Bridges v. Sheldon

• Decision Date: 06 January 1880
• Citation: 7 F. 17
• Court: U.S. District Court — District of Vermont
• Parties: BRIDGES v. SHELDON and others.

7 F. 17

BRIDGES v. SHELDON and others.

United States Circuit Court, D. Vermont.

January 6, 1880

Gillmore & Anderson and Prout & Walker, for orator.

Daniel Roberts and W. H. Smith, for defendants.

A suit in equity for an account against the defendants for moneys which complainant claimed respondents had collected for his use from the government of the United States, for work done under contracts with the United States, whereby Bridges, as contractor, and as assignee of other contractors had agreed to erect marble head-stones for soldiers' graves. The contracts were left by the secretary of war, in December, 1873, to four contractors: Samuel G. Bridges Thomas P. Morgan, and C. S. Jones, each about one-third of the head-stones for the graves of known soldiers, and to De Witt C. Sage, blocks for the graves of unknown soldiers. Jones refused to perform the part of the contract let to him and it was again let to Morgan. After the contracts were let, and before December 18, 1874, Bridges became the assignee of the contracts of Sage, had purchased a part of Morgan's, and had made a conditional contract with Morgan for the purchase of the balance of Morgan's and Jones' contracts.

Bridges began purchasing stone from Sheldons & Slason, of Rutland, Vermont, to fill his contract, in April, 1874, at $1.25 per stone; and in October, 1874, upon becoming assignee of Sage's contract, made an agreement with Sheldons & Slason to furnish stone for that contract at 81 cents per stone. In order to purchase the contract he had to give security for its performance, and Sheldons & Slason became the security upon an offer by -ridges to give a bonus in three propositions of $3,520.32. He agreed to pay for stone, furnished under the Morgan and Jones contracts, $1.30 per stone. On December 18, 1874, Bridges made a proposition in writing to Sheldons & Slason, proposing that they should furnish the marble for all the contracts, and the means to carry them on; and proposing to give them one-third the profits-- guarantying profits to them to be at least $20,000. Sheldons & Slason accepted the proposition in writing as follows:

'The price heretofore agreed upon for head-stones and blocks is not to be considered as included in the $20,000 mentioned in this as above. We assent to this proposition; full agreement, in accordance, to be hereafter executed.

'SHELDONS & SLASON.

'The understanding is that the full agreement referred to above may be modified and made so as to fix the compensation of S. & S. by a definite price per head-stone and Block, in addition to the price heretofore agreed upon. This, in lieu of the one-third interest, but not of the given sum of $20,000. S. G. BRIDGES.

'SHELDONS & SLASON.'

Bridges, in purchasing Morgan's contracts, gave him four notes, of $5,000 each, payable five, seven, nine, and eleven months after December 24, 1874, respectively, secured by an order on the government for payment out of four of the cemeteries assigned. These cemeteries were not completed, and there was no possibility of completion at the times the notes were due; and In May, 1875, Morgan having proposed to take from Bridges $15,000 for the $20,000 of notes, Bridges made application to Sheldons & Slason for the advance of so much. Charles Sheldon went to Washington, and upon seeing Morgan offered to give $10,000 for the notes instead of $15,000, which Morgan refused to accept. Sheldon increased the offer to $13,000, and would give no more. Thereupon Bridges, without the knowledge of Sheldon, gave his note to Morgan for $2,000, and thus made up the $15,000 demanded by Morgan; Sheldons & Slason giving notes for $2,500, $2,500, $4,000, and $4,000, respectively; and Morgan gave up the notes to Sheldon, Bridges not being present. Sheldon required Morgan to indorse the notes to Sheldons & Slason.

On May 20, 1875, a contract was drawn up in pursuance of the proposition of December 18, 1874, (Bridges meantime having completed his contract with Morgan so that he had all the contracts to fill,) between Bridges and Sheldons & Slason, dated back to December 18, 1874, wherein Sheldons & Slason agreed to furnish marble, means, power, and machinery necessary to fulfil the contracts; Bridges to do the work necessary to finish the stone, and erect them in the cemeteries. And under the contract the prices for head-stones were increased so that Sheldons & Slason were to receive for head-stones furnished under Bridges' contract, $1.41 per stone; under Morgan's and Jones' contracts, $1.46 per stone; and under Sage's contracts, 90 cents per block, and six cents commission upon each stone purchased from others, and to receive 9 per cent. interest on advances until repaid, and 9 per cent. interest on the price of stones, 60 days after shipment, until paid.

It was agreed that all moneys paid by the government under the contracts should be paid to Sheldons & Slason under powers of attorney from Bridges. After paying themselves, compensation for stone, advances and commissions, they were to pay the balance remaining in their hands to Bridges, and until the stone were set in the cemeteries they were to remain the sole and absolute property of Sheldons & Slason. The contracts were completed in June, 1877.

In June, 1875, a cargo of stone loaded in the schooner Almaretta was lost off the Bahama islands. The cargo was in part loaded on deck. The policy of insurance was an ordinary marine policy. No extra premium had been paid for deck loading. After the loss the insurance company returned the premium and refused to pay any insurance. The cargo was a total loss. Complainants claimed the loss should fall on respondents under the contract, and respondents claimed the loss should fall on complainant.

The cause was referred to a master to hear and determine.

The other necessary facts appear in the opinion.

WHEELER, D.J.

This cause has been heard on the report of the master, evidence returned therewith, exceptions by the orator and the defendants respectively, and arguments of counsel. The exceptions, especially those of the defendants, are too numerous to be conveniently treated and understood by their several numbers or in numerical order. The items to which they apply, so far as separate reference to them is either necessary or deemed to be proper, are taken up somewhat in the order in which they are presented by the report.

1. As to the item of $3,520.32 for indorsing paper and meeting liabilities, presented for allowance by the defendants. This item is made up of three sums, severally offered in writing by the orator to the defendants, for indorsing some and guarantying other of his paper, and furnishing him stone upon credit, to be retained out of the avails of his contracts with the government received into their hands. Each sum was offered in connection with the furnishing stone by the defendants, or by others, at stipulated prices, for filling his contracts, and was accepted in that connection. Afterwards a new contract was made between them, by which the defendants were to receive a larger sum for the stone furnished by them, and a commission on the stone furnished by others in the same connection, and by which an appropriation was made of the avails so received by the defendants from the government. This advance in price exceeded one of the sums, and the advance and commission probably nearly equalled and perhaps exceeded, each of the others, although exactly how the others would compare is not easily ascertainable. However they might compare, the parties took several of the subjects of the former contract and embraced them in the latter upon new terms, without expressly providing what the effect upon the subjects of the former not embraced in the latter should be. The latter must stand because it is the later act of the parties. With the latter contract standing, the former cannot be carried out as it was made in respect to those sums composing this item. So the new contract superseded the old to that extent. The defendants could not, consistently with the new contract, retain those sums out of the money received from the government, and they are not now entitled to have it allowed to them out of the balance of that or other money of the orator in their hands. The exceptions to the disallowance of this item are overruled.

2. As to item of Morgan notes, $20,000, admitted $13,000. Morgan held four of the orator's notes, of $5,000 each. They were given upon good consideration, negotiable, and, so far as appears, just. Before they were matured the defendants purchased them, and they were indorsed to the defendants. The defendants paid $13,000 for them. They are brought into this accounting without objection, and the only question is whether the defendants shall be allowed their face or only what was paid for them. As they were valid and negotiable the defendants, or any one, had good right to purchase them on any terms they could agree upon with Morgan, and to hold them for their full amount against the orator, and by so doing they would infringe upon no right of his. He owed them, and all the right he had was the right to pay them according to their terms when due, so long as they should be outstanding. He could purchase them himself, or procure any one else to do it for him, upon any terms he could make. He did not purchase them himself for himself: the defendants purchased and took them. If the defendants purchased them for him, he has the right to stand upon their purchase according to its terms, as if he had done it himself. If they purchased them for themselves they had the same right to hold the notes for their full face after the purchase that Morgan had before. And if they had it then they have it yet, for there is no pretence that the...