Haskins v. Lombard

The opinion of the Court was drawn up by

Shepley J.

This case having been argued upon a motion for a new trial as well as upon the report, without a full report of the testimony, it becomes necessary to state briefly some of the prominent facts which do not appear in the report. Before the first of January, 1833, the plaintiffs, and Able and Bradley, and Salmon Niles, had purchased of the State one undivided half of the west part of township numbered four in the first range of townships north of the Bingham Penobscot purchase, and had given their notes to the State to pay for the same in yearly instalments, each party giving his own note for his own share. And on that day they conveyed the same to the defendant; the plaintiffs conveying one fourth, Abbe and Bradley one eighth, and Niles one eighth. The defendant, to secure the payment, gave them obligations to pay the notes which they had given to the State, and mortgages of the same property to secure performance; and to each his note with surety to secure the payment of his proportion of the advanced price. Before these notes became due, the defendant and some of his sureties became embarrassed; and on the 16th of August, 1834, the obligation, referred to in the report, was made and afterward executed by the plaintiffs and by Abbe and Bradley, but not by Niles, although written to be executed by him also. On the 12th of September following, the defendant conveyed the fourth, which he purchased of the plaintiffs, to Prentiss Whitney and others, and took from them an obligation to himself, to pay the notes which the plaintiffs had given to the State. This obligation he lodged in the office of the Treasurer of the State, who had the custody of the plaintiff’s notes, with a power attached, authorising them to institute a suit for their own benefit, in case of failure of performance. It appeared that all the notes, due from the plaintiffs to the State, had been paid, excepting one for $1191, not payable ; and that all due from defendant to plaintiffs, were paid or secured before the 1 st of January, 1835, excepting the one now in suit.

The defendants introduced tbo obligation of the 16th of August, with this and other proof of a compliance with its terms, as a de-fence to the note.

The first objection taken by the counsel for the plaintiffs, is, that the obligation, not being signed by all, was not delivered as their deed, or binding upon them.

Where a deed is prepared to be signed by several and is not signed by all, whether it is the deed of those who do sign it, depends upon the fact whether it was signed and delivered as an escrow only until signed by the others, or was delivered as the deed of the party signing, in tlie case of Johnson v. Baker, 4 B. & A. 440, it was stated in the meeting of those interested before the deed was executed, that if all the creditors of one Bulpin did not execute it, that it should be void. The defendant after this at the same interview executed it, and all the creditors did not. The court were of opinion, that die conversation, which took place immediately previous to the execution, must be taken as part of the transaction, and so the subsequent delivery was conditional, and the defendant not bound by it.

In Cutter v. Whittemore, 10 Mass. R. 442, the bond, as in this case, was written to be executed by throe parties, and it was executed but by two of them. Jackson ,/., in delivering the opinion of the court, says, “ if there had been any agreement or condition at the time, that it should not be delivered as their deed unless the third person named as obligor should also execute it, this would shew, that it was delivered as an escrow.” In the absence of such evidence it was decided to be binding upon those who did execute it.

In Scott v. Whipple, 5 Greenl. 336, the deed was signed by three of the four persons named in it as parties of the first part; and it was contended, that the deed must be regarded as an escrow, because it was not signed by all, but having been delivered without any condition annexed, it was determined to be their deed, although it was admitted, that those who signed, “ expected that one would sign also.” It will be perceived, that the distinction taken in the charge between a condition or reservation annexed to the delivery and an expectation, that another would sign, had already received the approbation of the Court, The testimony to prove the character of the execution, and delivery, was submitted to the jury with proper instructions, and there does not appear to be any sufficient cause for a new trial on this point of the case.

The second question for consideration is, whether the defendant performed so as to entitle himself to the deduction provided for in the obligation. The testimony on this point was at the trial agreed to be received without requiring formal proof from the public office of what took place there, and the court must now consider, that it was properly received. From the certificate of the Treasurer it is apparent, that the contract signed by Whitney and others, must have been deposited in his office before the time appointed for making the security. There is now no reason to doubt the fact; but it is objected, that such contract did not give to the plaintiffs any security, they not being parties to it. They had power to institute a suit for their own benefit in the name of the defendant, and that right would have been protected in a court of law against any release or interference of the defendant. The obligation does not prescribe the security to be given, and any such security as would be both legally and beneficially available may, after they have received an advantage from it without making known any objection to it, be regarded as a substantial compliance. The question whether the defendant had on his part complied with the terms of the obligation, involving many matters of fact, was necessarily submitted to the jury; and it may be, that instructions were not given upon the construction of the papers so specific as may now be perceived to have been desirable. But if the points had then been made, it is presumed the instructions would have been given, or some exception would have been taken, or request made for more particular instructions.

The third question is, whether these facts constitute a defence to this suit. It is objected, that the obligation is a joint one, and that there can be no severance of it, and an application of part of the sum only to the defendants. The facts show, that each of the three parties to it conveyed his separate share of the estate and received his separate security upon it. And the obligation provides, that the defendant may give security “ to us or either of usand being given, that “ we will make the deduction in the same proportion and that a release from the mortgages shall be given of “ such part of the premises as wo shall receive security for.” As the securities and mortgages were separate these deductions and releases must of necessity have been separate acts; and the defendant was authorized to give security to either separately. Where the interest of the covenantees is several, each may sue separately, although the obligation be joint. So where the interest of the cov-enantors is separate, and performance cannot be made jointly, the covenant must be regarded as several, unless the intention of the parties appears to have been, that each should be bound for the performance of the other. If the intention of the parties was, that each should make the deduction and release in proportion as he should be secured, and that they were not to be bound for each other, and this they had carefully avoided in all the prior proceedings, this objection would prove to be without foundation. If this be doubtful, yet upon the principle of the case of Phelps v. Johnson, 8 Johns. R. 54, the defendant might claim the benefit of the joint obligation as payment pro tanto of the note. In that case, two agreed by sealed notes to pay, and one of them afterward gave a bond and mortgage for the amount due upon the notes, and the promisee covenanted with him to deliver up the notes. It was decided, that this covenant with one was a bar to an action against both upon the notes. The Court say this construction is necessary to avoid circuity of action, for the defendant would be entitled to recover back under the covenant the same sum in damages which would be recovered on the notes. So the defendant in this case might recover against the plaintiffs and others, the precise sum recovered upon the note, and might collect the whole of it from the plaintifis alone. And as the obligation is to deduct from the note it may operate as a receipt in part payment or as a release of so much as should be deducted.

Nor does the pendency of the bill in equity preclude the defendant from making his defence at law if it will avail him there. It is said that he, should not be permitted to make this defence upon the principle of abatement, the pendency of that process taking away such right. But in abatement, the party is defeated upon strict legal principles ; while none such exist in this caso to prevent the party from using his obligation and testimony as a legal defence. He may defeat his bill in equity, but its pendency cannot take away his right to defend against the note.

Judgment on the verdict.