Torrens v. Campbell

The opinion of the court was delivered, January 6th 1874, by

Mercur, J. —

Zimmerman & Co. had been engaged in the muanufacture of window-glass. While thus engaged they became indebted to the plaintiff below. William Campbell, one of the defendants below, was a member of that firm. The firm sold out their works to one Tiernan and dissolved. Tiernan continued the business. Subsequently the two defendants below entered into a written agreement of copartnership therein; they agreed to purchase the said glass-works and to prosecute the business, and that “ the firm should become the owners of all debts due the late firm, of Zimmerman & Co.” and that they should “assume and pay the debts owned by said Zimmerman & Co., amounting to say $6600, more or less.”

The plaintiff below seeks to recover under this contract, to which he was not a party. The debt due him was not specifically mentioned in the agreement, but he claims it was covered by the general language used. As he was a stranger to th.e contract and to the consideration upon which it rested, he certainly cannot stand upon higher ground than the party under whom he claims to have acquired this new right. Prior to this agreement he had no claim against Torrens. If he now has any, he acquired it by virtue of this contract alone. It is very clear'that Torrens is not estopped from making any valid defence which he has, to the fulfilment of his agreement. If a suit were brought by William Campbell against him, his right to defend upon the ground of fraud, mistake or want of consideration, would be unquestioned. We think any defence which Torrens might make in such a ease, may now be made by the defendants below in this case. As the plaintiff below claims under that contract he must now take subject to it. He cannot enlarge the obligations of Torrens.

The question raised then, by the exclusion of the evidence, is whether it would have been admissible in a suit brought by William Campbell against Torrens upon the contract. It will be observed that Torrens, had no knowledge of the liabilities of Zimmerman & Co., further than was stated or represented by William Campbell. The defendants in error offered to prove by James Dickson, who was the subscribing witness to the agreement, that before and at the time the agreement was signed, William Campbell produced a list or schedule of the debts due by Zimmerman & Co., amounting to $6738.16, as being the amount they were owing to the parties therein named, subject to be increased or decreased upon settlement of said account, and “that the list or schedule did not contain the account of Calvin Campbell, now in suit.” The offer substantially was to show that Torrens’s agreement was predicated of the list of demands exhibited by William Campbell, and represented to be all the debts due by Zimmerman & Co., or at least, all that the parties to the contract assumed to pay. It also appears by the evidence that the firm of Torrens & Campbell had already paid from $1500 to $2000 of the debts due by Zimmerman & Co., more than the $6600.

The authorities are clear and numerous that parol evidence may be given of what passed between the parties at and immediately before the execution of a writing, where the party was induced to execute the writing by the parol promise proposed to be given in evidence. The evidence, however, should be clear and indubitable to change the effect of the written instrument. We think the evidence clearly admissible, as it tends to show that the agreement in question was entered into under the statement of one party, and the relief and confidence of the other, which negatives any obligation to pay the debt of the plaintiff below. The first assignment is therefore sustained.

The second assignment gives the specific purpose for which the evidence was then offered. We are unable to see how it would have been evidence of a conspiracy, and for that purpose it was properly rejected.

The third, fourth, fifth and sixth assignments will be considered together. The-question presented is .this: assuming Torrens & Campbell, by an agreement between themselves, agreed to pay the debt due to the plaintiff below, from Zimmerman & Co., can he sustain an action in his own name, against Torrens & Campbell, for the recovery thereof? It does not appear when Tiernan purchased the glass-works of Zimmerman & Co., that he purchased any of the debts due to them or agreed to pay any debts due by them. If he did not, then Torrens by the contract acquired directly from a member of the late firm of Zimmerman & Co. an interest in their assets, and assumed jointly with his partner an obligation to pay their liabilities-. It does not appear what was the amount of debts which was due to the late firm of Zimmerman & Co., and of which the defendants below agreed “ to become the owners,” nor whether it was equal to the amount they agreed to pay. The evidence, however, does show that the defendants had collected several hundred dollars out of those assets. Nor does the written agreement distinctly show in what manner the parties were to obtain the ownership of the debts due to the late firm of Zimmerman & Co. In the absence of any specific testimony it may be reasonable to assume that William Campbell had previously become the owner of the debts due to Zimmerman & Co., and had assumed their liabilities, and that by the agreement between the defendants below they acquired assets equal to the amount of liabilities they assumed. * ■

The general rule undoubtedly is that where the contract is for the benefit of the contracting party, and the third person is a stranger to the consideration, the action must be by the promissee : Blymire v. Boistle, 6 Watts 182; Morrison v. Beckey, Id. 349; Hubbert v. Borden et al., 6 Whar. 79; Ramsdale v. Horton, 3 Barr 330; Campbell v. Lacock, 4 Wright 448. A distinction, however, has been made where property has been put into the hands of the person sought to be charged, at the time of his agreement to pay the debt due to a third person. Hence, where Patterson & Lambdin, being manufacturers, failed and were unable to pay their workmen, and made a general assignment of their property to Holdship, who promised Patterson to pay the workmen, it was held that one of the workmen could maintain an action against Holdship: Hind v. Holdship, 2 Watts 104. It is there said by Justice Rogers, a consideration is sufficient if it arises from any act of the plaintiff from which the defendant or a stranger derives any benefit, if such act is performed by the plaintiff with the assent, express or implied, of the defendant, or by reason of any damage or any suspension of the plaintiff’s right at law or in equity ; “ or any possibility of loss occasioned to the plaintiff by the promise of another.” So in Beers v. Robinson, 9 Barr 229, it was held, where Keenan held notes taken upon a sale of his property at vendue, transferred those notes to Beers under an agreement of the latter that he would pay Keenan’s debts, that one of Keenan’s creditors could sustain an action upon that promise. It is true that case limits the liability of Beers to the value of the property received by him, but that is because his contract expressly so limited it. The case of Vincent v. Watson, 6 Harris 96, was this: Irvin owned and operated certain furnaces and ore-banks and was indebted to his workmen. He let the property to Watson & Whitaker, and sold to them all his personal property at the furnaces, and they were to collect and account to Irvin for all the debts due him at one of the furnaces. They further agreed “ to assume and pay whatever domestic debts or liabilities of said Irvin they may think proper, and to be allowed for the same.” They afterwards publicly declared that they had assumed and would pay all the debts of the hands and of the surrounding farmers. It was held that one of the creditors of Irvin might maintain an action against the lessees upon their assumption to pay the creditors. The same principle is recognised in Bellas v. Fagely, 7 Harris 273.

I understand the rule to be this, where the promissor receives money, or personal property to be converted into money, in trust for a third party, the action may be sustained in the name of the latter. The other assignments are not sustained.

Judgment reversed, and a venire facias de novo awarded.