Wharton v. Hudson ( 1832 )

The opinion of the court was delivered by

Gibson, C. J.

The procurement of a charter from New Jersey, is insufficient to affect the plaintiff’s right to a return of his subscription, arising, as it does, from the failure of an enterprise that could be prosecuted only under the joint authority of that state and Pennsylvania. The consideration having failed, with the effort to procure a correspondent charter from the latter, the plaintiff was entitled to retribution from some one; and why not from the defendants in whose hands his money had remained ? Because, say they, an action of indebitatus assumpsit is not maintainable against an agent whose principal is known. Such, however, is not the law where the money has not been paid over without notice, the action lying on the promise to pay which the law implies wherever one man has the money of another. The question then, is, whether the plaintiff’s money is in the hands of the defendants, in contemplation of law. Pursuant to an agreement with their principals, by which they were to have one per cent, on all subscriptions received, they claim to retain for the balance of their account. But the plaintiff claiming paramount to the principals, is not to be affected by their agreement. Between themselves, the principals and their agents might determine their respective claims to the money; but not the claim of a third person to whom they all stand in the same relation, neither being allowed to set up a defence that would not be equally available in favour of the rest. There may perhaps be such a thing as a constructive payment over by an appropriation to a balance in the agent’s favour on a settlement of his account before notice of an adverse claim, especially if he would be put in a worse situation than he was before, by being compelled to resort to the principal on original grounds; but no such appropriation is pretended here. The money is, no doubt, subject to its proportion of all reasonable charges in the agent’s hands ; and that matter is regulated in the particular instance, by the act passed on the part of Pennsylvania which directs the money to be returned in the event of a failure, deducting the necessary expenses; yet the court charged that the plaintiff could demand no more from the defendants than the commissioners could have demanded from them had the project taken effect, thus subjecting the plaintiff’s money, not merely to its own share of the general burthen, but to the balance of the agent’s account. The error however was in favour of the defendants, who have no right to come here as complainants in consequence of it, especially as it was entirely consistent with the direction which they themselves had prayed. It is said, however, the act gives an action against the commissioners, and that by the act of 1806, statutory remedies must be exclusively pursued. It however gives no new remedy ; and least of all a remedy against the agents whose case is left as it stood at the common law. The errors therefore are not sustained. ,

Judgment affirmed.