Citation Numbers: 25 F. 541
Judges: Sawyer
Filed Date: 11/5/1885
Status: Precedential
Modified Date: 9/9/2022
This is an action on a note payable in 16 installments. The note was given on June 30, 1882. The contract, in pursuance of which it was executed, was made on May 7,1882. The defense set up, and attempted to be established, is a failure, or partial failure, of consideration.
Such was the law at that time, in view of which the contract was made. The parties, assignors and defendants, were all aware of that fact. The government could cut off any portion of the route. It did reduce the route some 60 miles, after the assignment, and made a corresponding reduction in the amount of money paid.
It is alleged that there was, in consequence, a part failure of consideration, and that the defendants can only be called upon to pay on their note for the portion of the route that was continued; and it is alleged that there was a verbal understanding, at the time the contract was made, that such should be the case. The written contract, however, does not say anything of the kind. The contract, for which the note was afterwards substituted, was made on May 7th, and is as follows :
“It is hereby agreed and understood between I. E. Haskell, superintendent of the Telegraph Stage Company, and ffm. II. Taylor, superintendent of Coast Line Stage Company, each authorized and acting for their respective companies, that in consideration of the sale of certain stage property between Santa Barbara and San Luis Obispo, California, (more fully described in an article of bargain and sale between the parties to the foregoing, of this date,) and the transfer by C. H. Cotter, of the Telegraph Stage Co., of the mail contract between Santa Barbara and Soledad, California, from July 1,1882, until June 80,1886, to the said Coast Line Stage Co., the said Coast Line Stage Co., by their agent, W. H. Taylor, bind themselves to pay to the said A. E. Haskell, of the Telegraph Stage Co., the sum of twelve thousand dollars, to be divided into sixteen payments, of seven hundred and fifty dollar's each; the first payment to be made on December 10, 1882, and the same amount (seven hundred and fifty dollars) to be paid every three months thereafter, until the whole is paid. This memorandum to be void after transfer of said mail contract, and other arrangements made necessary to the full completion of the foregoing agreement. ”
This is the contract as reduced to writing at the time, which provides that $12,000 are to be paid, and nothing is said about any deduction to be made in case the distance should be cut down by the government. The note was executed, in pursuance of the agreement, subsequently, on June 30th, on the transfer of the property, when the transaction was completed, and no deduction is provided for in the note upon the curtailment of the route. Mr. Taylor testifies that at the time of making the contract it was agreed between him and Has
Aside from a failure of proof on this point, defendants seem to rely on the fact that there is a partial failure of consideration. But there is no failure of consideration. Defendants simply took an assignment of that contract, knowing that the distance, as is the case in all government mail contracts, was liable to be cut down. The contractors transferred all they could trausfer,—all their rights under the contract. They assigned the contract as it was, and all there was in them to assign. The defendants got all they purchased, all that was assigned, all that could be assigned. They got the entire contract as it was. They stepped into the assignors’ shoes, knowing that a portion of the route was liable to be cut off,—knowing exactly what they bought. Under the law, it was well known that the government was entitled, at any time, to cut off a portion of the route. It was one of the terms of the contract, express or implied, that it might be cut down, and the parties got an assignment of all they purchased, with full knowledge of the terms of the contract. The defense is therefore, not sustained, and there must he judgment for the complainant. There will be a finding for the installments due, and the interest due thereon. There was an attempt to show that