Edward Livingston, Appellant v. Benjamin Story

• Decision Date: 01 January 1835
• Citation: 34 U.S. 632,9 Pet. 632,9 L.Ed. 255
• Parties: EDWARD LIVINGSTON, APPELLANT v. BENJAMIN STORY
• Court: U.S. Supreme Court

34 U.S. 632

9 Pet. 632

9 L.Ed. 255

EDWARD LIVINGSTON, APPELLANT v. BENJAMIN STORY.

January Term, 1835

ON appeal from the district court of the United States for the eastern district of Louisiana.

On the 25th of July 1832, the appellant, Edward Livingston, filed a bill of complaint in the district court, by his solicitors; stating that on or about the 25th of July 1822, being in want of money, he applied to Benjamin Story and John A. Fort, of the city of New Orleans, who agreed to lend to him the sum of 22,936 dollars; of which a part only was paid in cash, part in a note of John A. Fort, and 8000 dollars, parcel of the said sum, was agreed to be afterwards paid to one John Rust, for the purpose and in the manner afterwards stated. To secure the repayment of the money and interest, at the rate of eighteen per cent per annum, he conveyed to Fort and Story certain property, with the improvements on the same, situated on the Batture in New Orleans, owned by him. When this property was so conveyed, Fort and Story delivered to him a counter letter, by which they agreed to reconvey the property to him on the payment of 25,000 dollars (being the sum advanced and the interest) on the 1st day of February then next; but if the same was not paid on that day, the property should be sold; and after paying the sum of 25,000 dollars and the costs of sale, the residue should be repaid to him. At the time of the sale, the whole property was covered with an unfinished brick building, intended for fifteen stores; and a contract had been made with John Rust to finish the buildings for 8000 dollars. Story agreed to pay the 8000 dollars to Rust, and this was with the interest at eighteen per cent on it, a part of the 25,000 dollars to be repaid on the 1st day of February 1823. The property was, at the time of the loan, worth 60,000 dollars, and is now worth double the sum.

Story and Fort took possession of the property, and the complainant went to New York on a visit; expecting the stores to be finished by his return, or that at least three of them would be in a condition to let; he having received an offer of rent for each of the three, which would have given a rate of interest equal to a principal of 10,000 dollars each for the three smallest stores.

The complainant states that, on his return to New Orleans, he found little or nothing had been done to the stores; the 8000 dollars had been paid to John Rust; and if the property had been sold in February, it would not have produced any thing like its value. He, therefore, applied to Fort and Story for a further time to pay the money borrowed, which they would not consent to, but on the following conditions: that the property should be advertised for sale on the 2d day of June then next; that the sum due to them should be increased from 25,000 dollars to 27,500 dollars; which sum was composed, first, of the said 25,000 dollars, secondly, of 1500 dollars for interest, for the delay of four months, at eighteen per cent, thirdly, 800 dollars for auctioneer's commissions, of 50 dollars for advertising, and of 200 dollars arbitrarily added, without any designation; of which a memorandum was given by the said Fort and Story, and is now ready to be produced: and that the counter letter so executed, as aforesaid, to him by the said Fort and Story, should be annulled.

Being entirely at the mercy of Fort and Story, he was obliged to consent to these terms, in hope of relief when money should become plenty; but on the contrary, the pressure became greater, and on the 2d of June, in order to obtain a delay of sixty days, he was forced to consent to sign a paper by which it was agreed that the debt should be augmented to the sum of 27,830 dollars and 76 cents; and that if the same was not paid on the 5th of August, then the property should belong to the said Fort and Story without any sale: but there was no clause by which he should be discharged from the payment of the sum so borrowed; as aforesaid, whereby he would have been liable to the payment of the sum so advanced in case the property had fallen in value.

On the 5th day of August above mentioned, the said Fort and Story demanded, by a notary, the full sum of 27,830 dollars and 76 cents, which included the said charge of 800 dollars for auctioneer's fees for selling; although no sale had been made and all the other illegal charges above stated; and on non payment they protested for damages and interest on the sum; thereby showing their intent to hold the complainant responsible for the sum demanded, if the premises should, by any accident, become insufficient in value to pay the same.

Fort and Story remained in possession of the said premises until the death of the said John A. Fort, which took place some time in the year 1828; and after his death the said Benjamin Story took the whole of the said property by some arrangement with the heirs of John A. Fort; and is now and ever since has been in the sole possession thereof, and the said John and Benjamin in the lifetime of the said John, and the said Benjamin, after the death of the said John, have received the rents and profits of the said property to the amount at least of 60,000 dollars.

The bill states that the complainant is advised, and believes he has a right to ask and recover from the said Benjamin Story the possession of the said property, and an account of the rents and profits thereof; the conveyance of the same having been made on a contract for the loan of money, and although in the form of a sale, was in reality only a pledge for the repayment of the same; the act by which the complainant agreed to dispense with the sale being void and of no effect in law.

The bill concludes as follows:

'And your orator prays that, if on said account it shall appear that there is a balance due to him, as he hopes to be able to show will be the case, that the said Benjamin Story may be decreed to pay the same to him, and to surrender the said property to him; and that if any balance be found due from your orator, that the said Benjamin Story may be decreed to deliver the said property to your orator on his paying or tendering to him the said balance; and that your orator may have such other relief as the nature of his case may require: and that the said Benjamin Story, in his own right, and also as executor of the last will and testament of the said John A. Fort, or in any other manner representing the estate of the said John A. Fort, may be summoned to answer this bill; your orator averring that he is a citizen of the state of New York, and that the said Benjamin Story is a citizen of the state of Louisiana, now residing in New Orleans.'- Upon this bill a subpoena was issued directed to the marshal, commanding him to summon Benjamin Story to appear at the district court, on the 3d Monday in February 1834, 'to answer a bill exhibited against him in the said court, together with certain interrogatories therewith filed by the complainants.'

A subpoena was also issued in the same terms, directed to Benjamin Story, executor of John A. Fort.

On the 17th day of February 1834, Benjamin Story came into court, and by his solicitor, L. Pierce, Esq. filed the following demurrer.

'The defendant by protestation not confessing all or any of the matters and things in the complainant's bill to be true in such manner and form as the same are therein set forth and alleged, does demur to the said bill; and for cause of demurrer shows that the complainant has not by his said bill, made such a case as entitles him, in a court of equity in this state, to any discovery from this defendant, touching the matters contained in the said bill, or any or either of such matters, nor entitles the said complainant to any relief in this court, touching any of the matters therein complained of. And for further cause of demurrer to said bill, he shows that by complainant's own showing, in the said bill, that the heir of John A. Fort, who is therein named, is a necessary party to the said bill, as much as it is therein stated that all the matters of which he complains, were transacted with this defendant, and John A. Fort; whose widow, the present Mrs Luzenbourg, is the sole heir and residuary legatee; but yet the said complainant hath not made her party to the said bill, wherefore as before, and for all the above causes, and for divers other good causes of demurrer appearing in the said bill, this defendant does demur thereto; and he prays the judgment of this honourable court, whether he shall be compelled to make any further and other answer to the said bill, and he humbly prays to be dismissed from hence, with his reasonable costs in this behalf sustained.'

On the 20th of May 1834, the district court, by a decree, sustained the demurrer, and ordered the bill of the complainant to be dismissed.

The complainant prosecuted this appeal.

The case was argued by Mr White and Mr Key, for the appellants; and by Mr Clay and Mr Porter, for the appellee.

For the complainant it was contended——

1. That the district court of Louisiana has, by the constitution and laws of the United States, the same chancery powers as a circuit court of the United States within the other states.

2. That the bill filed, presents a case in which, by law, and the usages of a court of equity, the complainant is entitled to relief, and that the demurrer ought to have been overruled.

3. The bill of complaint presents a case which, according to the laws and practice of Louisiana, entitles the complainant to relief.

Mr Key, for the appellant. The bill states a case for a court of equity; and the sole inquiry is, whether the district court of Louisiana has, by the constitution and laws of the United States, the same chancery powers as other courts of the United States. This jurisdiction that court certainly has, unless it is taken away by the act of congress of 26th May 1824, chap. 181, 7 L. U. S. 315, relating to the proceedings in the...