Harwood v. Jones , 10 G. & J. 404 ( 1839 )

Dorset, J.,

delivered the opinion of this court.

Before we examine the facts in this case, it is necessary to dispose of the questions raised, as to the admissibility of portions of the evidence taken in the cause, because upon their determination will in some measure depend what are the facts ,on which we are called to decide.

The first objection of this kind was taken to the testimony of Charles A. Warfield, who it appears was examined as a witness on the part of the appellants, without any previous notice ■thereof being given to the appellee. Previous to the act of assembly of 1832, ch. 302, sec. 5, such an objection to testimony, if taken in this court, must have been sustained. But the .act of assembly referred to, is conclusive against the allowance ■of any such objection in the appellate court; unless it appears by the record that it was raised by way of exception in the .court below.

The next objection to the testimony is, to the evidence of Dennis H. Battee, who, it appears, though a defendant in the cause, was examined under the commission, without a previ.ous order for that purpose having been obtained from the county court. Had this irregularity been made the subject of an exception to the testimony in the county court, it might have been available to the appellants in this court. But no such .exception having been there made, the act of 1832 in terms the most imperative prohibits its being “noticed, or determined, or acted upon” by this tribunal.

The questions of evidence following those of which we have spoken, arise upon the answer of Lucy Harwood, one of the defendants in the court below. It is insisted, on behalf of the appellee, that her answer is evidence against her co-defendants, who claim title under her. In support of this position it is asserted, that the declarations or answers of a nominal plaintiff, after he has assigned all his interest in the chose in .action sued on, are evidence at law against the cestui que use: and being so at law, they are equally so in a court of equity. Without stopping to examine the correctness of the first branch of this proposition, that such declarations or answers are evidence at law to destroy the rights of the beneficial plaintiff;, does the second branch of the appellee’s position follow as a necessary consequence of the admission of the first? We think not. The principle, with the reasons upon which it is founded, that the answer of one co-defendant is not evidence against another, is stated with great perspicuity by the learned judge' who delivered the opinion of this court in the case of Hayward vs. Carroll, 4 Harr. & John. 518, from which the following is-an extract: “It is an established principle of evidence, that the answer of one defendant cannot be read in evidence against-a co-defendant. If the complainants were interested in establishing a fact by the evidence of a co-defendant, they might have examined him, as a witness, on interrogatories, and the' witness then would have been subject to the cross-interrogatories of the other defendant. To withhold from such defendant the privilege of cross-examination, would be unjust, and this-injustice must necessarily result from the practice of permitting' the answer of one defendant to be read in evidence against a eo-defendant.” Now a nominal plaintiff cannot at law be~ compelled by the defendant to submit to examination as a witness in the cause. If we were then for this reason to concede the correctness of the first branch of the appellee’s position,., the second branch is not established by it; because, it is sustained by no such reason. A defendant in chancery, a nominal party, may be examined as a witness against his cestui qu& use, a co-defendant. It must, however, be admitted, that the appellee has referred to two adjudications, which, if followed by this court, would render the answer of Lucy Harwood evidence against her co-defendant Mayhew. And these decisions-emanate from that learned tribunal, with which we have ever' concurred with confidence and differed with distrust.

The cases referred to are those of Field vs. Holland, 6 Cran. 8, and Osborn vs. The United States Bank, 9 Wheat. 738. We have given to them a thorough examination and respectful consideration, but not being convinced of their correctness by the reasons assigned in their support, and being unable to reconcile them to an otherwise unbroken series of authorities, both English and American, we do not hold ourselves bound to conform to them.

Entertaining these view's, we cannot do otherwise than say,that the answer of Lucy Harwood is no evidence against the co-defendants. If her testimony were material to the appellee, he should have obtained it by examining her as a witness in the customary mode. As authorities in point on this branch of the case, see Phœnix vs. Dey & al., 5 Johns. 412. 1 Stark. Ev. 284, 285, and the cases there referred to. Hughes & Ballinger vs. Worley, 1 Bibb. 200. Bullett vs. Marshall, 2 Bibb. 470. White vs. Robinson, 1 A. K. Marshall, 567. Hunt & Blanton vs. Stevenson, 1 Ib. 570.

The next objection to the testimony in behalf of the appellee is, that it is inadmissible, being oral evidence of a written contract between Samuel, Joshua and JohnR. Jones, wdiicb written contract, it is alleged, is the assignment executed by John R. Jones to Samuel Jones. If the oral contract leferred to, had been reduced to writing by the parties, or if if -was intended that the assignment should be such written contract of the parties; then might it be contended, in the absence of all proof of fraud, surprise or mistake, that the oral evidence, offered by the appellee was inadmissible. But it is manifest from the proofs in the cause that the agreement entered into never was reduced to writing; and there is nothing in the record to show that it ever was intended to be reduced to writing. The assignment was not intended to be the written agreement of the parties; it was nothing more than an act done by one of the parties in execution of the oral agreement into which he had entered. With as much propriety might it be contended, if the assignment, instead of being in writing, had been orally made by an actual delivery to the trustee, under and in conformity to the agreement which had been previously entered into, that such oral assignment or delivery was the only appropriate evidence that could be offered of the agreement. The oral contract in this case, made between the parties (apart from the time of its complete execution being postponed to a period beyond a year from its date, of the consequence of which we shall hereafter speak,) is as valid and obligatory, as if it had been reduced to writing. Suppose then the contract, at the time it was made, had been reduced to writing and signed by the parties, and subsequently, in execution thereof, this assignment had been executed by John R. Jones, would it be pretended that, the assignment was the written contract of the parties, and superseded and annulled the written agreement previously executed? Certainly not. So neither does it supersede or annul the valid oral contract previously entered into. It was not designed to be the written evidence of the contract of the parties, but the mere act of one of them, performed in execution of it, and upon no principle of reason, law or justice, can it have the operation attempted to be imputed to it. The testimony therefore is not objectionable on this ground.

It has been objected to, also, on another ground, that being to be performed more than one year after the time the contract was entered into, the statute of 29 Car. 2, chap. 3, which has been pleaded, prohibits the establishment of the contract by other than written proof.

We think this defence can avail the defendants nothing. Under the assignment Jones 8r Hardesty have received a full and valuable consideration for the performance of their part of the agreement, and to permit them or those claiming under them, now to set up the defence of the statute in bar to the specific execution of the contract, would be a fraud upon the appellee, and in such cases courts of equity, interposing for the prevention of frauds, will decree the specific execution of the contracts, regarding such cases as without the purview and design of the statute.

And upon the same principle, they will interfere by injunction in a case like the present, to restrain a plaintiff from enforcing a legal right against all equity and conscience. Another objection insisted on against the testimony, is, that it is an attempt to establish by oral proof, a promise to pay the debt of another, contrary to the statute of frauds. If this were an effort on the part of a creditor, seeking to charge a third per* son with a debt already due to him from another, there might be some plausibility in the argument.

It would be an effort to establish orally, two subsisting liabilities to the same person, for the same debt; which is clearly prohibited by the statute. But such is not the design, nor the-effect of the testimony offered in this case. It is a new and! original promise to a debtor, founded (as must be assumed in this aspect of the case) upon a full consideration to discharge a 'debt due by such debtor, and is no more a case within the-statute, than it would have been if the promise had been, instead of paying a subsisting debt, to pay to the debtor a sum of money of the same amount...

Much has been said in relation to the declarations of John R. Jones, touching the matter in dispute in this cause. ’Tistrue, they are testimony; no exception to their admissibility having been taken in the county court, as required by the act of 1832. But when discredited by the answer of John R. Jones, which is competent evidence for that purpose, they are entitled to no weight or consideration in the determination of' the case.

Having disposed of the several objections raised on the evidence in the cause, we will now proceed to consider the several legal grounds, which have been urged in bar to the relief sought by the appellee.-. And first in its order, is the objection to the jurisdiction of this court; the equity, it is alleged, upon which relief is sought in this case, being a complete legal defence, of which the appellee might and ought to have-' availed himself in the county court in the suit upon the bond. To this objection the answer is natural and easy. If the agreement were, as we are inclined to regard it, a promise on the-part of Jones fy Hardesty to pay Lucy Harwood’s bond when-it became due, more than two years afterwards, it was, as contended by the appellants, embraced by the statute of frauds, and therefore void at law, and could only be enforced in a court of equity upon the principles before stated. Upon another ground we think the appellee was not bound to have made ■ Ms defence at law. The defence rested altogether upon mat— ters done in execution of an express trust, where the effect of trustee’s acts mainly depended on his intention in doing the acts. In such a case we think the appellee was not bound (conceding to him the power to have done so) to have made his defence at law, but was at liberty to have gone for redress into a court of equity, where be might purge the conscience of the trustee in relation to the subjects matter in controversy.

The next reason assigned for the reversal of this decree is, that the promise of Jones in behalf of Jones fy Hardesty, to pay Lucy Harwood’s bond, is a nudum pactum; and therefore, ■of no obligation either at law or in equity. After reading the testimony, it is difficult to conceive upon what ground such a suggestion could have been made. We do not mean to discuss tbe question, further than to say, that the consideration proved, is abundantly sufficient to support a promise at law or in equity.

Tbe decree of the county court, it is said, must be reversed on account of the variance between the allegations in the bill and tbe proofs in the cause. Whether there be such variance or not, we have deemed it unnecessary to inquire, because, according to our interpretation of the 5th section of the act of 1832, ch. 302, it is immaterial whether there exist such variance or not; no exceptions having been filed in the court below, either to the admissibility of the evidence, or the sufficiency of the averments of the bill, the complainant is entitled to an affirmance of the decree in this court, if warranted by the proof, whether his allegata and probata correspond or not.

In behalf of the appellant Mayhew it is insisted that, under the act of 1829, ch. 51, he is authorised as assignee of the bond, to sue thereon in his own name, and consequently, that he took the bond discharged from the equity interposed by the obligor to its recovery. Without stopping to examine how far Mayhew is such an assignee, as under the act of 1829 is competent to sue in his own name, let us see how far, under the .act of assembly, his rights as against the obligor have been protected and enlarged. The preamble to the act, as well as the enacting clause, shews that the design of the legislature was no further to extend the powers, or enlarge the rights, of the assignee, than to enable him to sue in his own name. And the saving clause reserves to the obligor or debtor, “all such legal or equitable defence, as might or could have been had and maintained against the assignor or assignors, at the time and before notice of such assignment, in the same manner and to the same extent as if no such assignment had been made.” We think, therefore, that this act of assembly does not impair or change the rights, either legal or equitable, of the obligor or debtor, whether the suit be instituted in the name of the assignor or assignee. But it is insisted that the equitable relief sought by the appellee in this case, cannot be extended to him, because Mayhew the assignee is a bona fide purchaser for a valuable consideration without notice. The assignee before us, stands entitled to no such protection, either upon principles of law or equity, if he were such a purchaser, or upon, the facts in the cause as disclosed by the record. His answer— the only evidence upon the subject — demonstrates that he never purchased the bond; that he never paid or advanced one dollar as the consideration for the assignment; on the contrary, that it was placed in his hands for collection, and that when collected, he was to carry the proceeds to the credit of a debt antecedently due to him from Jones §■ Hardesty. Mayhem -stands before the court clothed with none of the attributes of a bona fide purchaser, without notice. But suppose he did— as respects the equities or defences of the appellee, either at law or equity, his condition is unchanged. He who takes an assignment of a chose in action not negotiable, takes it subject to all the legal and equitable defences of the obligor or debtor, to which it was subject in the hands of the assignor. If he accepts the assignment in ignorance of their existence, without using the appropriate means of acquiring a knowledge of them, the consequences are the merited result of his negligence. It is his duty, if he wishes to avoid the effects of secret equities, to seek information from the obligor or debtor, who, if he withholds it when properly applied to for its disclosure, must submit to the consequences which are visited upon fraudulent concealment.

An objection has been raised to the decree, that a necessary party is not before the court; that the administratrix of Samuel Jones should have been made a defendant. We think this objection furnishes no ground for the reversal of the decree of the county court. The complainants seek no decree, and, according to the proofs in the cause, eould obtain none against the representatives of Samuel Jones. In receiving the assignment, he acted for and in behalf of Jones ‡ Hardesty, and was in effect the mere instrument, or conduit, through which the property assigned passed to them. By his death all the partnership property and responsibilities of the firm, devolved on Hardesty, as the surviving partner, who is hound for the performance of all contracts and engagements in relation to the partnership business, entered into by his deceased partner, for the benefit and in behalf of the firm.

The various legal objections to the decree before us having been examined, we must now see how far the proofs in the cause entitle the appellee to the relief he has received at the hands of the county court. Looking to the bill of complaint and the answer of Mayhew, and the uncontradicted testimony of the witnesses, William Turnbull and Dennis II. Battee, it satisfactorily appears to this court that Samuel Jones did, for and in behalf of the firm of Jones Hardesty, for a valuable consideration, moving from John R. Jones, promise to pay the bond for $2000, to Lacy Harwood at its maturity, out of the funds received under the assignment made by John R. Jones; and that in the event of the insufficiency of those funds for that purpose, that Joshua Jones should contribute to its payment to the amount of two hundred dollars. It does not sufficiently appear by the proof in the record, that an adequate amount of the funds collected under the assignment, and applicable to the payment of the bond, have come into the hands of Jones 4r Hardesty, or of Hardesty the surviving partner. The pro forma decree of the county court is therefore erroneous in enjoining the judgment for the whole amount. The perpetual injunction awarded by the decree of the county court should have left the plaintiffs at liberty to issue an execution on the judgment, for the sum of two hundred dollars, with interest thereon from the day when the bond was payable, and costs of suit. This court will therefore pass a decree reversing the pro forma decree of the county court, but without costs, and decreeing a perpetual injunction as above mentioned, but without costs to either party.

DECREE REVERSED IN PART.