Berghaus v. Alter , 9 Watts 386 ( 1840 )

The opinion of the Court was delivered by

Kennedy, J.

The first error assigned is, that the court rejected the testimony of George H. Berghaus, taken under a commission, directed to Richard H. Chinn and Todd Robinson, Jun., Esquires, of the city of New Orleans, authorizing them, or either of them, to take it, when it ought to have been received. The objection to the admission of this testimony was made in the court below, first, on the ground that George H. Berghaus, being a joint and several drawer, with the defendant, of the note on which this action is brought, had such an interest in the event of the action, although released by the defendant, as to render him incompetent to give testimony; and, secondly, that the rule entered for issuing the commission, notice of which was duly served upon the attorney below for the plaintiffs there, directed, as it was alleged, that the commission should be issued, authorizing the commissioners named therein to execute it jointly, and not either one of them to do it, as was done. The court overruled the first ground of objection, but sustained the latter. George H. Berghaus being released from all liability to the defendant, for and on account of the costs and charges to which the latter might be subjected by means of this suit, we think the court below were right in pronouncing him a competent witness. A judgment against the defendant could not affect George PI. Berghaus directly, nor would it be evidence for the plaintiffs in an action brought by them on the note against George PI. Berghaus, because he is no party to it, and had no right to claim to be heard in court on the trial of the cause. It would, therefore, be most obviously unjust to conclude him by a judgment in a suit when ho was not a party, and could not claim to be heard. Suppose the judgment in this suit had been against the plaintiffs below, it would scarcely be imagined, I apprehend, that it would have been a bar to a recovery, in an action brought by them, on the same note, against George H. Berghaus. Now if it would not, it would be unreasonable to hold, that a judgment here would be evidence conclusive against him, unless it were to be held, on the other hand again, that a judgment here, in favour of the defendant, would be evidence conclusive in favour of George H. Berghaus. To operate as an estoppel, it must have a reciprocal effect, so that either party may have the benefit of it. Besides, it cannot be said here, that George H. Berghaus had even an interest in this question put in issue, because his liability to the plaintiffs below for the same amount of money claimed in this action, was not denied or contested. • The only point of difference between him and the plaintiffs was, as to the appropriation of the moneys, admitted ' to have been paid by him to them. If he had any interest then at all in this suit, it could not be aspecuniary one, but such merely as might be naturally imputed to arise from the relationship that existed between him and the defendant, and a conscientiousness on his part, perhaps, that he had béeri the occasion, in some measure, of bringing his father into the trouble of attending to and defending this suit.

Now, as to the second ground of objection, we conceive that the court erred in regard to it, and that the testimony ought to have been admitted. We do not consider that the rule entered for issuing the commission, nor that the notice given to the counsel of the adverse party, necessarily imported that the commission intended to be taken out, was to be one, giving authority to the two gentlemen, named as commissioners, to act jointly in the execution of it, and not otherwise. The- most that seems to be contained in the rule, as to this, is a mere nomination of the commissioners, without any explicit declaration of a wish or design, that they should be authorised to execute the commission unitedly and not either one singly. As to this latter matter, it seems to have been left to the cleric to make it out in the usual form, or, at all events, the clerk was not restrained, by the terms of the rule, from making out the commission as he did, so as to give authority to either of the commissioners to take the testimony. I would further observe that such objections are not entitled to favour, when taken at so late an hour as in this instance. We, therefore, think the testimony ought to have been received.

The second error consists of several bills of exception to evidence admitted by the court. It is, however, sufficient, without noticing them in detail, to say, that no one of them, in our opinion, has been sustained.

The remaining errors are exceptions to certain parts of the charge of the court delivered to the jury, and to answers of the court on points submitted by the counsel of the defendant below. We are unable, however, to perceive any error in these exceptions, except as to one matter, which embraces the instruction given by the court to the jury, in regard to the appropriation of the various sums of money, paid at different times by George H. Berghaus to the plaintiffs below.

In the first place it is proper to observe, and it must be borne in mind throughout, that the note in suit was given to secure the payment of a debt created by George H. Berghaus, for his own exclusive benefit: and that he must, therefore, be regarded as the principal debtor, and the defendant as his surety merely. That such is the fact appears most conclusively, not only from the books of the plaintiffs below, but likewise from the written correspondence between them and George H. Berghaus. Again, it is also equally proper to observe and bear in mind, that, from the letters of the plaintiffs below to George H. Berghaus and his letters to them, it appears, to a degree of certainty that admits of no doubt, that the note in suit was considered as having been given and accepted as a mere collateral security for the payment of the price of certain goods, previously sold and delivered by the plaintiffs below to George H. Berghaus, and charged to him in their books of account. That it was given and taken as such security is most explicitly assented to by the parties in their written correspondence; and seeing it is for the benefit of the defendant that it should be so considered, especially as he is only a surety, he has a right to claim that the plaintiffs below shall be bound by their agreement or assent in this respect; and that they shall not now be permitted to say that the note was taken in payment of the book debt of George H. Berghaus, which formed the consideration of it, and, therefore, such book debt has become thereby extinct. It must, however, be admitted, that it seems to appear, from the circumstance of the note being credited to George H. Berghaus, in the plaintiff’s books of account, against him, in the same manner as if it had been so much cash paid, and also from the testimony of William J. Dewey, a brother of one of the plaintiffs below, that the note was taken in satisfaction of the debt for which it was given, and not as a collateral security. But it would not be safe, nor would it be right to suffer such evidence to control and set aside the express written agreement, as it were, of the parties on the subject; plainly showing the contrary. Nor is this all, for, on the 15th of October 1S36, the plaintiffs and George H. Berghaus stated their mutual accounts, striking a balance against him of 4124 dollars and 33 cents, in which they charge him with interest on the book debt, from the time it originally was to have been paid, for which the note was given, though the note was drawn extending the payment of the money mentioned in it to a date nine months and a half later, thus showing, most clearly, that the book debt, for which the note was given, was not considered as thereby extinguished, but that it still remained in force, bearing interest from the date at which it was to have been paid, according to the terms of the original agreement under which the debt was first created. This could not have been done had the note been taken in discharge of the debt, because the note did not bear interest; and to have charged interest on a debt that had been extinguished before the time for which interest was charged commenced, would not only have been unjust but absurd: and, therefore, such charge is only.reconcilable with the fact, that the note was taken merely as a collateral security. The note then being taken as a collateral security only, and the debt for which it was taken still remaining in force as a book debt, and there being no evidence given on the trial tending to prove that the time for paying it was extended by agreement, in connection with giving the note beyond the period fixed on at first, it followed, as an inevitable consequence, that the book debt, on account of which the note was given, still stood open against George H. Berghaus, and that he, notwithstanding the note, remained liable to pay it, as soon as the time should come around at which it was originally agreed to be paid. The goods then having, as it would seem, been all purchased on a credit of six months, and that portion of them, for which the note was given, having been purchased first, became of course payable first. Hence all payments made by George H. Berghaus subsequently to the plaintiffs, for which receipts were given, expressing the money to have been received “ on account” generally; or a credit given therefor in the books of the plainiiffs generally, without making any special appropriation of the same, when none had been made by the payer, would be appropriated by law to the payment of the book debt, for which the note had been taken as a collateral security; for, although the note might, at the time, not have become payable, yet the book debt for which it was given had, which was sufficient to warrant the appropriation to the latter. It is true, however, that a different appropriation was made afterwards, between the plaintiffs below and George H. Berghaus, but this was some time after the law had interposed itself and made the appropriation which would go in discharge of the debt for which the note was given. And had no one been interested in the appropriation, made bylaw, of the moneys previously received, it would have been perfectly competent for them, by their subsequent agreement, to have changed the appropriation so made by law as they pleased. B.ut then the previous appropriation made by law went to discharge the defendant below, who, being a mere surety, derived no benefit whatever from the debt, and being once discharged from his liability as such, his obligation could not be revived subsequently without his assent, which is not pretended to have been obtained to the appropriation, made by the plaintiffs below and George H. Berghaus, when the balance of 4124 dollars and 33 cents was struck against him, and for which it would appear that he gave his note to the plaintiffs. The court below, in presenting this case to the jury, seem to have taken up the notion that the payments made by George H. Berghaus to the plaintiffs below, before the note in suit became payable, could and ought not to be applied by the jury to the discharge of it, unless applied specially in that way at the time when made. Had not the original promise, made by George H. Berghaus to the plaintiffs below, to pay the debt for which the note was given, been still in force, the opinion entertained by the court, in this respect, might have been correct. But the note being taken merely as a collateral security, that original promise remained in full force and unextinguished notwithstanding; and being the first engagement made by George H. Berghaus, in point of time, under which moneys could or did. become payable by him .to the plaintiffs below, all moneys paid by him to them generally,'and not otherwise appropriated at the time of payirient, ought to have beeu considered as paid in 'discharge of it. This would have been, in effect, applying it to the discharge of the note, though no mention whatever was made of it. Had then the 500 dollars, credited in the book of the plaintiffs below generally, on the 7th of November, and the like sum credited in like manner on the 19th of December 1836, and 54 dollars in the same way on the 12th of January, together with 1200 dollars on the 27th of March 1837, been appropriated by the jury in the manner last'mentioned, as we think it ought to have been, though, under the instruction of the court below could not very well be done, the debt, for which the note was given, would have been discharged, and consequently the note itself have been paid; and, of course, a verdict have been given for the defendant below. Not being able to accord with the court, in the direction given by them to the jury, in relation to this branch of the case, we think the judgment ought to be reversed on this account, as well as on account of the rejection of the testimony of George H. Berghaus.

Judgment reversed, and a venire de novo awarded.