Herbert v. Ford , 29 Me. 546 ( 1849 )

The opinion of the Court, (Howard, J. concurring in the result only,) was delivered by

'Wells, J.

It appears by the facts stated in the bill of exceptions, that the note in suit was given for the good will of the professional practice of Doct. Albert S. Clark, in the town of Bristol, and by the agreement of the parties, it was made payable to the plaintiff, as the agent of Clark. The plaintiff holds it for Clark, and it is open to any defence, which might be made against the latter. Petry v. Christy, 19 Johns. 52.

Four or five years after the note was given, Clark returned to Bristol, and resumed his practice. Several payments had been made upon the note, and this suit was brought to recover the balance. The defence set up was a want or failure of consideration, equal at least, to the balance due on the note, which was not negotiable.

The Judge of the District Court instructed the jury, that inasmuch as the failure of consideration was not total, but partial, and the part which had failed, if any, was uncertain and not capable of computation, it would constitute no de-fence. By the common law, any legal consideration is sufficient to form the basis of a contract, and consequently, it must be entirely wanting of that ingredient, to render it a nudum pactum.

Whether a partial failure of consideration may be given in evidence, to defeat a recovery pro tanto, has been very much discussed, and has created conflicting decisions.

In New York and other States, a partial as well as a total failure of consideration, may be given in evidence by the maker of a note, to defeat or mitigate, as the case may be, the recovery. 2 Kent’s Com. 474; Earl v. Page, 6 N. H. 477. The note in suit, in Parish v. Stone, 14 Pick. 198, was given upon two distinct and independent considerations, one alone of which was valid in law, but both were blended together, and neither was definite or liquidated. It was decided, that the plaintiff could recover to the extent of the valid consideration and no further, and that the amount should be settled by the jury, upon the evidence. This case appears to cover the whole ground in controversy, for if a partial want of consideration, which is unliquidated, may be shown, no apparent objection could arise to showing a partial failure, which was also unliquidated.

In Tye v. Gwynne, 2 Camp. 346, Lord Ellenborough says, the want of consideration may be given in evidence to re-dace the damages, bat a failure cannot, that furnishes a distinct and independent cause of action. No judgment was rendered in that case, which, with a cross action between the parties, was referred to arbitration.

If there be a salé of two chattels, for a gross sum, and a note given for the price, and one of the chattels is not the property of the vendor, and a partial want of consideration may be shown, why should not the same defence be allowed, if both of the chattels were the property of the vendor, and the title passed to the vendee, but the vendor destroyed one of them before delivery ? In one case, there is a want of consideration, at the time when the contract is made, to the extent of the value of one of the chattels, in the other a failure of it, to the same extent, caused by the misconduct of the vendor. There does not appear to be any good reason, why the maker of the note might not defend on one ground as well as on the other. Accordingly it has been held, in Dyer v. Homer, 22 Pick. 53, where there was a sale of chattels, which was considered valid between the parties, but not so as to attaching creditors, and some of the chattels were taken and held by an attaching creditor, that the maker of the note, given for them, might prove the partial failure of the consideration, in an action on the note.

Nor is it necessary in making this defence, that there should be a restoration, by the party who sets it up, of what he has received under the contract.

In the case of Harrington v. Stratton, 22 Pick. 510, where a note was given upon an exchange of horses, and the payee represented his horse to be sound, when he was not, the defendant was allowed to prove in reduction of damages, the defect in the horse received by him, without returning or tendering it to the plaintiff.

The same principle was adopted in Goodwin v. Morse, 9 Metc. 278, where the chattel sold, was not such in quality as it was warranted to be. So also in Stevens v. McIntire, 14 Maine, 14, where a note was given for a bond, for the conveyance of land, and there was a mistake in the amount, for which the note was given, it having been made for too large a sum, the defendant was allowed to show the same, in reduction of damages, without, returning the bond.

It is true, where the purchaser would rescind the contract, and recover back what he has paid, ho must restore what he has received.

Rut in such case he becomes the actor, and brings his action for redress. It is also well settled, that he may recover in an action for the fraud or breach of warranty, retaining what he has purchased.

It does not follow that because these two remedies are open to him, he may not also prove in reduction of damages, when he is sued upon the note, that there were fraudulent representations made to him by the payee, a warranty which has been broken, or any partial failure of consideration.

By the allowance of such defences, in those cases, where the defendant would have a right to maintain a cross action and recover damages, an unnecessary circuity of action is avoided.

In the present case, there cannot be an entire restoration of what was purchased, after the defendant had received a part of the beneiit of it, but be would undoubtedly be entitled to recover damages, if he had sustained any, for the breach of the contract. And those damages may as well be investigated in an action upon the note, as in a cross action, if the plaintiff has proper notice of the defence. And the jury can as well determine them, in the one case as in the other.

There are no reasons of public policy, which would shut out this defence, or that would require a party should recover to-day, what it is conceded he must pay back to-morrow.

The case of Lloyd v. Jewell, I Greenl. 352, was doubted by Pakkek, C. J. in Knapp v. Lee, 3 Pick. 452, and was considered by him to be at variance, with the doctrine laid down in Bliss v. Negus, 8 Mass. 46. It was also questioned by RichakdsoN, C. J. in Tillotson v. Grapes, 4 N. H. 444. And the ground of the opinion, that the covenants were a sufficient consideration for the note, was denied to be the law of Massachusetts, in Rice v. Goddard, 14 Pick. 293. The objection made to the case of Lloyd v. Jewell, as appears by the cases cited, in Massachusetts and New Hampshire, does not seem to arise from the ground of the decision of that case, that a partial failure of consideration could not be given in evidence, but to the remarks of Mellen, C. J. that a total failure could not. The decision in that case was made according to the rule of the English law, which remits the party back to his covenants in his deed. But the English courts admit a total failure of consideration to be a good defence, between the original parties to a bill of exchange, while they hold a partial failure is no defence. 2 Kent’s Corn. 473.

The authority of Lloyd v. Jewell, in which there was only a partial failure of consideration, is recognized in Wentworth v. Goodwin, 21 Maine, 150, and in Jenness v. Parker, 24 Maine, 289.

The present action does not relate to real estate, a conveyance of which with covenants of warranty, was the consideration of the note in Lloyd v. Jewell. If Clark, by resuming his practice, has prevented the defendant from enjoying the entire benefit of the contract, he ought not, through the plaintiff, to be permitted to recover compensation for that, which he has agreed, the defendant should enjoy, when by his own interference, the defendant has been deprived of it. Clark is responsible in damages, if there has been a breach of his contract, but it does not appear from the current of authorities, that the defendant is to be limited to that remedy alone. The consideration of the contract was the good will of the practice, and so far as that has been taken away by Clark, there is manifestly a failure of it.

The tendency of decisions in this country has been, to allow a broader latitude of defence than was permitted by the rigid rules of the common law, to bills of exchange and promissory notes, where the justice of the case required it, and a circuity of action could be avoided.

Exceptions sustained and a new trial granted.