Arey v. Hall , 81 Me. 17 ( 1888 )

Peters, C. J.

The claim here in suit is for money had and received by the defendants of a person who sues in the name of an assignee. It will be convenient to speak of such person as the plaintiff.

He and the numerous defendants were, in 1885, owners, as tenants in common, of a schooner which hailed from Bueksport, wdiere the owners resided. One of the owners, S. P. Hall, was ship’s husband. In May of that year the vessel went ashore on Nantucket, and bills were incurred for her preservation and repair. Hall, then in good financial credit, without the knowledge or authority of his associates, procured from the plaintiff, at the plaintiff’s suggestion, 1700.00 with which to pay the bills on the vessel, giving his own note therefor, reading as follows;,

“Buokspobt May 28, 1885.

$700. Borrowed and received of A. S. Arey seven hundred dollars to pay bills on the schooner J. G. Stover, it being for wreckers and repairs bills, payable on demand and interest.

S. P. Hall,

Agent for schooner J. G. Stover and owners.”

Hall placed the money in bank to his private credit with one or two hundred dollars of other money, and paid the bills by drawing cheeks on the bank account for their respective amounts.. He did not at the time place the borrowed funds to the credit of. the owners, nor render it to them in any account until after his insolvency and failure occurred two years afterwards. Hall owed the owners $300.00 for the vessel’s earnings when he borrowed of plaintiff, and $1300.00 when he failed, exclusive of the borrowed money. The plaintiff made no demand for his money, not needing it for his own use, until this suit was instituted.

The plaintiff endeavors (in the name of the assignee) to maintain the action by proving that the money he loaned to Hall was actually expended to pay the bills against the vessel.

It is not pretended that Hall was authorized to borrow the money on the personal credit of the owners. Clearly, he was not. If he could borrow money for one purpose, he might use it for another purpose, and therefore the law does not invest a ship’s husband with such authority. Of course, he might be expressly authorized by the owners to borrow. He may contract bills against the vessel, though he may not borrow money on the vessel’s account to pay them. 3 Kent Com. 187. Story Agen. (9th ed.) § 35, and note. 1 Bell. Com. (5th ed.) 504.

The plaintiff, however, contends that he is entitled to recover upon another ground, which is that the owners have enjoyed the benefit of the money in the payment of their debts, and cannot retain that benefit without rendering to the plaintiff compensation therefor. It is contended that the defendants, by refusing restitution, have ratified the act of their agent. It is not difficult to see that such a sweeping proposition would almost entirely .subvert the principles of agency before mentioned. It makes the principal liable in all cases for unauthorized borrowings by his ;agent, provided the agent expends the money in the management iof the principal’s business, regardless of the existence of any equities •or necessities which should exonerate the principal from mailing restitution.

It is well settled, as a general rule, that a person who has received the benefit of the,money or property of another, is not liable to such person therefor, in the absence of contract between the parties, if there be any ground upon which the money, or property or its benefit, may be rightfully retained by its possessor without accounting to the owner. Ratification of another’s act does not result in such case. It is the wrongful keeping of another’s property, which creates liability to him.

There are several reasons why this rule is applicable to the facts of the present case.

In the first place, it is at least doubtful if, in a legal sense, it was plaintiff’s money that went to the benefit of the defendants. It was legally loaned to Hall. Hall was and still is liable on the note. As one of the owners he surely does not wrongfully retain the money. He merely neglects to pay his note. There is a difference between money, which has no ear mark, and other property. Dwinel v. Sawyer, 53 Maine, 24. Thatcher v. Pray, 113 Mass. 291.

It was held, in White v. Sanders, 32 Maine, 188, that, if one wrongfully sell the plaintiff’s goods, the receipt of money from him by the plaintiff on account of the goods, would not be a ratification of the sale, provided the plaintiff would have a right, without ratifying the sale, to keep the money. Hastings v. Bangor House Proprietors, 18 Maine, 436, is a marked illxxstration of the same principle.

One reason why the defendants are not wrongfully withholding the borrowed money, is that they are xxnable to restore it. It has gone into the vessel without the defendants knowing they were receiving the plaintiff’s money. It was held in Davis v. School District, 24 Maine, 349, that a school district cannot be considered as promising to pay for xuiaxxthorized repairs on their school-house, by using it afterwards. They could restore what they had received only by an abandonment of their property, and that they were not obliged to do. School District v. Ætna Ins. Co., 62 Maine, 330.

Further, the defendants’ condition has become changed, without notice of the plaintiff’s claim. Instead of being indebted to the ship’s husband, he has become a debtor to them in a larger sum than the plaintiff’s claim, and is insolvent. The plaintiff has slept on his claim. Bryant v. Moore, 26 Maine, 84.

The town cases, relied on by the plaintiff, properly understood, are not inconsistent with these views, and do not support the plaintiff’s contention. In the first of them the doctrine was rather too broadly stated, 72 Maine, 522, and in Lincoln v. Stockton, 75 Maine, 141, some qualification of the doctrine of previous cases was intended; and in Otis v. Stockton, 76 Maine, 506, the doctrine is enunciated more satisfactorily.

Another difficulty which is in the way óf a recovery in this action, is that no action at law for contributions for advances by one owner can be maintained against the other owners jointly. A joint remedy must be in equity. And the assignee can have no greater right in this respect than the assignor. An owner cannot enlarge his claim against co-owners by selling it. ■

Plaintiff nonsuit.

Daneorth, Llbbey, Emery, Foster and Haskell, JJ., concurred.