author: Mr. Justice WAYNE

text:
    John Walker, Plaintiff in error, v. The President and Directors of the Bank of Washington, Defendant in error.
    Every subsequent security» given for a loan originally usurious, however remote or often yenewed, is void.
    Where there was an application to a bank for a discount upon a note, to be secured collaterally, and the party applying drew checks upon the bank which were paid before the note was actually discounted; and the bank treated the note, when discounted, as having been so on the day of its date instead of a. subsequent day on which’ its proceeds were carried to the credit of the party, it was held not tó be usury.
    The court below was right in refusing an instruction to the jury that, upon such evidence, they might presume usury as a fact.
    In cases of a written contract, the question of Usury is exclusively for the decision of the court.
    'This case was-brought up by writ of error from the Circuit Court of the United States for the District of Columbia, in the county, of Washington.
    The facts were these.
    On ,the 30th o£ January, 1840, Walker, the plaintiff in error, addressed the following letter to the bank:
    ■ “ Gentlemen : — I am desirous of obtaining a loan of twenty-five thousand dollars, to purchase cattle for fulfilling my contract with the government, for Ni York station, say 2000 barrels, and amounting to nearly. $27,000.
    ' “ In security for the above money I’ll assign all my right and title to the beef now on hand, say barrelled and salted, and ajl that I may have (reserving a prior- right'of $3000, already given for Norfolk station) at the"warehouse on Bradley’s wharf, to be subject to your control.
    “I’ll deposit an accepted draft of E. Kafie, Esq., navy agent, fo,r the payment of my contract for N. Y. station.
    “ Y’rs resp’y, Jno. Walker.”
    On the 6th of February, 1840$ John Walker executed a promissory note in favour of Henry Walker or order, for $10,000, payable ninety days after date, negotiable and payable at the Bank of Washington. This note- was delivered to the bank under the. circumstances stated in the first bill of éxceptions. ' The note upon which the suit was brought was a renewal of it, dated on the 9th of May, 1840, the maturity of the above.
    On the 19th of February, 1840, the following draft was drawn: “Elias Kane, Esq., navy agent, Washington, D. C.
    “ Sir : — Please*pay to James Adams, Esq., cashier of the Bank of Washington, or order, the. sum of fen thousand dollars, out of the delivery of navy beef, to be. made by me at the navy yard, Brooklyn, New York, under my contract, dated 30th September, 1839. “And oblige, sir,-very respectfully, &c., your ob’t, serv’t.
    “ Washington, D. C., February 19, 1840.” Jno' Walkee-

      On the face of the aforegoing draft was the following acceptance, to wit:
    “Accepted, to be paid by me, when the bills shall have been, received and duly approved by the commandant of the navy yard.
    “Elias Kane.”
    On the 20th of February, 1840, Walker executed to the bank a bill of sale of. all the beef which he had then on hand or should put up, reciting that he,-Walker, stood largely indebted to the bank on loans and discounts obtained from it,-and was anxious to secure the payment of notes that had been drawn or given, or might thereafter be drawn or given, &c., &c.
    On the 2d of April, 1840, the following draft was drawn, which is referred to in one of the exceptions:
    Elias Kane, Esq., navy agent, Washington, D. C.
    “ Sir : — Please pay to James Adams, Esq., or order, the amount due me for delivery of navy beef, to be delivered by me, under my contract, at the navy yard, Brooklyn, New York.
    “And oblige, sir, very respectfully, your ob’t serv’t,
    “ April 2d, 1840. Jno. Walker.”
    ■ On the face of the above was the following acceptance, to wit:
    “Accepted, to be paid by me, when the bills shall have been ' received and duly approved by the commandant of the navy yard, Brooklyn, New York. Elias Kane, Navy Agent/’
    On the 9th of May, 1840, the following noté was executed upon which the suit was brought:
    “ [$10,000.]. City of Washington, May 9, 1840.
    “ Thirty days after date I promise to pay to Henry Walker, or order, ten thousand dollars, for value received. Negotiable and payable at the Bank of Washington. Jno. Walker.”
    “ Credit the drawer.”
    It was endorsed by Henry Walker, Lewis Walker, and John Walker.
    Not being paid at maturity, suit was brought upon it .in May, 1840, and in 1841 the case came on for trial, when the following exceptions were taken, on the part of the defendant.

      1st Bill of Exceptions.

    “At the trial of the above cause, the plaintiffs having given evidence tending to prove the handwriting of the defendant to the promissory note declared upon, read it in evidence, and then rested.
    “ Whereupon the defendant then gave evidence, tending to show that the note dated on the 9th of May, 1840, was given in renewal of a previous note dated on the 6th of February, 1840, similarly signed and endorsed, payable ninety days after date; which said note, of the 6th of February, 1840, was discounted by the plaintiffs, at the request of the defendant, for his accommodation, as a loan, on the 18th February, 1840, but not passed to his credit until the 22d February, 1840; at which time, last aforesaid, an officer of the plaintiffs- deducted from the proceeds of said, note the interest bn the same, computed from the date of said note, (the 6th February, 1840,) for the period of ninety-four days, and that said note nowhere appeared on the books of the plaintiffs until the 18th February, 1840; that the whole amount credited by plaintiffs to the defendant,- as the consideration of said note dated upon the 6th February, 1840, and discounted only upon the 18th' February,' 1840, and passed to defendant upon the 22d of sanie month, was the sum of $9,843 33; and that the sum of $156 67 was taken by said plaintiffs, as the interest upon said note, for the time the same was discounted. And further gave evidence, tending .to show that the said note of the 6th of February, 1840, was surrendered to the defendant upon the execution of the said note of the 9th of May, 1840, (the said last mentioned note being but a renewal of the former,) and that the said plaintiffs credited the defendant, on account of the said note of the 9th of May, 1840, only the sum of $9,943 33, and took,, as interest upon said last named note, the sum of $56 67, which was exacted from said defendant.
    “Whereupon the plaintiffs gave evidence, tending to prove that, on the 20th of January, 1840, the defendant had checked out of plaintiffs’ bank $1224 93 ; that, on the 6th of February, 1840, he had checked out of plaintiffs’ bank $2500; and, on the 21st of February, 1840, he had checked out of said bank to the amount of upwards of $7000; all of which last named sums of money were charged to defendant on the books of the plaintiffs, and no-moneys or funds appeared to his credit at the time of drawing out said last mentioned sums of money; and that, on the 22d day of February, 1840, the plaintiffs credited said defendant with $9,843 33, as the proceeds of said note dated the 6th February, 1840; and the balance then appearing to be due to defendant on the books of the-plaintiffs, after charging him with the several amounts so as aforesaid drawn out of bank by him previous to the 22d of February, 1840, was $997 86; which balance was shown to the defendant, and assented' to by him. ■ •
    ■ “The defendant then gave evidence tending to show that the said ■note, dated 6th February, 1840, was “brought, on or after the 11th February, 1840, (it being a discount day,) bv the president of the plaintiffs, or.a book-keeper of said plaintiffs, to the discount clerk, (the witness,) and' given to him as a note not d.one, or not passed by the board of directors;. and that said note remained in the hands of-such discount clerk, until the 18th Iebruary, 1840, when. it was passed by the said board; and on the 22d February, 1840, the sum of $9,843 33 was passed to defendant’s credit as the nett proceeds of said note, and that interest, at the rate of six per centum per annum on $10,000, computed from the date of said note, for ninety-four days, was reserved at the time of entering such credit, by direction of some officer of the plaintiffs; and that it was the usual practice of plaintiffs to take, interest on discounts only from the time of making the discount; aiid that it does, not appear that defendant was credited, on plaintiffs5 books with the interest computed from the 6th of February aforesaid;
    “ The defendant then asked the cashier of the plaintiffs, who was sworn as a witness in said cause, whether the amounts drawn out of bank by the defendant previous to 22d February, 1840, as aforesaid, were not charged on the books of the plaintiffs as overdrafts, and were not allowed as the personal credit of the defendant.

      “ Whereupon .the said cashier answered, that he had no doubt but that the defendant was allowed to check upon said note of 6th February, 1840, before the same was entered to his credit on the books of the bank. And being further asked for the reasons of this opinion by the defendant’s counsel, he stated that he had no recollection of said note’s being in bank previous to .the 18th February, 1840, or of its existence, <?r of any arrangement with reference to it pre- ' vious to that date; and' that the said amounts, so checked out previous to 22d February, 1840-, would not have been paid on defendant’s checks, but for the‘knowledge, on the part of the said cashier, that he (defendant) had a large contract with the Navy Department for the supply of beef, and that for antecedent liabilities the defendant had given to plaintiffs good collateral security; from which, however, no surplus resulted after paying -sai'd liabilities;' and that the said advances made to the defendant after the 6th Februar , 1840, and previous to the 22d February, 1840, were made' o security given, or to be given; but he does not know of any security'’ given during that time, except the defendant’s letter of 30th January, 1840, a bill of sale,'by defendant to plaintiffs,'of his barrellet beef, dated 20th February, 1840', and the two acceptances of the navy agent, dated 19th February, 1840, and 2d April, 1840, and the note, dated 6th of February, 1840, of which the said cashier has' no recollection until the 18th of February, 1840; and that he is. satis*' ■ fied that said advances were not made on the personal credit of defendant. And, from all the above' circumstances, he has no doubt that said note of 6th February, 1840, was in bank from the time of its date, and that defendant was allowed' to check on said note from the day of its date.
    “Whereupon the defendant moved thé court to instruct. the jury that the facts mentioned by said cashier are evidence in said cause, but the inferences or opinions of said cashier are not evidence; but the court refused to. give such instructions as prayed, but instructed the jury that the inferences or opinions of said witness are not of ■themselves evidence of the facts so inferred,.but that the facts stated' by the witness, as the ground of his inference or opinion, are competent to be given in evidence to the jury,'together with the inference or opinion of the said witness; from which facts the jury-are to judge whether such inferences and opinion are justified by the facts thus stated. . Whereupon the • defendant excepts to the. said refusal and to the instructions so given, and this, his bill of exceptions, is signed, sealed, and enrolled, this 24th day of December, 1841.”
    , Defendant's 2d Bill of Exceptions.

    “After the evidence contained in the aforegoing bill of exceptions had-been given, the defendant prayed the court to instruct the jury that, ^ff the jury believe, from the evidence aforesaid, that the advances to defendant named in the evidence were not made upon the note of 6th February, 1840, and that the plaintiffs, upon discounting said note, received or reserved more than at the rate of six per centum, per annum, then the jury may infer usury, from the whole- evidence aforesaid, in said note of 6th February, 1840.’ And ‘if-the jury believe, from the evidence-aforesaid, that the note of the 9th of May, 1840, named in the evidence, was given in renewal of a former note of the defendant, dated on the 6th of February, 1840, payable in ninety days. after date, and which .last note was discounted by the plaintiffs, as a loan to the defendant, on the 18th day of. February, 1840, but was not passed to the credit of the defendant until' the 22d February, 1840, and that the said plaintiffs then charged .and' re'ceivéd interest upon the same from the date of the said_jiote, to wit, from the 6th day of February, 1840, it-is the taking above six per centum per-annum for the loan of the money made to the defendant upon said note, and iá usury; and the defendant is entitled to á verdict in his favour upon said note, notwithstanding the jury may find, from the evidence, that the defendant had overdrawn his account, as‘stated in the evidence, unless they 1 further find that the said interest, reserved as aforesaid, was credited to defendant’s account as a credit to take effect from the 6th February, 1840.’ But the court refused to grant each of said prayers, though presented setiatim. Whereupon the defendant, excepts to the said refusal; and this, his bill of exceptions, is signed, sealed, and ordered to be enrolled, this 24th of December, 1841.”

      Defendant's 3d Bill of Exceptions.

    “ In- addition to the evidence contained in the foregoing bill of exceptions, which is made part hereof, the defendant gave evidence tending to show that,, in October, 1839, the plaintiffs suspended specie payments, and have not, since that time, paid their notes in specie or its equivalent until July, 1841; and further gave evidence tending to prove that the paying teller of the plaintiffs, according to his impression, would not have paid the checks of the defendant for ' the amounts credited to defendant as aforesaid, on the 22d and 28th February, 1840,. if drawn for the entire amounts in -District bank paper or iirthe plaintiffs’ paper, ^unless he had received special instructions to that effect from the president, or unless.he, the paying teller, knew that the plaintiffs were at that time desirous of increasing the circulation of ’their own notes; that he considered he had .a dis-cretioryon that subject, in absence of instructions, and has no recollection of having received any instructions in regard to the discounts to defendant, or any general instructions as to the mode of paying discounts at that time, though it is his impression that he would not have paid .discounts to so large an amount in District bank paper or plaintiffs’ paper at.that time; nor would they, at the date' of said notes, have received on deposit paper of Virginia banks (they having also suspended at the same time) in large- amounts, or to the amount of either of said notes, unless, for the accommodation of a regular, customer of the plaintiffs, and'only in that case upon the understanding that he would receive back the said deposit in the same kind of funds; and that the plaintiffs would riot, by their officers, have received payment of the notes in suit, in case their amounts had been tendered at the time of maturity, in the paper of Virginia banks, (all of which were in a state-of suspension of specie payments,) and that the market value of Virginia bank notes, in the months of February, March, April, and May, 1840, in the city of Washington, (where the plaintiffs did business,) was from J to 1 per cent, less than the notes of the banks in said District, or the notes of banks in Baltimore, Maryland.
    “'And the defendant farther gave evidence to show, that on the 30th January, 1840, .he sent to the plaintiffs his written application for a loan, in these words, (see statement.) That he afterwards executed the note of the 6th February, 1840, named in the first bill of exceptions, and the note of. the 25th February, 1840, now in suit; and then was passed-to his credit, on the 22d February, 1840, on the books of die plaintiffs, the sum of $9,843 33) as the proceeds of the discount of said above-named note of the 6th February, 1840; and on the 28th February, 1840, the farther sum of $5,939 was passed to his credit on the books of the plaintiffs, as the proceeds of the discount of the note dated 25th February, 1840. That the defendant checked out of the plaintiffs’ bank the said several amounts so crer dited to him, and he gave evidence to show that some of his checks fov-.said amounts were specially- made payable in'Virginia notes’, arid were in that form. paid by the plaintiffs. That a check for upwards of $900, drawn by the defendant on plaintiffs on the.29th February, 1840, for part"of the proceeds of tire note of 25th February, 1840, passed to his credit as aforesaid, was also made myable in Virginia money on its face, but the plaintiffs, through their officers, refused to .pay even Virginia money on -said check, but against the wishes and request of the bearer, one Sinclair, (to whom the said cheek was given for value by- said defendant,) paid the said check in notes of suspended. banks in Delaware, Pennsylvania, and Ohio, being notes more depreciated in value than Virginia paper in said District of Columbia; and that said, Sinclair had to pay, on $260 of said money paid to him on said check, a discount of'$¡10, to obtain the equivalent of Virginia notes, and the balance of said proceeds of said check the said Sinclair could not pass at all, and he required the defendant to take it from him, which hé did. , And further gave evidence tend'ing to prove, that at the time of the dates of said noté, and of the proceeds thereof being credited to defendant as aforesaid, it'was the-practice of the plaintiffs, through their officers, not. to pay out the accommodations or discounts made by the plaintiffs, to such large amounts as either of said notes, in the loc.al bank paper of said District or in specie, but in paper more, depreciated than that of the said banks in said District. And further, gave evidence tending to show, that in February, March, April,- and May, 1840, notes of the Virginia banks,were not considered bankable money, and that the plaintiffs had a notice posted up in their bank; that they would not receive the paper of the Virginia banks on deposit or payment of debts; and' that the defendant did receive- the pr meeds of the loans stated as aforesaid hi Virginia paper, and some in Pennsylvania paper.
    “Aiid the- plaintiffs, in cross-examining the said witness in said • cause, further proved, that said Walker always drew out personally, and on his checks, either the Virginia money or- the other money, as he desired or'directed, and generally such as he-asked for, and never at any time made any objection to the moneys he was paid in; and further, that he declared that Virginia money was as good to him as any funds in which he could-be paid, and .that he preferred it to any other.. And further proved, that the state of the'bank,.and its business, and the notes they usuallyjp aid out, at the date of " said defendant’s letter,, and at the date of the notes-and the times of their-being discounted, were well known, to-"the-eustomers of.the bank; and that the defendant was then, and had been before, a' considerable customer; and that all the notes of Virginia banks, or of other banks, paid opt to' defendant or-other dealers, were received by the] bank in the way of its business, at par; and notwithstanding the notice aforesaid, the bank took ’such notes in small payments, or when mixed with others in large payments, or on deposit by, customers whose business was such .as induced the officers to expect "that they-would take the same sort of notes in payment from the bank.
    “And .the plaintiffs further, proved, on the cross examination of said witness, the cashief of said bank, that,- at thq time of th'e dates and discounting the said notes, it was the custoin.'of.thehankto pay out, for the proceeds of its-discounts, its own notes, or the notes of other .banks, as desired by the parties receiving such discounts; that, when the parties required it, they paid out their own notes- and when no particular paper was required, they, paid out. such as had most accumulated, and if was most .convenient for the bank to pay out; and that said Walker, if he had insisted on it, would, at the times nf payment to him of' said proceeds of said notes, according to their then practice, have had paid to him the same iit their own notes.'
    “ Whereupon the defendant prayed the court to instruct the jury, as follows, to wit:—
    “Prayer No. 4:
    , “ That if the jury believe, from the evidence aforesaid, that at the time the plaintiffs advanced the amounts of the notes hi question, after deducting the discounts on the same, it was well understood and arranged between the plaintiffs and defendant, that the said amount should be advanced and loaned by plaintiffs to defendant, on condition that defendant should draw such amounts from said bank in Virginia bank notes, or in notes of other state banks in .a state of suspension of specie payments — all which notes were depreciated in the market, and-commonly passed below the current value of the notes of the said bank, and notes of other suspended banks in this District* and all without exception, as well the -notes of the said bank as of •other suspended bánks of this District, were considerably depreciated, and commonly passed below the current money of the United States ;■ and thafftiefendant- did, in pursuance of the terms and conditions ,of said loan, in fact receive the amount of said loans from the plaintiffs in the bank notes of Virginia and of other states, which, at the time the same were so received by defendant, were depreciated considerably below the current value of tire' bank notes, of this District, and still more considerably depreciated below the standard and current -value of the current money of the United States, without any allowance for the depreciation of the same; ■ and that such depreciation was well known to plaintiffs at the- time and times of .such loans; and that defendant would not have been permitted, and in fact was-not permitted, by the plaintiffs or the .officers of said bank, to draw out the amounts of such loans from the said bank,-either in the notes of said bank, or of other solvent though suspended banks of this - District, or in the current money of the United States; and that the plaintiffs were to .have received,, and expected to receive, in repayment of-said advances and loans, current money of the United States, out of the said drafts on the navy agent, and would not have received, in repayment of said loans, the whole amount of either loan or note, the bapk notes of Virginia or of other state banks in a state of supension; and that such current- money of the United' States -was then at a premium very considerably over and in 'exchange for the notes of any of the suspended, state banks, and of any of the banks in this District: then tíre jury should conclude from said'facts, that the said loans, were usurious, and the said notes void.
    “ Prayer No. 5:

      “ If the.jury believe, from the evidence aforesaid, that there was an application by the defendant to - the plaintiffs for a loan of a large sum of - money, and that the defendant being in want of-such sum of money, the plaintiffs agreed with him to loan him the amounts of the notes in suit, provided he would take the said amounts (after deducting therefrom the rate of six per centum on the same for the time the said notes had to run) in notes of Virginia banks in a state of suspension, or some other state banks in a state of suspension, at their nominal-amount; which said suspended bank notes were -then depreciated in value below the value of the District bank notes, and much more depreciated below the value of specie; and that defendant-.would previously execute his notes to the plaintiffs for the nominal amounts so to be advanced to him, superadding thereto the interest on the amount mentioned in each of said notes for the time said note had to run; and that the defendant, in pursuance of said agreement, did afterwards receive the said notes of suspended banks in Virginia and other suspended state banks: And that if the jury further find that the bank reserved, on the respective nominal amounts of money so loaned to the defendant, interest thereon at the -rate of six per centum per annum, paying him the balance of said loans in the depreciated paper aforesaid, and that the plaintiffs, according to the agreement between them and defendant, expected and intended to receive the amount of the notes in suit, with interest thereon* in specie, or in funds of greater value than the money so paid, as the proceeds of said notes as aforsaid: then the said facts, if believed by the jury, constitute an usurious agreement, and all contracts founded thereon are null and void.
    “Prayer No. 6:
    “If, from the evidence aforesaid, the jury shall find an agreement between the plaintiffs and the defendant, by which the defendant borrgwed from the said plaintiffs the amounts of money mentioned in said notes, deducting interest on said amounts at the rate, of six per centum per year, and that the proceeds of said loans were paid to-the defendant by the plaintiffs in depreciated bank notes, as a device, and with intent to eva'de the statute of usury, and that the said notes were founded on such agreement, and made in pursuance thereof: -then the jury ought to find the said agreement to be usurious.
    “ Prayer No.1 7:
    “ If the jury believe, from the evidence aforesaid, that the notes -in suit were given in consideration of a loan or loans of money made-by plaintiffs to defendant, and that by the terms of the agreement on which said loan or loans were made, the defendant was compelled to take the same in depreciated paper, (well known to the plaintiffs to be depreciated,) whereby the defendant not only paid the legal interest on the nominal'amount of said loans, but sustained a loss on the depreciated paper with which the plaintiffs paid him: then it is competent for the jury to infer' usury from the whole circumstances in evidence.
    “Prayer No. 8:
    “ It is competent for the jury, from all the circumstances in evidence, to infer usury in the agreement or agreements on which the notes in suit were founded.
    “ But the court refused each of said prayers, though presented seri-atim, and the defendant excepts to such refusal, and claims the same benefit of exception as if each refusal aforesaid was separately excepted to. And this his bill of exceptions is signed, sealed, and ordered to be enrolled, this 24th day of December, 1841.”

      Brent, for the plaintiff in error.

      Hellen, for the defendants in error.
   Mr. Justice WAYNE

delivered the opinion of the court.

This suit is brought upon a promissory note, given in renewal of. a former note, which had been discounted by the defendants in error. The defendants in the court below deny that the plaintiffs have any right of action upon the note sued on, on the ground that the first note was tainted with usury.

Such is' the law in such a case. The mere change of securities for the same usurious loan to the same party who received the usury, or to a person having notice of the usury, does not purge th'e original illegal consideration, so as to give a right of action on the new security. Every subsequent security given for a loan originally usurious, however remote or often renewed, is void. Tuthill v. Davis, 20 J. R. 285; Reed v. Smith, 9 Cow. 647, and the cases of Sauerwein v. Brunner, 1 Harr. & Gill, 477 ; Thomas v. Catheral, 5 Gill & Johns. 23, decided in .the courts of appeal in Maryland, under the statute of which state, it is said,. the note now sued upon is void. But such is -not the case before.us. The defendant, Walker, ha’d entered into "a contract with the United States to supply the navy with beef?" and to enable himself to do it, he applied to the bank, by letter dated the 30th January, for a loan of $25,000, and offered as a security a,- draft- upon E. Kane, the navy agent, and also to assign to the bank die beef which he might put up. The bank accepted his offer, but before Walker gave the draft upon Mr. Kane, or made the assignment, he drew his note on the 6th day of February, seven days after he had written his letter asking for a lorn, for $10,000, at ninety days, and handed it into bank;- which note, at maturity, was renewed by the note of the 9th May, now in suit. . This note, however, washot discounted until the 18th February, and when then done, .the proceeds, were not passed to his credit until the 22d. The. cause .of the delay, in both particulars, the proof in the case shows, was, that Walker did not, until the 19th of February, draw hisdraft.uponthe navy agent, as he had proposed to do, or make an .‘assignment fif..he beef to the bank, until tire 20th. He may or may not have passed the navy agent’s acceptance to the bank oh the day it is‘ dated, „dr-have delivered his deed for the beef the day after; but between thqse days and.the 22d inclusive, he did so, and the bank’s security being then in its possession ás he had offered it, the proceeds of his $10,000 note was, on the last mentioned day, passed to his' credit. But, in the mean time, Walker had drawn out of the bank, upon his checks, morerthan seven thousand dollars, with which he was debited when the proceeds of bis note were carried to his credit; which sum and the interest upon it, computed for ninety-four days, from the date of the' note, left a balance to his credit of $997 86. .The computation of the interest from the 6th February; instead of •from the day when the proceeds were carried to his credit, is the usury complained of. The letter of the defendant of the 30th January, asking for the loan of $25,000; the acceptances, of his drafts upon the navy agent by that officer, and the defendant’s assignment to the bank of certain portions of the beef which he had on hand, and'which he might put up under his contract with the United States, and which ■ assignment 'was not executed until the 20th February, were in evidence before the court below. The assignment recites the defendant’s contract with the United States, so far vas it was • necessary to introduce the- contract which he was about to make in it with the bank; .then His indebtment to the bank for loans and discounts, his intention to secure the payment of the money due by him, and all drafts, note or notes that have been given for the same, or might be afterwards given by way of substitution or renewal of such drafts or notes, or any of them, &c., &c., and then states that the money which had already been advanced or loaned, or which might afterwards be advaneed-or loaned by the bank to the defendant, being for the purpose of enabling him to fulfil his contract with the United States. Now, the proof is positive, on both sides, that the note sued on was given in renewal of the note of the 6th February, which had first been given under his proposal for a loan, and that it was intended to be the note, the payment of which was to be secured by the assignment. Such being the .evidence, the court correctly refused every instruction which was asked to refer the question of .usury to the jury as a fact. It was a case of a written contract, in which the court had the exclusive power of deciding whether it was usurious or not. Levy v. Gadsby, 3 Cranch, 180. But, if it were'not so, we think the instructions, as they v?ere asked, could not Have been given by the court to the jury. Each' of them called upon the court to give an opinion upon the sufficiency of the evidence, and in all of them, except the eighth, there was a separation of the facts from the entire evidence, so as to bring them under the cases of Scott v. Lloyd, 9 Peters, 418; Greenleaf v. Booth, 9 Peters, 292; and that of the Chesapeake and Ohio Canal Co. v. Knapp, 9 Peters, 541. Nor do we think that there was any error in the instruction given by the court to the jury under the defendant’s first prayer. The court sufficiently distinguish between the facts of the cashier’s evidence and His belief, and tell the jury that they are to determine by the facts whether the cashier’s inferences were justified.

The judgment of the court is affirmed.


source: Caselaw Access Project

author: Mr. Justice DANIEL

license: Public Domain

text:
    William Henderson, Plaintiff in error, v. John Anderson.
    This court adheres to the rule laid down in Walton v. Shelly, i T. it. 296, sustained as it has been by tire decisions of this court'in The Bank'of the United States v. Bunn, 6 Peters, 57; The Bank of the Metropolis v. Jones, 8 Peters, 12, and Scott r. Lloyd, viz., that a party to a negotiable paper, having given, 'it value _and currency by the sanction of his name, shall not afterwards invalidate it by showing, upon his own testimóny, that' the consideration on which it was executed Was illegal.
    This case was brought up by writ of error from thé,Circuit Court of the 'United States in and for the- eastern district of Louisiana.
    Anderson was a citizen of Kentucky, and William Henderson, of •Louisiana. • Henderson was. a partner, in the commercial house of John Henderson,and Co., carrying on business in the town of War-renton, Warren county, Mississippi.
    On the 3d of February, 1537, Thomas J. Green drew thefollow-iiig inland bill:'
    “ Warrenton, February 3d,' 1837.
    “ Exchange for $3795 -00.
    ,Twelve months after date of this tfiy first of exchange, (second of the same tenor and date unpaid,-).pay to the order of Messrs. John Henderson & Co-, thirty-seven hundred and ninety-five dollars, value received, and charge the'same to.account of
    ^ • “ Your obedient servant, . - Thqs. J. GREEN.
    “ To Messrs. Briggs, Lacoste, & ,Co., Natchez.”
    It was endorsed by John Henderson, & Co. and D. G. Barlpw & Co., and passed into the hands of Anderson. Being protested for non-acceptance and non-payment, Anderson .instituted suit against William Henderson, the partner, by way of petition, according to •the practice in Louisiana, as-follows:
    “ That the petitioner is holder and owner of a certain bill of exchange, for the sum of thirty-seveii hundred and ninety-five dollars, .drawn by Thomas J. Green, endorsed and directed "to Messrs. Briggs, Lacoste & Co., Natchez, which said bill was drawn tó the order, and was endorsed by John Henderson & Co., dated at War-renton, in the state of Mississippi, on the 3d February, 1837,- payable twelve months after dace, which said bill of exchange, on the 8th. of February, 1837, was protested for non-acceptance, and on the 6th day of February, 1838, the. day of maturity, was duly protested for non-payment by James B. Cook,'a notary public, in. the Sof Natchez^ duly commissioned and • qualified, and that said n Henderson & Co. was, by said notary, duly notified of said protest for non-acceptance, and for non-payment by, all of .which will appear by reference of said bill of exchange and protest thereof, apd' said bill of exchange annexed is made a part thereof.
    “At the. time-said-bill was endorsed, petitioner avers that said William Henderson-was a member of the late Commercial' firm of Johii Henderson & Co., formerly doing business at Warrenton,. under the said style ¿nd firm of John Henderson '& Co., and as a member of the said firm, he is now liable in solido to pay to. petitioner the amount of said bill of exchange, with, interest, cost, and .damages, and by the laws of the' state of Mississippi petitioner is entitled to five per cent, damages on the amount of said bill.
    “ Petitioner alleges further, that the ..said William Henderson, ' though amicably requested, has neglected to pay the amount or any part thereof, for which he is indebted as' aforesaid.”
    ' This petition was answered' as follows:
    .. “ Now comes the defendant in the above entitled cause, and, by way of exception, says: that he is not bound to answer, thereto; because he has not received, nor been served with/a true and exact copy of the petition, which by law he is entitled to, and that he-has riot been legally cited to appear and answer herein. Wherefore he. prays judgment, to be dismissed hence .with his costs, &c. •
    . “Arid if the foregoing exception be overruled, he pleads the general denial. He denies that he is in any manner liable to pay the bill of exchange sued on. He avers, specially, that he neither signed and endorsed said bill himself, nor in any way authorized . the name of said firm' of John Henderson & Co. to be. signed arid endorsed on the same; that it was so signed and endorsed as aforesaid by one John Henderson, without the • knowledge and consent of defendant, and without any authority whatever;. that such endorsement was made néither for the benefit, nor for any debt or liability, of the defendant or of said firm, nor was it made within the. scope of the partnership powers, of on account of said firin; ’ but .without any .due. authority,' and without the knowledge and consent of the defendant, the said bill was signed and- -endorsed as - aforesaid by said John Henderson, purely for the benefit and accommodation of. the' drawer, the .said Thomas J. Green: of all which the parties to said bill, and the holders thereof, before and after maturity, had due notice. Defendant requires strict proof of every allegation' in the petition.
    “Wherefore he prays judgment, with his costs, &c.”
    After sundry proceedings, a commission was issued to take the testimony-of John Henderson, the acting partner and endorser of the bill, and the cause came on for trial in February, 1842. At the trial, the court excluded the evidence thus taken, and there was a judgment for the plaintiff; but the following'bill of exceptions being taken to .the ruling of.-the court, the decision, came up for' review. , . -
    , . “Re it remembered, that on the trial of the above entitled cause, the defendant’s counsel, in order to prove the allegations set- forth by the defendant in his answer, offered in. evidence the deposition of one John Henderson, who, at the time of the drawing and endorsement of the- bill of exchange sued on, was a' copartner with defendant, the firm doing business under the name and style.of John Henderson & Co.; and especially in order to prove that said John ■ Henderson endorsed upon said bill the partnership name, without any authority whatever, without the knowledge or consent of defends ant, and contrary to their articles of co-partnership, and the course of dealing of said firm.; that it was so. endorsed in the presence of ■ the plaintiff, purely for .the accommodation of the drawer, Thomas J. Green, in discharge of a promissory* note held by the plaintiff against said Green; that said bill was not endorsed as aforesaid, for the accommodation, or on account of the said firm of John Henderson & Co., nor in any manner for the benefit of said firm of John Henderson & Co., norm any matter in which said firm was interested ; and that the plaintiff, when said bill was so drawn, and endorsed, and delivered to him, was fully cognisant of all the above facts. The plaintiff’s counsel objected to the reception of said deposition, on the ground that the said John Henderson was incompetent.to testify to any fact tending to invalidate the said bill, policy for the protection of commerce and the public morals. requiring the rejection of such evidénce.' The court, after taking time to consider, sustained tire objection, and rejected the deposition, T>n the ground.taken, as aforesaid, by the plaintiff’s counsel.
    “To this decision of the court, the defendant, takes this his bill of exceptions,.and prays that the same be allowed and signed by the court.”
    Conrad, for the plaintiff in error.
    This is an action by the holder of a bill.of exchange against one of the members of a commercial firm by which it purports to have been endorsed.
    The endorsement is admitted., but the defence is, that it was made by one member of the firm, without the knowledge or consent of his copartner, ’the defendant, solely for the accommodation .of the drawer, and in a matter in which 'the partnership had no interest or concern whatever.
    To prove these facts, the partner who made the endorsement of the firm on the bill was examined under a commission, and his deposition, to be found at page 17 of the record, does fully establish them.
    This deposition, however, was objected to on the ground that, being a party to the bill, he mould not impeach it by his testimony. The objection was sustained by the- court, and the deposition excluded. To this decision a bill of exceptions was taken, page 13 of the record, and the only question presented is as to the correctness of this decision.
    As Henderson had no interest in the event of the suit, his-general competency is not denied; .but it is said, on the authority of filie doctrine first distinctly laid down in Walton v. Shelly, that his tes-timpny is inadmissible so far as it goes to establish that the endorsement made by him was not binding on his copartners.
    . Apart from the sanction which the doctrine, that a witness Will not be permitted to impeach his own acts, derives from judicial deci- • sions, it is difficult to perceive on what rational grounds it .can rest. In either a moral or a legal point of view it seems equally untenable. In a moral aspect, to confess aifault, is in. some degree to atone for it; and what is under all circumstances a merit; becomes an.imperative duty, when the concealment of a fault by the one who had committed it would involve an innocent person in its consequences.
    In a legal point of view, the. doctrine appears equally-Unsound. The civil law maxim nemo allegans turpitudinem mam est audi-endus, invoked by Lord Mansfield in its support, is manifestly mis- . applied. Its proper application is to parties to the suit, not to witnesses. Its meaning is, that no man shall allege his own .turpitude , as the foundation of a claim or a right. It is equivalent to another axiom in that system, ex turpi causa non nasdtur actio, and is analogous to the common law principle thatNno- one shell take ad- •' vantage of his own wrong.”
    In fact, in all other' cáses courts of justice have adopted the opposite principle. The general rule’ is,' not only that á man may confess his own turpitude, but that he is bound to do so, whenever his confession will not subject him to a criminal prosecution; and even this exception, being established solely for the protection of the wit- ’ ness, may be waived by him. In criminal trials witnesses are every day allowed to prove crimes in the commission of which they aided and abetted. In chancery, (which ha's borrowed the practice from the civil law,) even parties may be compelled to disclose acts of fraud and moral turpitude.
    •It was no doubt a conviction, on the part of the .English courts that the rule was erroneous in principle _ and inconvenient in practice, that induced them first to limit its application to negotiable instruments, and finally.to abandon it-altogether. Jordaine v. Lash-brook, 7 Term Rep. 601.
    In this country, in some of the states the rule has never been followed. In others, where it had been originally adopted, the courts have been gradually receding from it.' Stafford v. Rice, 5 Cowen, 23; Powell v. Waters, 8 Cowen, 673; Williams v. Walbridge, 3 Wendell, 415.,
    The rule is now universally, held to apply only to negotiable paper.
    This limitation of the rules is a virtual abandonment of the ground on which it wras originally founded, inasmuch as the impropriety or indecency of allowing a man to contradict his own acts, can in no manner depend on the form or character; of the instrument thus sought to be impeached.
    The rule thus-restricted must rest, therefore, on another principle, to wit, the public policy of protecting negotiable paper. Now on this point, I will observe, first, that if the holder received the paper in good faith, he is sufficiently secured by the principle' which protects such paper in the hands of a bond fide holder against all equities that may exist between the original parties. If, on the contrary, he took the paper mala fide, there can be no good, reason why he should be protected, In the first hypothesis, the evidence would. be irrelevant; in the second, the reason for its exclusion does not exist.
    There aré, it is true, two exceptions to this remark, to wit, where the defence set up is that the note or bill originated .in a gaming or usurious consideration. In these cases the instrument, even in the hands of a bond fide holder, is tainted with the illegality of itsorigin. But is not this exception founded on considerations of public .policy? If so, how can a rule which excludes the" evidence of the facts be also founded on public policy? How can it be at the same time politic to allow the- consideration of negotiable paper to be inquired •into in these cases, and at the same time impolitic to prevent the introduction of the only evidence by which,-in'the great majority of cases, the facts can be established ?
    . At all events, if the object of the rule be to .protect negotiable paper in the hands of bond fide holders for a valuable consideration, (and we apprehend it can hardly be desirable to protect any other,) tiren the rule itself should be co-extensive with the object sought fo Be attained. As the only cases, therefore, where the consideration can in such cases be inquired into are those in which’usury or gaming is set up as a defence,, it would be sufficient for all tire public policy of the rule to say, that a.party to a negotiable instrument should-not be permitted-to prove that it originated in a gambling or usurious conside'ration.
    I have ventured on these general remarks in relation to the origin of this rule, because the rule itself is of recent origin, and the jurisprudence in regard to it, both in England and.in this country, is sa fluctuating, that I do not consider it as- firmly established.
    But we contend that the rule, even when carried as far as it has ever been by this court, does not-apply to the present case.'
    1. In the first place, for it to be applicable, the paper sought to be attacked must, not only be negotiable, but have been actually negotiated. U. S. v. Dunn, 5 Peters, 51; Same v. Liffler, 11 Peters, 91; Blagg v. Phcenix Ins. Co., 3 Wash. C. C. R. 7; Baird n; Cochrane, 4 Serg. .& Rawle, 397.'
    Now the draft in the present case is still in the hands of a party to the original transaction. ’ In point of form, it is true that the present-holder is the assignee of the payee and endorser, but iii point, of fact he was a party to the transaction in which it originated, and had full knowledge of the purposes for which it was executed. It was only a mode whereby the endorsers undertook to become sureties for a debt due by the drawers to the plaintiff. Powell v. Waters, 8 Cowen,,698’.

      2. Even supposing that the draft can be considered in a technical sense as having been negotiated, the endorsee certainly took it mala fide, and with a full knowledge that Henderson, in endorsing on it the signature of his firm, was committing a fraud on his copartners. Now, it is well settled that the rule does not apply to cases of fraud or misconduct to which the holder was a party. Peterson v. Willing, 3 Dallas, 506; Langer v. Felton, 1 Rawle, 141; McPherson v. Powers, 1 Serg. & Rawle, 102.
    3. The draft was drawn and payable in the state of Mississippi. Its nature and effect must, therefore, be tested by the laws of that state. Now, the law of that state provides, in substance, that in all cases where a promissory note or other obligation in writing has been assigned, the defendant shall be allowed the benefit of all want of lawful consideration, failure of consideration, payments, .discounts, and set-offs made, had, or possessed’against the same, previous to notice of the assignment, any law,-usage, or custom in any wise to the contrary notwithstanding, in the same manner as if the same had been sued and prosecuted by the obligee or payee therein. Law of June 25, 1822, sect. 12. See Howard & Hutchinson’s Dig. p. 372.
    By this law negotiable instruments are. placed precisely on the same footing with all other, securities, and, .therefore, the distinction on which alone the principle which prevents a party to an instrument from impeaching it by his testimony rests, is unknown in that state. The defence, in the present case, is want of consideration. Had the suit been brought by the assignee of an instrument not negotiable, the witness would unquestionably have been competent to prove this fact. But by the laws of Mississippi the assignee of a note or bill of exchange has no other or greater rights than the assignee of a bond or other instrument not negotiable in its character. "The-witness is, therefore, as/competent in the one as in the other. The case is similar to that of Baring v. Shippen, 2 Binney, 165.
    4. The lex fori must regulate the competency of witnesses, Story’s Conflict of Laws, 526, sect. 635; and by the law of Louisiana the witness was competent. Louisiana Code, art. 2260.
   Mr. Justice DANIEL

delivered the opinion of the court.

Upon a writ of error- to the Circuit Court of the -United States for the eastern district of Louisiana.

This was an action instituted at law in the Circuit Court-for the eastern district in the state above mentioned, by petition, according to the modes of proceeding in the courts of that state, in the name of. the defendant in error, as endorsee and holder of a bill of exchange for $3795, against the plaintiff in error, as an endorser of that bill.

The petition sets forth the facts following': That the petitioner is the holder and owner of the bill in question, which was drawn by one Thomas J. Green, at Warrenton, Mississippi, on the 3d of February., 1837, directed to Briggs, Lacoste, & Co., at Natchez, payable, twelve months after date, to John Henderson & Co., by whom it was endorsed. That on the 8th day of February, 1837, this bill was protested for non-acceptance, and on'the 6th day of February, 1838,. was duly protested for non-payment in Hie city pf Natchez, and that John- Henderson & Co. were regularly notified óf said protests for non-acceptance and non-payment. That at the time at which thesaid.Jbill was so endorsed, the-pjaintiff in error was a member of the firm of John Henderson & Co., then doing business at Warrenton in Mississippi, and as a member of that firm is liable to the petitioner for the amount of the bill of exchange, with interest, costs, and damages. That the petitioner is a citizen and resident of the state of Kentucky, and the said William Henderson, a citizen and inhabitant of the parish of Carroll, in the state of Louisiana. Upon the aforegoing petition the plaintiff below prayed judgment, With his costs, &c.

- The defendant below, in the first place, took an exception to the petition on the ground that he had not been served with a true copy thereof, according to law, nor had been legally cited to appear, and therefore prayed to be dismissed; secondly, he interposed what is there styled “the general denial,” corresponding with the general issue ; and thirdly, he averred specially, that he neither signed nor endorsed the said bill himself, nór in any way authorized die name, of (the: firm of John Henderson & Co. to be signed and endorsed on the same; that it was so signed and endorsed % one John Henderson without the. knowledge and consent of the defendant, and without any authority whatsoever; and that such endorsement was made neither for the benefit, nor for any debt or liability of the defendant, nor of the said firm; nor was it made within-'the scopé of the partnership powers, or .on account of the firm; but that without any due authority, and without the knowledge and consent of the defendant, the bill was signed and endorsed by said John Henderson purely for the benefit of the saidN’homas J. Green, the drawer, of all which the parties to the- said bill, and the holders thereof, before and after •the maturity thereof, had notice.

. At a subsequent day the exception first taken for the alleged want of regular service of tire petition, was waived bjf the defendant, and the cause was continued; afterwards, upon the trial thereof,^ the defendant, in order to prove the allegations in hi? answer to the petition, offered in evidence , the deposition of John Henderson, who, at the time of. the drawing and endorsement of the bill of exchange sued on, was a copartner with the defendant in the firm, doing business under the name- and style of John Henderson & Co.: this evidence being designed to. show that John Henderson endorsed the partnership name upon the bill without authority, without the knowledge or consent of the defendant, and contrary to their articles of copartnership and to the course of their dealings; and that it was so .endorsed, in the presence of the plaintiff, purely for the accommodation of the drawer, Thomas J. Green, and not for the accommodation, nor on account of, nór in any manner for the benefit of the firm .of John Henderson & Co. The reception of this deposition was objected to on the ground that John Henderson, as'a member' of the firm ■ by whom and at the time the endorsement wras made, was incompetent to testify to facts tending to invalidate the bill; the court sustained this objection, and rejected the deposition of John Henderson. • To. the ruling of the coúrt on this .point the-defendant took an exception, which was reserved to him.

The exception thus taken presents the whole controversy in this-case, which, controlled by principles heretofore ruled by this court, •would seem to be limited within a véry narrow compass. The inquiry how far a party'to a negotiable instrument maybe heard in a° court of law to impeaéh or invalidate that' instrument "in the hands of another, is one which, has led to considerable dispussion and-to different. conclusions in the courts both of England and in this country.In -tire case of Walton, assignee, &c., v. Shelly, 1 T. R. 296, the'Court of King’s Bench decided, that a party to a negotiable paper, having given it value and currency by the sanction of his name, shall not afterwards-invalidate it by showing,'upon his own testimony, that the consideration on which it was executed was illegal-. Subsequently, by the same court, this rule was so far relaxed or abrogated as to permit the impeachment of such an instrument by persons standing in the same relation to it. Vide Jordaine v. Lashbrook, 7 T. R. 601. Amongst the different states of.our union the decisions' of tire -Court of King’s Bénch on either side of this question have been adopted. In this court' the . rule laid down in the case of Walton v. Shelly has been admitted and adhered to with a uniformity which establishes it as the law of the court. Thus, in the case of the Bank of the United States v. Dunn, 6 Peters, 51, it was enforced -in an action by the holder of a note against an endorser, in which an attempt was made to impeach the note upon the testimony of a subsequent endorser; in tire case of the Bank of the Metropolis v. Jones, 8 Peters, 12, in which the maker of a note was deemed -an incompetent witness, in an action by the holder, to testify to facts in discharge of the liability of the endorser; and in the case of Scott v. Lloyd, the decision of this court, though not directly, upon the samé point, may. be regarded as approving the rule established by the cases -previously adjudicated. The judgment of the Circuit Court for the éastern district of Louisiana now under review'being fully sustained by these authorities, that judgment is hereby affirmed.


author: Mr. Justice McLEAN

text:
    Emily Poultney et al., Appellants, v. The City of Lafayette, Isaac T. Preston et al., Defendants.
    Before a case can be dismissed under the 21st rule, regulating equity practice, there must exist, in the technical sense, a plea or demurrer on the part of the defendant, which the plaintiif shall not have replied to or set down-for hearing before the second term of the court after filing the same.
    The complainant, if he chooses, may go to the hearing, on bill and answer.
    This was an appeal from the Circuit Court of the United States for East Louisiana; sitting as a court of equity.
    The heirs of Poultney filed a bill in chancery against the City of Lafayette and upwards of two hundred individuals.
    It alleged that Poultney had purchased from, the Widow Rousseau a tract of land about, a mile and a half above the city of New Orleans in May, 1818; and that to secure the payment of part of the purchase money, he had mortgaged the same' land, to her for. $80,000, payable in five annual instalments of $16,000 each; that Poultney died in October, 1819, leaving minor children, and that 1he defendants were in possession of the property, which .the complainants claimed a right to redeem.
    The proceedings which took place in court after this are exceedingly complicated. Some of the defendants answered, using this expression,'“ the said answer to serve and be instead of a demurrer and pleas to the. said.bill of complaint.” Objections-were made to the jurisdiction of the court-on account of the.residence of the complainants, and a rule granted to try the fact of residence, which rule •was afterwards set aside.
    The bill was taken pro confesso as to many of the defendants, who were afterwards allowed to answer; numerous persons were vouched in warranty by- the defendants, and afterweirds, the proceedings stricken out; demurrers were- filed and Overruled;-the case .was put upon the rule docket and then brought' back again; three more defendants were brought in.
    ■ The answers, amongst other matters, averred that' Poultney, at the .time of his death, was insolvent, and that the property in question had been subjected to the operation of the laws in Louisiana and sold to its present possessors.
    In 1842, the following proceedings took place.
    On' this first Monday of January, 1842, appeared Isaac T. Preston and C. Mi Conrad, Esquites, for defendants,- and. filed in' evidence with the clerk and master the. following exhibits marked A, B, C, D, E, F, G, I, M, N, O', P; and, on further motion of said-counsel, this cause is set for trial for hearing on the merits, for Friday, the 14th January, 1842.
    And afterwards, to wit,, on the 9th day of. February, one thou-' sand eight hundred and forty-two, the following entry was made of record, to wit:

      “ Wednesday, February 9, 1842.
    “ The court met, pursuant to adjournment. Present, the Honourable Theodore H..McCaleb, district judge; the Honourable John McKinley, presiding.judge, absent.
    Heirs of Poultney v. £.No. 37. The city of Lafayette et ais. j

      “ On motion of Isaac T. Preston, Esq., this cause was called on the docket and fixed for trial for Wednesday, the 23d February, 1842.»
    And'afterwárds, to wit, on the 23d of Februarv 1842, the following order of court was entered of record, to wit:
    ££ Wednesday, February 23, 1842.
    ££ The court met, pursuant to adjournment. Present, the Honourable Theodore H. McCaleb, district judge; the Honourable John McKinley, presiding judge, absent.
    Heirs of Poultney ~) v. bNo. 37. The city of Lafayette et ais. j
    “ On the 23d day of February, 1842, this case was called for trial; whereupon the complainants, by their , counsel, objected, upon the, .ground that the cause was improperly put on the issue docket, and ■set down for trial; that no replication had been filed, and that, since the last term of the court, some of the defendants had died, and their heirs or representatives had hot been made parties to the suit; and moved the court to remand thi cause to the rule docket, that an issue might beformed.< On the other hand, the defendants insisted that the case should proceed immediately to trial, or be. dismissed under the rules of practice presented by the Supreme Court in equity cases. These motions were all fully argued together, and, after argument thereof, the court took time to consider.”
    And afterwards, to wit, on the 24th day of Fébruary, one thousand eight hundred and forty-two, the following entry and decree were entered of record, to wit:
    “ Thursday, February 24, 1842.
    Heirs of Poultney } v. (-No. 37. The city of Lafayette ét ais. j

    ££ The court met, pursuant to adjournment. Present, Honourable Theodore H. McCaleb, district judge; Honourable John McKinley, presiding judge, absent.
    £<On this day the . court proceeded to deliver its opinion on the motions argued and submitted yesterday in this cause. When the court had announced it was about to deliver its opinion, the counsel for the complainants moved to be allowed to file tbe. documents A and B, but the court refused to receive them, stating that it was about to deliver an opinion on the cause; upon [which] the counsel for the complainants handed them to the clerk, the court considering that the complainants’ application to file a bill of revivor or exceptions caine too late.

      Decree of the Court.

    “ The defendants having moved to dismiss the bill of complaint in this cause, under the 21st of the rules in equity cases, and .it appearing tb the court that the complainants had hot set for trial the pleas filed in this case, nor filed replication to the answers, although moré than two terms of the court had elapsed since the filing of the same, it is ordered and adjudged, and decreed, that the bill of complaint in this case be dismissed as to all the defendants, and the complainants pay the costs of suit.”
    From which decree, the complainants appealed to this court.
    The case was. argued by Mr. Chinn (in writing) for the. appellants, and Mr. Coxe, for the appellees.
    The following is an extract from Mr. Chinn's argument:
    The bill in this cause was dismissed under the 21st rule of this court, prescribed for the inferior courts in chancery causes, because “ the plaintiffs had not set for trial the pleas filed, nor filed replications-to the answers, although two terms of the court had elapsed since filing the same.” To all this it is confidently responded, that there were no pleas filed in the cause. Some of the defendants, availing themselves of the 23d rule of'practice, instead of filing a formal demurrer, or plea, did insist on some special matter in the answers, which they left with the clerk of the court, and claimed to have the benefit thereof, as though they had pleaded the same matter. They commence “ The several - answer of,” &c. — “ The said, answer also tb. serve and be insteád of a demurrer and pleas to the said bill of complaint.” — Was there then a plea in the cause? Surely not. There was something else; thére was an .answer to serve and be instead of a plea, and of which the party Claimed the advantage, as under the answer and not under a plea: and so it was regarded by the court when an application wás made to it to try the question of citizenship: — and although the party could avail hunself of all the matter, by way of answer, the plaintiff could not otherwise regard it than as an answer, and could do no otherwise towards forming an issue, without leave of court, than file a general replication to it, as an answer.
    It is said, in the order dismissing the bill, that more than two' terms had elapsed since filing the pleas. Now if the most rigid and technical interpretation of the rules are to be had, and they shall be conformed to to the letter, it becomes important to ascertain when the pleas of the defendant were filed. The answers of some of the defendants appear to have been lodged with the clerk of the court in his office, on the day of ; there was no notice taken of them upon the rule docket or in the minutes of the court, and consequently they were not parts of the record; the defendants were not bound by them,-and the’' complainants were rot notified of their being on file. On the 24th, 30th, and -31st of Pecember, 1839, arifl on the 19th February, 1840, notes are made upon the rule docket of the filing of answers upon those days, hut fipthing is said about the filing of pleas. Neither of those days were' or could have been rule days; consequently the act- was nugatory. On the 24th of December; 1839, a motion was'sustained to set aside the decree nisi, and .leave was given the- defendants to file answers, which does not appear from the minutes then, to- have been done; and the complainants were,‘by order of. the court, protected in their right thereafter to file any exception to the answers that .might be filed. Let it he borne in mind, that the decree jmsi was set . aside without putting the parties defendant upon any. terms whatever; they were not even compelled, to pay costs.
    In the answers various record and documents are properly referred to as exhibits, and constitute, parts of the answers — rthe most. mate-, rial and only important parts, and without the fifing pi which the plaintiff could not safely proceed in making up' an issue in the cause. At the January, rules, 1842, these exhibits were, for the first time filed, and'noted upon the rule docket — they never having been before even- lodged with- the' clerk.- Up? to that time the filing of answers was not complete; then for the first time the cause stood upon bill and answer — and at, the same time the cause was set for hearing by the defendants, on the merits, for Friday, the 14th Janu- ' ary, 1842; • at the same time they suggested the death of Layton, and the names of his heirs, and look an order at the rules the: they be parties. There was then clearly a misconception by the court, that more than two terms had elapsed since the filing of the pleas and before the order dismissing the bill.
    It doth clearly appear from the 17th rulé, that issues are to be formed, and causes are to be prepared for trial, at the rules and upon the rule days, and .that neither party is bound to notice the proceedings of his adversary except they be-then entéred in the rule book, or they be had in open court. ■ ■
    The court below predicated its order dismissing the bill somewhat upon the failure of the plaintiffs to file replications to the answers, and suffering .two terms to expire.
    • Pending a motion made by the complainants to set aside the rule for hearing of the cause upon its merits, and to remand the cause to the rule docket, that an issue might be had, and during the argument of-that .motion, the defendants moved to dismiss the bill under the 21st rule, without any previous rulé therefor,-without -any previous notice thereof, and in direct conflict with their' rule for a trial of the cause upon its merits, which .they had taken. The' court, in pronouncing the order,-says: “The defendants having moved to-dismiss under the 21st rule, and it appearing to the court that the complainants had not set for trial the pleas filed, nor filed replications to the answers, although two terms of the court had elapsed since the filing the same, it is ordered and adjudged, and decreed, that the suit be dismissed “ as to all of the defendants.” In response, therefore, to an application to remand the cause to the rules, and in response to an application to dismiss under the 2Í'st- rule, he does dismiss under that rule; and because the plaintiff had not replied to the answers.
    The plaintiffs were- not bound to notice or reply: to the answers until two calendar months after they were put in, filed at the rules, or in open court; and upon their failure to reply, or file exceptions; they might be ruled to reply; and upon the expiration of that rule, and no replication or exceptions filed, the suit might .be dismissed: but even then, in the 'discretion of th- ' court, the cause might be retained upon the payment of cost. — 1 ¿le 13th. Rut in this case •there had been no rule for replication.- 'No pains of dismissal could be inflicted upon the plaintiff for failing to reply, until he was ruled to do so. It was then a vain invocation of the 13th rulé to sanction a dismissal moved for under the 21st. ■
    After filing a replication it would be .too late to except to an answer; but the courts, in the-exercise of a sound discretion, and for -the attainment of justice, would suffer the replication to be withdrawn and excéptions had. But; at any time before replication, it is the right of the plaintiff, at the rules or in open court, to file exceptions to the defendants’ anáwers; and this right was particularly secured to the plaintiffs, without limitation as to time, ppon setting aside the decree nisi. The court will not ordinarily set aside a decree nisi, until the coming in of a sufficient answer. In this case, the rule was ex gratia departed from; reserving the right. of the plaintiffs to reply to the answers when they should’.come m.-
    Upon the trial of the plaintiffs’ motion, and' before the decision thereof — when there had been no rule for replication, and the party’s right to file exceptions to the defendants? answers would appear to have been unquestionable — they offered to do so, but the court refused them permission; and, inasmuch as -Robert Layton had subsequently to the preceding term departed this life, and his heirs were not properly before the.court, the plaintiffs offered to file a bill of revivor against them, which the court refused to permit: and without accepting any terms, or putting the plaintiff upon any terms to speed'the cause, put an end to the cause by pronouncing a final decree — und did not, even in that, reserve to the plaintiffs the right to commence de novo,
    It is supposed that the decretal order dismissing the plaintiffs’ bill •is-erroneous-for its ambiguity, and want of reasonable judicial certainty. After dismissing the bill as to all the defendants — which applies-to all who had been served with or who had been made defendants in the bill, and who had not answered — the decree proceeds: “ and the complainants pay the costs of suit with regard to such of the defendants as had-filed pleas of demurrers — the complainant having failed to reply to or set for hearing such pleas or demurrers before the second term of the court after filing the same, agreeably to the 21st of the rules of practice for the courts of equity of the United States, as' prescribed by the Supreme Court of the United States.”
    Proctor filed the only demurrer that was filed in the cause. An issue was had speedily. ' It was set for hearing, -and inasmuch as Layton and others relied upon the same matters, they were all heard. The demurrers were overruled, and the defendants ordered to answer over, which Proctor has never done, notwithstanding which he has succeeded in turning the plaintiff out of court. Now can this court ascertain from .the decree, which of the persons named as defendants, in the complainants’ bill are entitled to their costs ? &c., &c.
    We therefore conclude that the infei ior court erred,—
    1. In deciding that the defendants, or any of them, had filed pleas in the cause.
    2. That the failure of the plaintiffs to set such pleas down for trial should be visited with the pains of dismissal of their bill.
    3. That the plaintiffs were in default in not replying to the defendants’ answers.
    4. In refusing leave to the' plaintiffs to file exceptions to the answers, and a bill of revivor against the heirs of a deceased party.
    5. In disihissing the plaintiffs’ bill as to all or any of the parties.
    6. In awarding costs to the defendants, or any of them, and .not defining to whom.
    7. In refusing to award a rehearing of the case upon the petition and affidavit filed.

      Coxe, for appellees, said that after the case was argued in the court below, and when the court' was about to deliver its opinion, some papers were presented,' but the court very properly said it was too late. The printed’ argument refers to the position of the case when the judge decided it; and thére was nothing in this position to prevent the complainants from filing a replication. Thé record shows that they endeavoured to excuse themsefres for this- omission by filing -a petition for a re-hearing; and it is, in fact, from the refusal ofthe court to grant this that the- appeal was taken.
   Mr. Justice McLEAN

delivered the opinion of the court.

This is an appeal from the decree of the Circuit Court for the eastern -district of Louisiana.

To determine the point brought up by the appeal, it is unnecessary to state the substance of the bill-or answers. On motion, the Circuit Court dismissed the bill, under the 21st nlle, because the “complainants had not set - down, if or hearing the pleas filed in this ease, nor filed replication to the answers, although more than two terms-of the-court had elapsed since filing of the same.”

The rule referred to is,- “if the.plaintiff shall not reply to, or set for hearing any plea or demurrer béfore the second term of the court after filing the same, the bill may be dismissed, with costs.” No plea had been filed in .the case, and'the demurrer filed had been overruled, so that the rule did not apply to the case as it stood at the time of the dismissal. The rule can only apply to demurrers and pleas technically so called. And there is no other rule of proceeding which authorized the décree of the court. The complainant may, if he choose, go to the hearing on the bill and answer.

The decree of the Circuit Court is reversed, and the cause is remanded for further proceedings.