the valuation should be fixed according to the home market, or the market at the port of destination.

The case of Smith & Delamater v. Richardson, (3 Caines, 219,) is also relied on. It was brought to recover damages for the breach of the defendant’s contract, he having undertaken to convey the plaintiffs’ goods, consisting of staves, from a point in the State of New York to a place near Montreal, in Canada, and wholly failed to perform his agreement, by reason of which the plaintiff had been obliged to effect the transportation himself, in the course of which the goods were lost on the St. Lawrence. The Referees, to whom the case had been sent, gave the plaintiff the full value of the property which it would have brought in the Montreal or Quebec market; and on a motion to set aside their report, it was contended that at the utmost the defendant could only be made liable for the value of the staves on the spot where they lay and so the Court held, putting their decision on the ground, however, that the price in the Montreal or Quebec market was “ too uncertain and unreasonable to be admitted as a rule of damages.”

In Watkinson v. Laughton, (8 Johns. R., 213,) where goods had been embezzled during the voyage, and in which the valuation at the place of delivery was held to be the rule, the case of Smith & Delamater v. Richardson was relied upon as conclusive on the rule of damages; but the Court held that case not to be applicable, “ as that was not a case of loss arising from the fraud, negligence or misfortune of the carrier in the performance of his trust, for the defendant there never entered on the undertaking, and the suit was for a breach of contract in not carrying, and the plaintiffs afterwards became their own carriers and lost the goods,” and they held that there might be a material difference between the two cases as to the reason and policy of the rule of damages, the case before them being one of embezzlement of part of the goods in the course of the voyage.

The case of Dusar v. Murgatroyd, (1 Wash. C. C. R., 13,) resembles the one now before us most nearly in its circumstances. After the goods had been put on board for a foreign port, and before the vessel left the wharf, she nearly filled with water, in consequence of which the plaintiff’s goods were damaged to about one-half their value; 'and the Judge charged the jury that the rule of damages was the difference between the prime cost and charges, and the sales at the place of shipment.

In the case of Bridge v. Austin, (4 Mass. R., 115,) the defendant had received the plaintiff’s, goods on board his vessel at Boston, to transport to Charleston, under a special agreement to sell on his account and to account for the proceeds. The goods arrived at Charleston, and were there stored by the defendant, but before they were sold were stolen. The rule of damages adopted by Chief Justice-Parsons, was the value of the goods at Boston when shipped, less the five per cent commissions stipulated for in the special agreement.

I should be unwilling to make the negligence or good conduct of the carrier the sole test by which to determine the measure by which to assess the plaintiff’s damages in a case of this kind. Apart from the difficulty of proving negligence or fraud on the part of the carrier, the burden of doing which would, by such a rule, be thrown on the plaintiff—an objection pointedly alluded to. by the Court, in Watkinson v. Laughton—it would be introducing as decisive, in- the computation of damages, a consideration which, if properly admissible at all, which I do not deny, is nevertheless not necessarily connected with the principal, if not the only object of damages in such a case, to wit, pecuniary indemnification to the plaintiff for his loss..

The case of Delamater & Smith v. Richardson does not adopt such a test, though the.Court in Watkinson v. Laughton, refer to the absence of fraud, negligence or misfortune, in that case, as one of the distinctions between it and the case then before them.

The true test, I apprehend, is what will furnish the plaintiff a full indemnity. If the value of the articles, according to the invoice price, will fully compensate for the loss, that price should govern. -If the value in the place where the goods were to be delivered is necessary to furnish a complete remuneration, that should be adopted; and hence the question whether the goods are lost in the place where they are received by the carrier, or in the place at which they were by the contract to be delivered, may become one of the last importance. I say may become, because I do not.think that that is necessarily decisive in all cases; for I can well imagine a case in which the goods are lost in the port of departure, in which, from an impossibility of procuring other articles of the same kind, or from other causes, the value at the port of .destination would furnish the only adequate indemnity to the plaintiff. In such a case it ought, except under special circumstances, to be adopted. But if the goods could b.e immediately replaced at the same -price, and sent forward by another vessel, it would he unreasonable to give the plaintiff the profits he might have made if the goods had not perished and the first shipment had been successful.

This furnishes a safe and a righteous rule, and divests the question of damages of the penal character which it would have if the good conduct of the carrier were the sole test. This is the reason why, when the vessel has arrived at the port of destination, the value of the missing goods at that place is adopted. No other rule could compensate. So, if the vessel should perform but a portion of her voyage, and the goods are sold or lost by act of the carrier at an intermediate port, as in the case of Wheelwright v. Beers, in 2 Hall’s Reports, the value at the port of destination might well be given if the plaintiff was unable to replace the goods at the intermediate port and forward them on; as, on the other hand, the invoice price which was adopted in that case would be proper, if, under the peculiar circumstances of the case, that would furnish a complete indemnity.

It follows that whether the carrier has been guilty of negligence or fraud, is not the only test, nor whether the voyage has been begun or not; but whether the market price at home, or the price at the port of destination, furnishes the true and perfect indemnity, and this may depend on a variety of circumstances.

The cases which are cited to prove that the valuation at the place of delivery is in all cases of non-delivery to be adopted, do not, in my judgment, establish that position, but they do establish that, when that value is necessary to a complete indemnity, it shall be adopted. (Watkinson v. Laughton, 8 J. R., 213; Amory v. McGregor, 15 id., 24; Bracket v. McNair, 14 id., 170; Brandt v. Bowlby, 2 Barn. & Ad., 932 ; Gillingham v. Dempsey, 12 Serg. & Rawle, 188.)

In all these cases, except that of Bracket v. McNair, the vessel had arrived at the port of destination. In that case there was an entire failure to perform the contract at all. The case is not very fully reported. The defendant agreed, on the 19th of August, 1809, to transport 400 barrels of salt for the plaintiff, from Oswego Falls to Queenston, in Canada. On the 30th August news arrived at Oswego of the non-intercourse act of the United States. In the interim the vessel had sailed without the salt, and the difference between the value of the goods at Queenston on. 1st September and their value at Oswego, was allowed as the damages. It is quite clear, though the case does not assign that as the reason, that, by reason of the defendant’s vessel having sailed without the salt, the plaintiff, from the intervention of the non-intercourse act, had lost his opportunity of getting it to Queenston at all, and hence the difference between the two values was the only measure which would give him full indemnity.

In the case now before us the vessel was accidentally destroyed by fire, while lying at the wharf, the day after the plaintiffs’ goods were put on board, and before the day on which she was to have sailed. The question then is, how the plaintiffs can be perfectly indemnified for this loss. Unless, in the absence of all proof on the subject, we are to assume that the plaintiff could not, in the port of New York, or by sending to Connecticut where these goods were purchased, have procured other goods on that day, or within a reasonable time afterwards, of the same quality and at the same price, and further assume that no other means of transporting the goods to Liverpool could have been procured in this port within a reasonable time of the day on which the Henry Clay would, bnt for her destruction, have sailed, neither of which presumptions can, I think, be reasonably entertained, we must hold that, so far as the valuation of the goods is concerned, the value in this port, at the market price, was the true measure of damage as giving a full indemnity.

This is laying out of view, as affecting the question in the present case, the conceded fact that the defendants were without fault in respect to the calamity by which the ship and goods were destroyed. I think the case clear, without taking that into consideration, but I do not intend when I say that the conduct of the carrier, his innocence or his fault, should not be the sole test in determining this question, to be understood as saying that .these considerations are never to be taken into the account by the jury in deciding whether the value of the goods shall be determined by the home or by the foreign market. On the contrary, as the liability of the carrier arises, in part at least, from a duty imposed on him by law, it might under some circumstances be wholly inequitable to impose on him, in addition to the actual value of the property at the time of the loss, the loss of the adventure itself, even if that were necessary to a complete indemnity.

And I am. not prepared to say that in a case like the present, in which, without any imputation of negligence on the part of the defendants, their vessel was accidentally destroyed by fire within a few hours after the goods were received on board, we should not consider it inequitable and unjust to impose on them a higher rate of damage than the invoice price or home valuation of the goods, if that were not sufficient to give a perfect indemnity. But we are relieved from all doubt on the latter point by the consideration that the goods were lost in the port of New York, between which and Liverpool communication is almost daily, and by the fact that there is nothing in the evidence to raise a doubt that the goods might have been immediately replaced at the same price at which they had been purchased.

Second. Ought interest to be allowed? The plaintiffs contend that it ought to be allowed as matter of law, or that at least the question should have been submitted to the jury.

The defendants contend that there being no negligence on the part of the carrier, interest ought not as a matter of law to be allowed; in other words, that the jury was properly instructed, that the plaintiffs were not entitled to interest.

In the case of Smith & Delamater v. Richardson, (3 Caines R., 221,) the Court held that interest ought not to have been allowed, but give no reason for disallowing it. There was a clear breach of duty on the part of the defendant, but the case presented this novel feature, that the plaintiffs on the defendant’s default, had taken the goods and undertaken to transport them themselves; and the Court in its opinion says it is questionable whether the entire loss of the property was not attributable to the imprudence and default of the plaintiffs. The Court in withholding interest may have been governed by this peculiar circumstance of the case.

In Watkinson v. Laughton, (8 J. R., 213,) the Court held that the question of interest depended on circumstances; that the jury might give it by way of damages in cases in which the conduct of the carrier was improper, and as no bad conduct was to be imputed to him in that case, they gave the valuation at the port of destination without interest.

The goods had been embezzled in the course of the voyage without any fraud on the part of the defendant. The plaintiff claimed the value of the missing goods at the place of destination with interest. The defendant contended that,he was liable only for the invoice price without interest. A verdict was taken for the plaintiff for the valuation at the port of delivery with interest, but subject to the opinion of the Court, which by agreement of parties was to fix the. amount of „the verdict according to valuations agreed upon, and with or. without interest as it might deem right.

The Court disallowed the interest on the express ground that no bad conduct was imputable to the defendant.

In Amory v. McGregor, (15 J. R., 24,) the Court .held that the question was one for the jury, to be decided according to their views of the defendant’s conduct. “If there was any fraud or gross misconduct attending the transaction, (say the Court,) interest ought- to be allowed,” and they refused to allow it in that case, because the defendants were not chargeable with any such misconduct.

In Richmond v. Bronson, (5 Denio, 55,) the Judge at the trial had instructed the jury that the plaintiff was entitled to interest as a matter of law. The Court said that the case was precisely like Watkinson v. Laughton, and held that such instruction was erroneous; that in actions against carriers, interest was never allowable as matter of law; but it was for the jury to say whether it should be allowed, in order that they may do justice according to the circumstances, giving as a reason for this that “ the loss of the goods may have been matter of accident, without any willfullness or intentional misconduct on the part of the carrier.”

I think it-would be hardly logical to infer from this case that where it was conceded that there was no fault on the part of the .carrier, the jury might still give interest; on the contrary, when the Court in this and the two former cases say it is a question for the jury, they mean undoubtedly that when the whole case goes to the jury on disputed facts, and the question of negligente is one for them to pass upon, the giving or withholding interest should be wholly left to their discretion, according as they might find the case to be, either one of neglect, on the part of the carrier, .or the contrary, giving interest, where the carrier is in the wrong, and withholding it where he is wholly innocent. I cannot draw any other deduction from these cases. Though in- the two cases in Johnson, the verdict was taken subject to the opinion of the Court, and the Court, sitting as a jury, refused the interest, it was still a judicial determination of the test by which to determine the propriety of allowing it, and the misconduct of the carrier was in both cases adopted as that test.

In most cases, interest when allowed is given, in part at least, upon some idea of an equivalent already received by the defendant, in the use of the money or property withholden. Hence it is allowable, even in trover, but as against a carrier, in whose hands goods have been lost, or, as in the present case, wholly destroyed without any fault whatever on his part, no such principle can be invoked. It is impossible that he should have received any advantage whatever from the possession of the goods.

But it is said interest should be allowed at least from the commencement of the suit, because as the defendants were always liable for the value of the goods, they have had the use of the money, which, as such value, represented the goods since that time.

That is very true, and if the plaintiffs had demanded by their action no more than the Court now adjudges them to be entitled to, and the defendants had refused to pay it, it might perhaps be some reason for now allowing interest; but the plaintiffs have always claimed the valuation in Liverpool, and this the defendants have always contested, and have now succeeded in establishing a different valuation. Why, then, should they now be compelled to pay interest ?

Upon the whole, we think the charge of the Judge was correct on both propositions.

A new trial should be denied, and judgment must be for the plaintiffs for the amount of the verdict.

Hoffman, J.

The question whether interest was chargeable, appeared to me at first to be plainly against the defendants. The responsibility of the defendants to the. plaintiffs was fixed by the law, as the Court of Appeals has decided. The value of the goods shipped was capable of prompt and accurate liquidation upon the home price, and of very little difficulty upon the basis of the value at the place of destination. The defendants thought proper to raise again an important question of commercial law, of great personal interest to themselves. They have kept the plaintiffs out of their money until that question was ruled against them. The decision was, that they were responsible, and ought ' to have paid at once. The plaintiffs will not obtain their full indemnity if they are deprived of interest from the time they should have received the amount, and the defendants have had an advantage in the retention of money which they should then have paid over.

The case of Dana v. Fiedler, (2 Kern., 40,) appeared to me to involve a principle which would authorize the charge of interest in the present case, and to make this charge a matter of legal right, not a case for submitting it to the discretion of a jury, to allow it or not,' according to circumstances, and their judgment upon them. The cases in which the action is simply ex delicto, of which Walrath v. Redfield, (18 N. Y. R., 457,) is an example, seemed plainly distinguishable. (See also The Gold Hunter, 1 How. & Blatchf., 300 ; McGregor v. Kilgore, 6 Ohio R., 143; 6 Ham., 358, 361.)

But the case of Watkinson v. Laughton, (8 Johns. R., 213,) holds that where the carrier is free from fault, he cannot be charged with interest on the value of goods lost or destroyed while in his custody. The interest which the jury had added to the value of the goods was disallowed by the Court, and the amount of the verdict reduced. The rule thus stated has received some confirmation or recognition in Amory v. McGregor, (15 John. R., 24-38,) and in Richmond v. Bronson. (5 Denio, 55-57.)

I feel bound to yield to these authorities, and not at liberty to disregard them upon the mere strength of my conviction, that the principles which later cases contain, and which may be deduced by reasoning from later decisions, tend to show that the rule ought not to exist, and probably will be overruled by the Court of Appeals in carrying out its own doctrines in Dana v Fielder, (2 Kern., 40.)

I must consider, therefore, the ruling of the Judge in this particular to be correct.

2. The next important question is, whether the damages shall be estimated according to the value of the goods at the port of destination, Liverpool, or at the port of shipment, Hew York. The difference is $3,368.91 of principal. The goods were shipped on the 3d and 4th of September, 1849, in Yew York, and the fire occurred on the 5th of that month. The ship was to have sailed on the 6th.

The leading case in our Courts, that of Watkinson v. Laughton, (8 J. R., 213,) is one where the vessel had arrived at the port of destination, and part of the goods had been embezzled without the fault of the captain. The net value at that port was the standard adopted.

In Amory v. McGregor, (15 John. R., 24,) the vessel was on her voyage when the capture took place, from which the loss of the goods arose. The case of Watkinson v. Laughton was recognized as governing the question before the Court.

In Bracket v. McNair, (14 John R., 170,) the defendant had neglected, without good reason, to transport the salt as he had contracted to do. The difference of the value at the place to which it was to be carried, and the value at its place of intended shipment, was allowed.

Delamater v. Richardson, (3 Caines’ R., 219,) is not of much bearing upon the question, as the case turned much upon the fact that the staves were taken by the plaintiffs, and transported at a dangerous season of the year.

In the case of Arthur v. The Cassius, (2 Story’s R., 81,) the goods had arrived at the port of destination; the consignee refused to receive them; the master was held bound to have landed them there. His conduct was suspicious: there was misconduct on his part.

In Wheelwright v. Beers, (2 Hall’s R., 391,) the goods were shipped at Yew York for Omoa, and the vessel was driven into Yorfolk. Portions of the goods were sold there, and other portions brought back to Yéw York and sold. The rule of damages adopted by the Court (Jones, Ch. J., and Hoffman, J.,) was the difference between the amount of the total sales and the invoice price at Yew York. Mr. Justice Oakley alone advocated the rule of the difference between the prime cost and the net value at the port of destination. The jury had found a verdict of $2,500, estimating the loss of the market at Omoa at $1,500. The recovery was but for $1,000. The invoice was $3,744. The sales must have been $2,744, as the difference was $1,000.

This case seems to me to involve the proposition that if all the goods had been brought back to Yew York and sold there, the difference between the proceeds and the prime cost would have been the rate of damages. If so, the case is strong to show that, when all the goods have been lost in the port of New York before starting, the prime cost is the true rule.

The case of The Tribune, (3 Sumn. R., 144,) appears to be in favor of taking the port of lading as furnishing the standard of value, but is by no means decisive.

In The Gold Hunter, (1 Howl. & Blatch., 300,) portions of the goods, shipped at Havre for New York, were plundered or consumed on the passage, and part sold to raise money for repairs at Halifax, a port of distress. It was held that the market value at New York of the goods lost was to be recovered, with interest. Watkinson v. Laughton was referred to. The vessel arrived at New York.

The case of The Joshua Barker, (1 Abb. Adm. R., 215,) was of a peculiar character. The cargo of flour was put on board a vessel at Albany, to be carried to New York. The vessel capsized at the wharf. The cargo was taken out damaged, and immediately sold by the carriers without waiting for orders from New York, which could have been received in a few minutes by telegraph, and in forty-eight hours by regular mail. The vessel itself was pumped out, and arrived at New York in a week after the accident. The value of the goods at the latter place, on the day of arrival, was adopted as the measure of damages, deducting' freight and charges and adding interest. The interest was allowed as the appropriate recompense for the fault or misconduct of the party.

In Dusar v. Murgatroyd, (1 Wash. C. C. R., 13,) goods shipped to be transported to Hamburgh were damaged in the port of shipment. The Judge charged: “ The profit which might have been obtained if the sugars had gone safely to Hamburgh was claimed at the opening, but was properly abandoned by the concluding counsel. The difference between the prime cost and Charges and the sales here, forms a fair measure of the damage sustained.”

Warden v. Green, (6 Watts’ R., 424,) was the case of part of the goods being landed at the port of delivery. Some were damaged and some missing. The value there was the rule adopted.

In O'Conner v. Forster, (10 Watts’ R., 418.) there was a contract to convey wheat from Pittsburgh to Philadelphia, a proffer of the wheat by the shippers to" the ship owners, and their refusal to receive and carry it. The damages were fixed at the difference between the market value of the goods at Philadelphia, at the time when they would have arrived, and their value at the place of intended shipment, with the freight.

Gillingham v. Dempsey, (12 Serg. & Rawle, 183,) is a leading authority. The subject was fully and ably examined. It is clear that the vessel had arrived at Philadelphia from Liverpool. The injury was sustained on the passage, and from improper stowage of the crates of earthenware. The value at Philadelphia was explicitly recognized.

Bridge v. Austin, (4 Mass., 115,) is carefully reviewed in the last cited case; and it does not afford much support to the proposition of the defendants in the case before us.

McGregor v. Kilgore, (6 Ohio R., 358,) was a plain case of neglect or misconduct of the carriers in not having efficient means of unloading and reshipping at the intermediate port. The right of doing so was given them in case of low water.

There are some other authorities which bear, though less directly, upon the present question.

It is entirely settled that when the goods, delivered to a carrier for transportation, are taken to the place of destination, but delivered in a damaged condition, or when some of the goods shipped are not delivered at all, but the vessel has arrived out, the value at the port of destination is the rule of estimating the damages. Brandt v. Bowlby, (2 Barn. & Adol., 932,) is a striking example of this rule.

So, if the vessel is driven by distress into an intermediate port, and part of the goods are there sold for the necessities of the ship, and she then arrives at her port of destination, the goods so sold are to be allowed for according to the price at the port of delivery, or the shipper has the right to elect to take the net proceeds of the sale. (Alers v. Tobin, cited Abb. on Ship., 372; Hallett v. Wigram, 9 Com. Bench R., 580.)

But in Atkinson v. Stephens, (7 Exch. R., 567,) it was decided that when a portion of the goods had thus been sold at a port of distress, and the vessel had then proceeded, but never arrived at her port of destination, the owners were not responsible for the value of the goods at the latter port. The question arose upon pleadings, and the judgment was restricted to that identical point. It was stated to be an uncertain question, whether the ship owner was liable at all if the vessel never arrived at the port of destination. Leave to amend the declaration was given, with a view to have this point considered.

The Commercial Code of France (art. 298) provides for these cases. Freight is due for goods which the master has been obliged to sell to furnish repairs, &c., he being accountable for the value of the goods thus sold, at the price of the rest, or of similar goods of the same quality at the place of discharge, if the vessel arrive safe. If the vessel be lost, the master shall account for the goods at the rate at which he sold them, retaining the freight according to the bill of lading.

Justice Story, in Pope v. Nickerson, (3 Story C. C. R., 465,) followed the rule of the Code, and held that a subsequent loss of the ship did not discharge the liability.

Mr. Abbott, (p. 372 and note n.,) has referred to the foreign authorities upon the point whether, in the case of a sale of some goods at an intermediate port, and then a loss of the ship and of the remaining goods, the goods sold were to be paid for at all. M. Boulay Paty has examined the subject with his usual care. (Droit Commercial, tome 2, p. 219.) The Judgments of Oleron, the Ordonnances of Wisbuy, and the Assurances of Anvers, are quoted with the opinions of Emerigon, of Valin and Pothier. T.he two latter authors were of opinion that the owners were responsible for the goods. He then states that the Commission (appointed by Napoleon to prepare the Code) adopted the contrary view of Emerigon, but the Council came to a different resultand he cites the reasoning of M. Begouen before the Corps Legislatif, which induced the adoption of the article as it appears in the Commercial Code.

. The learned author concludes thus l “ There cannot, then, at this day, be any further controversy. Whether the vessel arrive in safety, or is lost after the sale of the goods, the price of those goods sold for the necessities of the vessel must equally be paid, deducting the freight. Yet there is this difference: If the vessel arrive at her destination,, the goods are to be paid for at the price which the residue or others of the same quality are sold for at the place of discharge; but if the vessel is lost, the liability is only for the amount for which the goods were sold.”

The argument upon which the exemption of the ship owner from any liability was based, was mainly this, that had the goods remained on board the shipper would have lost them. Of course a loss by such a peril as is excepted in the bill of lading, is contemplated.

The rule which has thus been adopted, after long and critical examination and discussion, by the second commercial power of Europe—the rule which the Courts of England have to this extent sanctioned—that goods sold at the intermediate port shall not be allowed for at their value at the port of discharge, when the vessel perishes, sheds no faint light upon the point we are now considering. We find (under the French rule at least), that while a responsibility is fixed upon the ship-owner for goods thus -appropriated, although had they remained on board no liability would have been incurred, the value of the goods when and where lost to the owner, supplies the rule of damages.. We find, also, a marked exception to the asserted universality of the rule, that the standard of compensation is the value at the place of destination.

There are other instances in which the value of goods, at the time of the injury or loss, or the prime cost, is taken as the measure of damages. Such is the rule in all marine torts. (The Amiable Nancy, 3 Wheat., 560, and cases.) Justice Story says: “ This rule may not secure a complete indemnity for all possible injuries, but it has certainty and general applicability to recommend it.” A similar rule prevails in cases of insurance. In Smith v. Condry, (1 How. U. S. R., 28,) the Chief Justice says: “ It has been repeatedly decided in cases of insurance, that the assured cannot recover for the loss of probable profits at the port of destination, and that the value of the goods at the place of shipment is the measure of compensation. There can be no good reason for establishing a different rule in cases of collision.”

So, in general average, goods contribute according to their value at the place where they are considered saved. (2 Phil., 151; 5 Duer R., 429.

These analogies are not indeed decisive. They are capable of being distinguished from the present case on various grounds; but at least they show how many exceptions exist to the rule assumed, and to open the inquiry whether, even in the case of common carriers, others may not be found consistent with justice and policy, and not repugnant to express authority or acknowledged principle.

Upon reviewing the decisions which have been cited, I do not find one in which the value at the port of destination has been taken, unless where either the carrier has been actually in fault or neglectful, or where the vessel, with the goods damaged or with the residue of the goods, had arrived at her outward port. I do find the case of Wheelwright v. Beers, which seems to sanction the rule of a valuation in Kew York, under the circumstance's of the utter loss of the vessel and of the goods at that place before the ship had moved on her voyage. It is consistent with justice that the ship owners should respond for no more than the sum which would enable the shipper to replace goods of the same quality in the same condition on board another vessel. When the case is admitted or proven, of the entire exemption of the owners from any neglect or culpability, there does not seem to be any absolute mandate of policy which should increase their own loss or subject them to harder dealing than such a rule would prescribe. It may be observed that there is evidence of the defendants having a line of vessels engaged in running between Kew York and Liverpool.- The witness had shipped goods by that line in the months preceding the shipment in question.

I think the charge of the Court below was right in this particular.

Kew trial denied, and judgment ordered for the plaintiffs for ■the amount of the verdict, with costs of suit.


author: By the Court—Bosworth, Ch. J.

text:
    Isaac Merritt, Plaintiff and Respondent, v. John A. Millard, Defendant and Appellant.
    1. A person who receives from one party to an illegal contract, money paid in execution and satisfaction of it to the use of the other party to such contract, on a promise to pay it over to such other party, cannot defend an action brought by the latter to recover such money, on the ground of such prior illegal contract, where the person receiving such money and making such promise in no way participated in or was a party to it, and did not know of it when he received such money and made such promise.
    2. An answer which professes to set up a counterclaim, to be sufficient as a pleading, must state facts which constitute a cause of action in favor of the defendant against the plaintiff.
    3. An answer which professes to set up new matter as a defense, and does not state facts which constitute one, may be demurred to for insufficiency, if pleaded after chapter 723, of the Laws of 1857, took effect. (Laws of 1857, vol. 2, p. 554, § 153.)
    (Before Bosworth, Gh. J.; and Hoffman and Moncrief, J. J.)
    Heard, December 15th;
    decided, December 31st, 1859.
    This is an appeal by the defendant, John A. Millard, from an order made June 27, 1859, by Mr. Justice Hoffman, overruling his demurrer to the complaint of the plaintiff, Isaac Merritt.
    The complaint alleges, in substance, that on the 6th of September, 1851, one Jared Brewster owed the plaintiff $500; and that so owing him, he paid to the defendant $500, “to and for the use of the plaintiff,” and the defendant in consideration thereof “ undertook and promised to pay over the said sum of money to the plaintiff whenever he should be thereunto afterwards requested;” and a refusal by the defendant to pay this money to the plaintiff although subsequently requested; and prays, judgment for the $500, with interest.
    The answer was put in on the 26th of March, 1858.
    The defendant as a second defense, sets forth the transaction- and agreement between Brewster and the plaintiff out of which-the alleged indebtedness from the former to the latter arose;- and-he insists that such agreement is illegal and void, and one which-the Court will not assist either party to enforce, and that he may avail himself of the illegality of that agreement, as a defense to this action..

      For a third defense “ this defendant further answers and alleges that there is now still pending, in this Court, undetermined, an action for this same five hundred dollars, by this same plaintiff, against the same Jared Brewster, which this defendant insists and claims in bar of this action.”
    For a fourth defense “this defendant further says that the said plaintiff is justly indebted to him in the sum of about three hundred dollars for costs, as attorney and counsel for the said Brewster, in the action set forth in the third answer herein, which he claims by way of counterclaim in this action.”
    To these three defenses the plaintiff demurred severally; judgment was ordered in his favor, and from that order the defendant appealed to the General Term.

      J. A. Millard, appellant, (in person.)
    I. The agreement between Merritt and Brewster, it is admitted was illegal and void; and all the authorities show it to be so. I only cite here Gray v. Hook. (4 Comst., 449.)
    The objection taken below, that a demurrer cannot be allowed for insufficiency, since the Code of 1857, is still adhered to and repeated. (Code, § 153; 18 How. Pr. R., 79, 84.)
    II. The complaint alleges that Brewster was indebted to plaintiff in the sum of $500, which he paid over to defendant for plaintiff’s use, and which defendant promised to pay to plaintiff. All this is denied by the answer, and then the answer sets forth, as a second defense, how Brewster was indebed, if at all, and all these allegations the demurrer admits to be true; and the Court decided that such contract was illegal and void.
    But insisted that Brewster having executed his part of the contract, he is estopped from reclaiming the money from defendant, and the Court think there is no law by which the defendant can hold the money, and therefore the plaintiff may recover it.
    Kow it is insisted:
    1. That the contract being void, the plaintiff has no foundation to stand upon. (Thalimer v. Brinkerhoff, 20 John, 397.) The plaintiff must and does found his action upon the contract with Brewster. How else could he claim the money ? His action then proceeds upon the principle of affirmance of that contract. But the Court say (id., 398.) that “ no case can be found where an action has been sustained which goes in affirmance of an illegal contract, and when its object is to enforce the performance of an agreement prohibited by law.”
    Also, see Nellis v. Clark, (20 Wend., 27,) which holds: “An individual should not be assisted by the law in enforcing a demand originating in a breach or violation, on his part, of its principles or enactments.”
    In Vischer v. Yates, (11 Johns., 29,) the Court hold the doctrine that the plaintiff cannot recover the money; for, say the Court: “ that would be compelling the execution of an illegal contract as if it were legal, and would at once prostrate the law that declares such contracts illegal.” (5 John., 334; 2 Caines R., 148.)
    The plaintiff seeks to affirm a contract concededly only executed in part. But it is denied it is executed in part even. Upon the plaintiff’s own theory the defendant is but the agent of Brewster, and the allegation that money was paid to defendant is denied.
    Besides the contract now sought to be enforced grows directly out of the void contract and is inseparably connected with it. It is to enforce the completion of that illegal agreement. It cannot be tried without proving that contract. The plaintiff must seek aid from that contract, and how can this be without affirming it, which the law abhors. This case depends upon the validity of the agreement between plaintiff and Brewster, and if that be void it must fail. (20 Johns., 398; 7 Wend., 280.)
    The Court will not assist to carry out this agreement more than it would the one which was made to effect the very object. (De Groot v. Van Duzer, 20 Wend., 400.)
    2. The Court will not assist a party to enforce an illegal contract in any respect. (Belding v. Pitkin, 2 Caines R., 149; Nellis v. Clark, 20 Wend., 27; Pratt v. Adams, 7 Paige, 653; Tylee v. Yates, 3 Barb., 228.) The plaintiff must himself be free from imputation of fraud, he must come into Court with clean hands, or the Court leaves him as it finds him.
    III. The defendant may make the objection that the agreement between Merritt and Brewster was void. He may set it up as a defense. (20 Wend., 390, 397, 400, 401; id., 27, 37; 20 Johns., 397; 2 Caines R., 147.)

      Whenever and however, whether by complaint, answer, or evidence, the Court see the agreement is in any way connected with, or grows out of an illegal agreement, or is intended to aid or enforce such agreement, it will dismiss the matter and leave the parties as it finds them. Farmer v. Russell, (1 Bos. & Pul., 296,) holds that it is the duty of the Court to observe the transaction whenever it appears.
    IV. The answer sets up that the plaintiff owes defendant and claims it as counterclaim. The demurrer admits it, and yet the Court say it can’t see how that can be. The answer is, that the evidence would show how it could be if the Court will permit (20 Wend., 401.)

      A. K. Hadley, for respondent.
    I. Whenever a party indebted to, or. receiving money from, another, agrees to pay the amount thereof to a third party, such third party may maintain an action therefor in his own name. (Story on Contracts, § 376, X. Y. Z.; 17 Mass., 400, 575, 579; 2 Denio, 45; 4 id., 97, &c.)
    If money be specifically committed for the purpose of such payment, the promise to pay will be implied. (19 Wend., 516; Story on Contracts, § 451, a; id., 460; Weston v. Barker, 12 J. R., 281; Canfield v. Monger, id., 346.)
    It is an equitable assignment. (Story on Contracts, § 376, pp. 444, 437.)
    This is an equitable action, .and is to be prosecuted and defended on equitable principles.
    II. It does not lie in the mouth of the defendant to say that the money was given him in pursuance of a legal contract. (Tenant v. Elliott, 1 Bos. & Pul., 3 ; Farmer v. Russell, id., 296; Hastelow v. Jackson, 8 Barn. & Cress. R., 221; Yates v. Foot, 12 J. R., 6; Steers v. Lashby, 6 Term. R., 61; Brown v. Turner, 7 id., 630.)
    III. If a party voluntarily pay an unjust demand or under an illegal contract, he cannot recover it back. (Chitty on Contracts, 633-637; 11 Mass., 147, 368.)
    IV. A demurrer is the proper and only proper mode of testing the sufficiency' of the allegations in the second part of this answer. (Code, § 153.)

      Y. The third and fourth subdivisions of the answers are clearly frivolous.
   By the Court—Bosworth, Ch. J.

The second defense admits (by not denying) that the defendant received the $500 for the plaintiff, and promised to pay it to him when requested to do so; that he has been requested to pay it to the plaintiff, and refuses to pay it over, or any part of it.

Assuming the agreement between the plaintiff and Brewster to be one on which an action would not lie by the former against the latter to recover the $500, yet it is not pretended that Brewster, after having paid the money to the plaintiff, could recover it back.

Can the defendant set up the illegal agreement between the plaintiff and Brewster, as a defense to this action ?

Tenant v. Elliott, (1 Bos. & Pul., 3,) is an authority in support of the plaintiff’s right to recover. Farmer v. Russell, (id., 296,) is not opposed to it. In the latter case, the defendant was a party to tire transaction and to the carrying of the goods, for a part of the price of which (after it came to the defendant’s hands) the plaintiff sought to recover. Rooke, J., says he could not act on the monstrous doctrine, that the defendant’s innocence shall work a loss to him, and his guilt shall be his indemnity. Eyre, Ch. J., and Buller and Heath, J. J., thought the plaintiff ought to recover, unless the original transaction could be mixed with the contract on which the action was brought.

In the present action, the second defense does not aver that the defendant had any knowledge or notice of the illegal agreement between the plaintiff and Brewster when he received the $500 and promised to pay it to the plaintiff. It is sufficient to entitle the plaintiff to recover, to prove that the defendant received money for the plaintiff on a promise to pay it to him. His promise has its consideration in the receipt of the money, and in that only, and though it was a gift by Brewster, the defendant would be liable to pay it to the plaintiff.

In substance, the agreement as between the plaintiff and Brewster has been executed. Brewster has paid all he agreed to pay; not to the plaintiff personally, but to the defendant who received it for him and as his money, and on a promise to pay it to him.

In Thalimer v. Brinkerhoff, (20 J. R., 386, 398,) the Court said: “When it is considered that, in this case, the plaintiff’s only title to, demand anything depends on the validity of the agreement entered into between him and Teller, if that agreement be void, he stands without any pretense of right.”

Brinkerhoff had not received any money as the plaintiff’s agent, or to his use, or on a promise to pay it to him. He had received it under an authority from Teller, and for his use, and the plaintiff’s right to any part of the money depended solely on the validity of the agreement between him and Teller.

In De Groot v. Van Duzer, (20 Wend., 390,) the action was brought, on an agreement held to be illegal, by one of the parties to it against the other.

In Nellis v. Clark, (20 Wend., 24,) the action was brought on a note given as part of, and by a party to, an illegal transaction,' and the plaintiff stood upon the rights of the other party to such transaction.

There is, therefore, nothing in the facts of either of the three cases last cited which raises a conflict between the decisions made in them and that in Tenant v. Elliott. In the latter case it was decided that a person who receives from one party to an illegal contract, money paid in execution and satisfaction of it to the use of the other party to such contract, cannot defend an action brought by the latter to recover it from him on the ground of the prior illegal contract. Owen v. Davis, (1 Bailey R., 816,) is to the same effect.

In the present case, there is no connection between the defendant’s promise and the illegal agreement between Brewster and the plaintiff. In that agreement the defendant in no way participated, and it is not alleged that he had any knowledge of it.

He has received money from Brewster as being the money of the plaintiff, and on a promise to pay it to the latter, and although it was paid to and received by him as the plaintiff’s money; he insists upon retaining it. This is the whole transaction on which, as between him and the plaintiff, the rights of the latter and the liability of the former depend.

The cause of the delivery of the money to him by Brewster does not appear to have been disclosed at the time; with it he has no concern; it is his duty to perform his promise.

In Armstrong v. Toler, (11 Wheat., 258,) the Court held, that where the promise on which the action is brought, is entirely disconnected with the illegal act, and is founded on a new consideration ; it is not affected by such illegal act. The opinion of Chief Justice Marshall discusses the various prior decisions bearing on this question, and cites Farmer v. Russell (supra) with approbation.

A person who sells goods knowing that the purchaser intends to apply them, in an illegal trade, is nevertheless entitled to recover the price if he yields no other aid to the illegal transaction than selling the goods, and obtaining permits for their delivery to the purchaser. (Hodgson et al. v. Temple, 5 Taunt., 181.)

If it do not offend the morals of the Court, in its administration of justice, nor violate any considerations of public policy to entertain such an action, it is not obvious why it should be reluctant to enforce the promise of a defendant who has received from a third person money to the use of the plaintiff upon an agreement to pay it to him, when that is the whole transaction to which the defendant is a party.

isTo case precisely like the present has been cited, in which it was held that the defendant could prevail on the grounds relied upon here.

By 1 Revised Statutes, 771, title III, and the act of May 15th, 1837, Laws of 1837, 486, usurious agreements are declared to be void, and the taking of usury is declared to be a misdemeanor, and is indictable as such. (Laws of 1837, 487, § 6.) In Murray v. Judson and Sands, (5 Seld., 73,) it was held that a general assignment, by an insolvent debtor, of his property to a trustee for the payment of his debts, is not void on account of its providing for the payment of a usurious judgment, giving it priority over other debts, if it be in other respects free from objection.

Gardiner, J., said, “ the assignment was not a contract with the holder of the judgment, or a mere security for that debt, but the setting apart of property for the payment of a specified demand in the order designated. (Id., 83.)

That remark suggests a clear distinction between the present case and Dewitt v. Brisbane et al. (16 N. Y. R., 508.) The latter case holds, that “ the assignment, to secure the performance of an agreement void for illegality, of a mortgage valid between the parties to it, transfers no title, and is a defense to the mortgagor in an action brought against him by the assignee.”

In the case cited, the assignment was executed as a part of the illegal-contract, and to. secure to the assignee its performance by the assignor.

In the present case, the money sought to be recovered from the defendant was not paid to him as security for the performance by Brewster of his illegal contract with the plaintiff.

It was paid to him after all of that contract had been performed, except the payment by Brewster of the sum he had agreed to pay to the plaintiff It was paid to and received by the defendant as the plaintiff’s money, and on the defendant’s promise to pay it to the plaintiff.

The defendant’s promise to deliver the money to the plaintiff, and the delivery of it to him for the plaintiff’s use on the defendant's promise to so pay it, is the whole of the • transaction as between the defendant and Brewster.

When the plaintiff, sues the defendant' to recover the money on the refusal of the latter to pay it, the defendant should not be permitted, in such a case, to allege that Brewster was under no legal obligation to appropriate the money to'the plaintiffs use; but on the contrary appropriated it as performance, on his part, of a contract between him and the plaintiff, which was void for illegality.

It is enough to entitle the plaintiffs to recover, that the money when it came into the defendant’s hands was the money of the plaintiff, and was received as such, and that there is no pretense that Brewster resists- the payment or objects to the plaintiff’s right to the money.

The plaintiffs cause of action against the defendant does not arise ex- turpi causa; but is founded lipón a transaction subsequent tp and not mixed with the illegal agreement. It arises solely, upon the defendant’s acceptance of money as the property of the plaintiff and his promise to pay it to him; and upon the defendant’s breach of - that promise.

We thjnlc the demurrer to the second defense is well taken. We understood the defendant’s counsel to concede, that the mat-, ter pleaded as a third defense did not constitute one. If it does not, the demurrer to it is well taken. (Laws of 1857, vol. 2, p. 554, § 153.)

In respect to the fourth defense, we think it quite clear, that a complaint, in an action by the defendant against the plaintiff, containing the same allegations, would be demurrable as not stating facts sufficient to constitute a cause of action.

No fact is stated, which justifies the inference that the plaintiff is liable to the attorney of Brewster for his services as such, in defending a pending action brought by the plaintiff against Brewster.

It id as essential to the sufficiency of an answer which attempts to set up a counterclaim or set-off, as to a complaint, that it state facts constituting a 'cause of action. The part of the answer, which states the fourth defense, does not do that.

The order or judgment appealed from must be affirmed.-

Order affirmed.


author: Bosworth, Ch. J.

text:
    Abraham C. Dayton v. George Wilkes.
    1. A. & W. being partners, A., with the consent of W., transferred all his interest to D.; D. and W. covenanting with A. to continue the same business, and to collect and apply the assets of the old firm, (except such as was necessary to pay current expenses,) to pay the debts of the old firm. The new firm becoming embarrassed, D. instituted a suit against W. to obtain a dissolution of his partnership, an accounting between them and a proper application and distribution of the assets: Held, that A. could not, upon petition, obtain an order that he be made a party to the action, and that the complaint be so amended as to bring him before the Court on ■ pleadings presenting his alleged right to an equitable application of the property of the new firm, originally belonging to the old firm, to the end that his rights in such property might be determined, and the property distributed accordingly.
    2. Such an action is not one for the recovery of personal property within the meaning of § 122 of the Code.
    (At Special Term, October 28, 1859,
    before Bosworth, Ch. J.)
    This suit is brought by Dayton against Wilkes to obtain a dissolution of a partnership between them, and accounting an a distribution of the assets of the firm.

      James B. Devoe, upon petition and notice, applies .for an order that he be made a party to the suit, and that the complaint be so amended as to bring him before the Court, upon appropriate pleadings, to the end that his rights and interests in the property, which is the subject of the action, may be properly determined and protected, and for such other or further relief as may be • just.
    The petition' states that Devoe and Wilkes were partners up to February, 1858, when Devoe transferred his entire interest to Dayton; that Dayton and Wilkes were to continue the business as partners, and have done so until this suit was brought, and that they agreed to collect-the assets of the old firm and apply them, (except so much as was necessary to pay current expenses,) to pay the debts of the old firm. That there are debts owing by the old firm, and that it has assets not yet converted or realized, and that the new firm is insolvent.
    The papers in opposition to the motion tended to show that Devoe had instituted a suit in the Supreme Court against Dayton and Wilkes, with a view to obtaining therein the relief to which he was entitled in the premises, and that he had moved for an injunction to stay proceedings in this action until a determination could be had in that. That such motion was denied and that such action is still pending.
   Bosworth, Ch. J.

Devoe and the creditors of the old firm have an equitable right to insist that the assets of the old firm 'be applied to pay its debts. (Deveau v. Fowler, 2 Paige, 400.) The agreement of Dayton and Wilkes to so apply them is in accordance with such equity.

Can Devoe compel the plaintiff in this suit to make him a party to it, to enable him to set up and obtain a judicial determination of the claim above stated ?

The second sentence of section 122 does not confer on him that right, unless this be “ an action for the recovery of real or personal property ” within the meaning of that section. It is not an action to recover real property. Chapter 2, of title VII, of part II, of the Code, (p. 311, Voorhies’ Code of 1857-8, § 253,) and sections 277, 289, subdivision 4, and section 304, subdivisions 2 and 4, show very clearly that an action “ for the recovery of personal property ” is something entirely different from a suit by one partner against another, to procure a dissolution of the firm and an administration of its assets.

Whether a complete determination of the controversy between Dayton and Wilkes cannot be had, without prejudice to the rights of Devoe, or by saving his rights, and without his presence as a party, is not to be determined on a motion like the present. That is a matter for the determination of the Court before which the cause may be tried, or brought to trial. The present motion, therefore, cannot be granted. But Devoe may have a stay of proceedings in this suit long enough to enable him to institute a suit, upon a complaint properly framed to present his claim. If the suit in the Supreme Court is adapted to this object, a discontinuance of it and commencing a new suit in this Court would seem to be a useless expense.

The institution of a suit in this Court, would make it necessary to discontinue the one in the Supreme Court.

I see no reason why the complaint in the suit in the Supreme Court, if not now in the proper form, may not be so amended as to enable the whole controversy to be determined by one action. But of- this the petitioner must judge for himself.

The most relief that can be granted on the present motion, is an order staying proceedings in this action, except on the part of the receiver to collect and preserve the assets, for ten davs, to enable Devoe to institute an action against Dayton and Wilkes and apply for such relief as he may be advised. He must pay $7 costs of opposing this motion.